The fight for the Festac Lounge: Why two Black business owners saw their dream become a nightmare in Vaughan

They faced pushback. They were locked out. They’ve seen police and bylaw repeatedly. They say they won’t give up.

Thestar.com
Aug. 9, 2023
Shree Paradkar

The glint of gold behind the tint of windows gives a hint of the unexpected that lies within.

Look it up on social media with its cleverly curated videos and music, and you might think the Festac Lounge in Vaughan is a nightclub, filled with snappily dressed young people standing up to sway or weave their way between tables, amid pulsating beats and laser lights in a darkened room.

But step in, and you’re transported to a large noir-themed restaurant and bar, nestled in a corner of an upscale Weston Road plaza.

Ordinarily, if one were to meet the entrepreneurs who had transformed a blank space into an eye-popping lounge, you’d expect to meet people exuding optimism and triumph.

Instead, they are tired and teary. When the place is busy, social media images show them with game faces on. But after their lounge empties out each night, they bring out air mattresses, pump them up and go to sleep. On the advice of their previous lawyer, they are making sure someone is in the building 24-7, lest their landlord lock them out. They are fighting ruin less than a year after opening.

From the beginning they faced tangles with a local citizens group whose long arm appeared to influence the city, the police and the duo’s landlord. Objections before the lounge even opened, complaints that led to permit delays and visits from city staff and police, and a landlord who wanted to get out of the 10-year lease.

The two ostensible causes of these issues are a) their business is too loud and b) the definition of the business they are running: What do you call an eatery with a touch of the night? Is it a restaurant? Is it a lounge? Is it a nightclub?

But at least some of the pushback against the entrepreneurs appears rooted in racist insinuations linking the Black owners to danger and criminality, underpinned by the question: do they belong here?

“They’re trying to pick at anything they can to close this business,” says Shernett Martin, executive director of the local Black rights advocacy group ANCHOR, African Canadians Against Hate, Oppression and Racism.

The city, meanwhile, insists staff from various departments are working with the lounge owners to ensure the business complies with bylaws and can operate successfully.

The dream
Entrepreneurs Eghosa Iyamu and Onus Onuwelu had a dream. It was a simple one but a tad big to execute alone. That’s why they decided in 2018 to establish a lounge of the kind they felt was needed in the GTA, one that would “showcase the richness of Africa” and reflect the ethos of Nigeria, from where they come. All they needed was a long lease in a good location and a patio -- a patio was a must in their vision -- to make the dream come true.

After nearly three years of hunting -- a combination of them being particular about the location and finding that landlords were unwilling to lease to them -- they found a spot: three adjoining units in a strip mall north of Rutherford Road, in the Vellore Woods neighbourhood of Vaughan. There were schools nearby and they planned to have special offers for students. Around them: a bakery, a bubble tea spot, a dentist, a chiropractor, among others. Almost as if the plaza were waiting for them, it lacked a good-sized dine-in restaurant.

One of the recurring issues around Festac's operation has been what the operation is ? a bar, a restaurant, a lounge, a nightclub?

The three units had been vacant for more than a year. The landlord, Roybridge Holdings Ltd., which is part of the Zzen Group of Companies founded by prominent Vaughan businessman Vic De Zen, was open to doing business with them, and the duo were set to go.

In the fall of 2021, they got the go-ahead from the city. They sent off a detailed business plan to the landlord that made the case for their vision to “redefine nightlife” in Canada. It included floor plans for the restaurant and patio, shared plans to offer live shows and host private events, as well as menus and plans to soundproof walls, manage lineups and hire security guards to help “create a top-grade club environment.”

They signed a 10-year lease for the three units with plans to develop a patio. At this point, they believed, all that was left to do was to pour their heart -- and savings -- into the dream project.

They were doing what the metaphor often wielded against Black people asks them to do: pulling themselves up by their bootstraps.

But soon after the lease was signed, the men embarked on a journey that brings to mind Martin Luther King Jr.’s admonition in 1967: “It’s a cruel jest to tell a bootless man that he ought to lift himself by his own bootstraps.”

The duo in Vaughan were about to discover what King meant when he said many Black people had been left bootless as a result of a refusal to give them an economic base.

An early warning
Construction was set to begin in 2022 when their property manager told Iyamu and Onuwelu that a ratepayers association wanted to speak to them.

Who? And what about?

According to the City of Vaughan website, a ratepayer association consists of residents who “come together to address issues affecting its neighbourhood, such as traffic congestion, new proposed developments and safety concerns.”

When the property manager, Ruth Silva, gave the owners the gist of what the ratepayers wanted to ask them, they demurred.

Soon, Silva was “strongly recommending” that they cease construction.

Silva said in an email she had been advised by the city, bylaw and police “that there will be zero tolerance in this community plaza.”

Zero tolerance for what?

In a followup email, she said: “We have an irate Rate Payer Group, By-Law Enforcement, Tenants within the Plaza, and the Local Ward Councillor that have expressed serious issues and raised several questions related to your use in our Plaza that have gone without address because of your reluctance to meet with them to address same.”

What serious issues? The property management company did not respond to the Star’s questions by email. Reached by phone, Silva simply said, “I can’t assist you, thank you.”

Two days later, the owners received an email from Vito Pedano of the Vellore Woods Ratepayers Association that copied in association chair Elvira Caria, Vaughan Coun. Rosanna DeFrancesca and property manager Silva.

The email said the association was a volunteer resident group with an “impeccable reputation,” to whom businesses and developers have been grateful. “We are perplexed to find that after 20 years there appears to be somewhat of an apprehension on your part, which has caused more questions and concerns for us. You should not only embrace our outreach,” but take advantage of the group as a “free PR outlet.”

The association began by pointedly asking why Festac Lounge was in that community (all capital letters theirs): “What attracted you to the community of Vellore? Specifically this small neighbourhood plaza? Why here? Who is your target demographic? Have you done a market-consumer analysis of this area? Is this area a sustainable OPTIMAL long term location for your business to thrive?”

The email then veered in a different direction. “Do you have any association with FESTAC LOUNGE in New York City? If so, what is FESTAC LOUNGE? If not, WHY name this FESTAC LOUNGE? Is it your intent to ‘mimic’ the nature of the business of FESTAC LOUNGE NYC in any way?”

A quick Google search shows there was a shooting in a place by that name in Brooklyn in 2014. Was a Vaughan business being damned by association for a random act in another country, a business to which it had no connection other than its name?

“That argument is nonsense,” says Martin, of the advocacy group ANCHOR. “There’s always gunshots at Walmarts in the United States. So that Walmart (in Vaughan) is open and you have no problem with them!”

“Are you aware there is a HIGH SCHOOL immediately across Weston Road?” the association asked.

Instead of raising any supposed serious issues, the email was awash in innuendo.

The email said: “Our intent as a RATEPAYER’S ASSOCIATION is to protect the community.” But what were they protecting the community from?

Has every small business in Vaughan produced a market consumer analysis to a volunteer group? Pinpointed a particular demographic?

Iyamu and Onuwelu responded via their lawyer at the time, asking what authority the association’s members had to send those questions. The owners didn’t hear back from the association. Caria and Pedano did not respond to an emailed list of questions from the Star. Reached on the phone, Caria said, “I’m not interested in speaking with you at all. Thank you. Absolutely not. You should get your facts right first.” She hung up while being asked to identify those facts.

In March that year, the owners got the go-ahead from the property manager to continue their work.

“We thought everything was over,” Iyamu says.

It wasn’t.

When construction ended
Come September 2022, the restaurant was ready, pending a permit from the city to open. But Iyamu says city officials would come inspect the property and leave without giving them the permit. The city says bylaw staff attended five times before issuing the permit.

“We asked them why,” Iyamu says, and one of them told him: “There is something on the system saying we shouldn’t give it to you. Everything is OK. The officer one day said, ‘I’m going to give this to you. In my good conscience, I don’t see why I’m withholding this from you.’”

“It was traumatizing, you know,” Onuwelu says.

They decided to inaugurate their restaurant during the Thanksgiving weekend in October, after being told to expect the licence in three to five days. When they went to pick it up, they were told they’d have to first speak to zoning officials -- on the Tuesday after the long weekend.

They cancelled all the planned activities.

“The city’s bylaw and Economic Development staff met with Festac Lounge’s owners and operators to assist them in understanding the need and processes for business licensing and to answer their questions,” the city told the Star, but did not answer a question on whether this was standard practice.

At that Tuesday meeting after the long weekend, the owners say zoning officials asked them what their business model was, their expected hours of operations, if minors would be allowed on the premises.

“They also told us they were hesitant to give us the licence due to some form of petition that was initiated by certain persons, but they did not give us names,” Iyamu says. But all the checks by the city showed the lounge was up to scratch. “After the conversation, we were sent the electronic copy of the licence.”

The restaurant opens, and authorities arrive
Once Festac Lounge opened, police became a frequent presence, visiting more than 10 times in six months. “People would ask, ‘What’s going on?’” Iyamu says. “It’s like they (police officers) are trying to create an impression that is not there. They come, inspect everything is in place and walk away. I’ll be like, ‘Why were you guys here?’ ‘Oh, we received calls.” But they wouldn’t say who is calling.

Police presence hurt their fledgling business, they say. “People come, they see police, they drive back. It’s like intimidation,” Iyamu says.

York Regional Police confirmed to the Star it never laid any charges against the Festac owners.

“The city bylaw had been approached by residents in the area, the ratepayers association and individuals, complaining about a noise level,” says Vaughan local and regional Coun. Mario Racco. While it’s normal for city staff to check out complaints, “in this case seems to me that they have done it more often than they should have. So I think that bylaw was a little more, should I say, a little more willing to attend because somebody raised the issue.”

Is it discrimination? Racco says he can’t judge that. “But what I can tell you is that there is discrimination anywhere in this country.

“If we are doing things by the books, by the law, but you perceive that you’re being discriminated, then quite frankly, we have some responsibility because, you know, we are in the service business,” he says.

In a May meeting with Iyamu and Onuwelu, a city staffer had said the violations were “minor” and “not unusual in a business as we get into spring and summer.” But last month, the city told the Star it had found the lounge in violation of its noise bylaw 12 times and laid fines of $750 each time. That was also the first time the owners heard there were violations worth $9,000. They say they only received three tickets and have yet to see the other nine.

It hasn’t just been noise on authorities’ radar, though.

On the March 10 weekend, which was the start of March break, the restaurant was almost at capacity with about 130 customers, when eight or 10 police officers walked in with a bylaw officer, Iyamu and Onuwelu said. They said they wanted to check if every server had their “Smart Serve” licence -- a certification given to everyone who serves alcohol. All of them did, Iyamu said. Then they checked the eight security guards. Three of them had expired licences, their renewal applications stuck in the COVID-related delay. The police ticketed them $150 each.

“It was like a shakedown,” Iyamu says. The experience also left the mostly Black patrons frazzled.

On weekend nights, the owners would spot a van with private security guards in the parking lot until the wee morning hours.

More shocks were in store.

Locked out
One of the recurring issues around Festac’s operation has been what the operation is -- a bar, a restaurant, a lounge, a nightclub.

When Iyamu and Onuwelu had applied for a licence to run their business in 2021, Vaughan offered only the category of “eating establishment.”

In November, a month after Festac Lounge opened and unbeknownst to the owners, the city amended the bylaw to create new business licence categories: “lounge,” “nightclub” and “pub.”

In this definition, a nightclub offers music principally for dancing or listening and food services are secondary. A restaurant has 70 per cent of the floor space toward serving and dining. A lounge is somewhere in between.

In February, the landlord provided the Festac owners with notice of default of its agreement, alleging they were treating the place as a nightclub, not a restaurant. It said the building insurer said it was unable to insure a building that had a nightclub operation.

A quick glance around the restaurant shows it is filled with tables. There is no dance floor.

“We love music and we dance,” says Martin of advocacy group ANCHOR. “If you guys want to sit and eat your dinner and just leave, that’s fine. That’s your culture. But when we hear our music, we shimmy, and we dance. That’s what we do. So that is not a club.”

On April 3, the owners came to the site to find a big lock on the door. The landlord had locked them out, saying they’d defaulted on their agreement, that they were running a nightclub.

“They give us five days to pack our things and get out,” Iyamu says.

The duo called the lawyer then representing them, who called a locksmith who opened the locks. A city official came, heard their story and left them alone, the owners say.

After a meeting with Mayor Steven Del Duca, Coun. Racco and other staff, Iyamu said, city officials have been working with them, ensuring Festac now has the new category of “lounge.” There are no zoning restrictions on operating a lounge in that neighbourhood.

“The city continues to go above and beyond standard procedures to support Festac Lounge’s efforts to operate their business lawfully,” the city said in its statement.

“If Blacks are not needed in Vaughan, let them speak it. We will not come,” Iyamu told the city officials at their May meeting.

‘I didn’t do this to sell it’
Summer is here, but the Festac owners still don’t have that patio they had envisioned -- something they’d need consent from the landlord to put in.

The landlord has billed Iyamu and Onuwelu about $90,000 for the landlord’s legal fees, for locking them out and for private security costs; it turned out the security vans in the parking lot were hired by the landlord. Roybridge also increased Festac’s insurance payment by 600 per cent to pay the premium for a new insurer.

Among the landlord and the insurer’s new demands: insurance for weapons of any kind.

How did the question of extra security and weapons -- that is in line with the ratepayers’ “concerns” around nearby schools and connections with Festac in New York -- come up? The Star asked that, among other questions to the legal representative of Roybridge Holdings, but did not get a response.

Meanwhile, ANCHOR and a second community group, Italian-Canadians for Black Lives, requested an investigation into the ratepayers group and its influence. Late last month, the city told the Festac Lounge owners it had initiated an investigation.

Both Iyamu and Onuwelu say there is no way are they leaving a place they just put their heart into creating. They have sunk approximately $1.7 million into the project, not including rent, personal labour and other miscellaneous costs. They have taken two or three mortgages on their homes.

“We have no choice,” Iyamu says. “We have put so much money into it. I didn’t do this to sell it.”