“THE safety of our customers and employees has always been our highest priority,” said Alex Youn of AC Pacific LLC, also doing business as I Love Saipan.
“We were forced to vacate the premises at the May Ten II Building due to the landlord’s failure to repair the building, which had become structurally unsafe and hazardous for occupancy,” Youn said in a statement to Variety.
Recently, Magic International Corporation filed a civil lawsuit against AC Pacific in the CNMI Superior Court, alleging breach of two long-term commercial lease agreements.
The plaintiff seeks compensatory and punitive damages for unpaid rent, late fees, and other financial losses.
Magic is also seeking a court order for a judicial declaration affirming that AC Pacific was not constructively evicted and that the lease agreements remained valid and enforceable at the time of default.
But according to AC Pacific, they made repeated requests for the landlord — Magic International Corporation (owner of the May Ten II Building/Furusato Restaurant Building) — to address dangerous conditions, including a crumbling façade, falling concrete, exposed structural elements, water leaks, and mold.
“Our requests were not resolved. The building’s state deteriorated to the point that our business was denied liability insurance due to the unsafe environment. Faced with an uninsurable and hazardous property, we informed the landlord that we considered ourselves constructively evicted and would vacate,” Youn said.
He added that AC Pacific is disputing the claim that they owe rent for a property that was not safe to occupy, and that the allegation of fraud is entirely without merit.
The AC Pacific executive said the critical safety concerns were not just their opinion: “They have been officially validated by the CNMI government,” Youn said.
According to Youn, on February 5, 2025, the Saipan Zoning Office posted a public “Notice to Abate Nuisance” on the building, officially citing it as a “Dilapidated/Unsafe Structure.”
He said this government action supports their position and demonstrates that the fraud allegations against them are baseless.
“We were forced to protect our staff and the public by leaving the building at our own expense — a building that the government itself has now deemed unsafe. And to add insult to injury, we have asked to be allowed to take our sign down from the outside of that awful, blighted building, and the landlord has not yet agreed to let us do so,” Youn added.
According to the complaint, Magic — a CNMI corporation specializing in leasing commercial real estate — entered into two separate 20-year lease agreements with AC Pacific, a retail gift shop operator, for spaces in the May Ten II Building in downtown Garapan.
The leases, signed in 2014 and 2016, included provisions for escalating rent payments and required AC Pacific to maintain liability and property insurance.
In the lawsuit, Magic claims that AC Pacific has repeatedly defaulted on rent payments since January 2024, despite numerous follow-ups and partial payments. AC Pacific also allegedly requested rent discounts and extensions due to economic hardship, but later informed Magic of its intention to vacate the premises before the lease terms expired.
As part of its fraud allegations, Magic states in the complaint: “AC Pacific did not previously notify Magic that these alleged conditions would serve as grounds for constructive eviction, nor did it vacate or cease operations during the period of alleged uninhabitability. These facts contradict the claim that the property was rendered unfit for use.”
