EXORBITANT rent increases are not the reason behind Club 40's imminent closure, but its owners' refusal to pay a standard service charge, according to the building's landlord.

The service charge, which increased the rent by $3.35 per square foot, is something the tenants of Brunswick Mall should have been paying to the building's previous owner, said Barry DeCouto, whose family bought the property last November and oversees its operation through their agency, DeCouto and Dunstan Real Estate Limited.

Club 40 co-owner Rick Olson last week stated in this newspaper that the nightclub was forced to close its doors at 119 Front Street because of a three-fold rent increase. Unless he and co-owner Kevin Burrows were able to find another location for the popular nightclub, he said, its doors would be closed for good.

According to Mr. DeCouto, the rent increase was far less than Mr. Olson, through this newspaper, led the public to believe.

"The building wasn't managed properly before. What they were paying before was less than warehouse rent," he said. "They're complaining because they were charged a service charge. All the buildings in Hamilton operate under a service charge which includes payment for elevators, insurances, maintenance, management, janitorial services, etc.

"We tried to put a new agreement in place but the tenant didn't want to agree to it. They were given an opportunity to renew the lease but they didn't want to meet those terms."

The Front Street nightspot has operated under a variety of names and a series of owners since it was first opened to the public as The Forty Thieves by entrepreneur Terry Brannon in 1962. A colourful history followed with famous celebrities, such as Tom Jones, Gladys Knight and the Pips and Ike and Tina Turner, often passing through its doors.

The family sold the nightclub, and the building, in 1988.

The DeCouto family purchased the building last November after the previous owner defaulted on mortgage payments, Mr. DeCouto said.

"What that means, with the new owner, is that all (existing) leases are null and void. I (presented them with the new lease) and they said they weren't paying and they weren't moving out. The next course of action for me to take is to serve them with an eviction notice.

"Whatever the landlord chooses to do is his priority. They had the opportunity to buy the building just as we did."

Club 40 is one of Front Street's two nightclubs.