Fairway's Future Looks a Little Brighter

ShopRite owners plan to buy five Manhattan locations as company files Chapter 11

27 Jan 2020 | 02:20

Last week was a rocky one for the Fairway faithful.

After rumors circulated that the beloved New York grocer could shut its doors forever, a report from the New York Post seemed to confirm customers’ worst fear: Fairway Market would be closing and liquidating all of its stores.

But that report was quickly disputed by Fairway, which put out a statement that it has no plans to file Chapter 7 bankruptcy and close all of its stores.

The reality of Fairway’s fate was revealed Thursday when the market filed Chapter 11 bankruptcy and announced it would sell its five Manhattan locations — the Upper West Side flagship, Upper East Side, Harlem, Chelsea and Kips Bay — and its distribution center for approximately $70 million to Village Super Market, Inc., the parent company of ShopRite.

“After careful consideration of all alternatives, we have concluded that a Court-supervised sale process is the best way to meet our objectives of preserving as many jobs as possible, maximizing value for our stakeholders, and positioning Fairway for long term success under new ownership,” said Abel Porter, Chief Executive Officer for Fairway.

About 2,300 Fairway workers in the New York area are represented by UFCW Local 1500, according to a report from the Times. A union representative could not be reached by press time.

Fairway has struggled since the Glickberg family, who had owned and operated the chain since it opened as a produce stand in 1933, sold their stake to a private equity firm in 2007.

Since then, the company has seen losses as it has expanded outside on New York City and out to Connecticut and New Jersey. In 2016, it filed Chapter 11 bankruptcy for the first time, and was eventually brought out of it by another investment firm.

The grocery stores will remain open during the process and the court will supervise the sale of the remaining markets in the tri-state area.

"Concerned About the Future"

To the relief of longtime Manhattan customers, Fairway will keep its name and signature, specialty products under the new ownership.

“We appreciate that Fairway's loyal customers are concerned about the future, and if we are successful in our bid, we are committed to keeping Fairway, including its name, unique product selection and value, a part of this community,” said Robert Sumas, CEO of Village Super Market, Inc.

The Sumas family owns and operates Village Super Market, a family run grocery chain that operates 30 ShopRite stores in New Jersey and one location in the Bronx. In 2019, Village purchased three Gourmet Garage stores in Manhattan and has maintained them.

On Monday, customers at the Upper West Side location were relieved that Fairway would remain open.

Norb Joerder, who has lived on the Upper West Side for 35 years, said that it’s the only true market in the neighborhood.

“There’s Whole Foods and Trader Joe’s — but we used to have Westside Market. We used to have D'Agostino’s. They’re all gone,” Joerder said. “We have no choice. This is it.”

He did hope that shopping at Fairway might become a more pleasant experience under new ownership, referring to the cramped and crowded aisles.

“The little old ladies with their carts who run you over ... you might have to gird your loins before you go in there,” he said.

Robert Abdoo, who lives on the East Side, agreed with Joerder and hopes that ShopRite’s ownership will have a positive impact on Fairway and it’s prices. He said he sometimes shops at the Upper East Side location, but often opts to go to the Key Food near his apartment because it’s cheaper.

“The prices have really gone up in the last year or two. I don’t know if it’s because of California or what’s going on,” said Abdoo. “I’m hoping with ShopRite — where the prices are lower — that might have an impact.”

Another shopper named Ruth (who declined to give her last name) said that what matters most is that Fairway remains open.

“I need Fairway. My family needs Fairway,” Ruth said. “I do all of our shopping here.”

Ruth was not concerned about ownership changing hands and is confident that Village Super Market won’t make any drastic changes to the iconic grocer.

“It’s doing well,” she said. “If it ain’t broke, don’t fix it.”

"We used to have Westside Market. We used to have D'Agostino’s. They’re all gone. We have no choice. This is it.” UWS Fairway customer Norb Joerder