[img id=”80283″ align=”alignleft”] The Hyde Park Cooperative Society held a Board of Directors meeting Monday night to discuss the fate of the financially insolvent 55th Street grocery store, sparking a bitter debate about the supermarket’s future even as the University—which owns the Hyde Park Shopping Center—announced that it had narrowed its search for the store’s potential successor to Treasure Island Foods or Dominick’s.
“These grocers presented the strongest offers,” said Hank Webber, vice president for community and government affairs, of the University’s top grocery store candidates. “They are very interested, offered reasonable financial arrangements, and were willing to work in the current physical space.”
Though the University remains in negotiations with potential new grocers and the Co-Op’s choice to close or file for bankruptcy is to be determined, Webber said the stores in consideration were willing to invest approximately $5 million in the venture.
According to Webber, a student survey conducted last year on Hyde Park’s retail options elicited over 400 responses requesting an improved central grocery store, with similar results expressed in faculty and staff surveys.
The Co-Op recently mailed over 19,600 letters to shareholders explaining the supermarket’s predicament and laying out two options resulting in either the store’s closure or bankruptcy. A ballot was also sent to all shareholders in order to gauge community opinion, though the board will ultimately make the decision about the grocery store’s future.
A 75-year Hyde Park supermarket in debilitating debt to its University landlord, the Co-Op is considering closure, which would entail the University forgiving up to $1 million in rent and also require that the U of C provides additional funding to help the store pay off its debt. The University would then choose a new grocer to inhabit the 55th Street space.
The second option would allow the Co-Op to file for bankruptcy and enable it to terminate its lease of the 47th Street former Co-Op location at a cost of $2.2 million. The rent on that location has cost the Co-Op more than $6 million per year since it closed in 2005. While this plan would leave the Co-Op intact in its current form, failure to find additional funding could result in the store’s eventual closure, endangering employees and threatening to leave Hyde Park bereft of its single major supermarket.
“The Co-op has a glorious past….There is widespread sadness, a group of well meaning people who believe bankruptcy offers the option to restore the Co-Op to its glory days. My general belief is that this is an extremely difficult path,” Webber said.
A discussion of this difficult path took place Monday night between Co-Op board members and roughly 20 dedicated community members well versed in the complexities of the Co-Op’s business options.
“It’s been a challenging couple of weeks” said Bruce Brandon, a board member. “It affects everyone here, but especially the employees. It’s a really unstable time. Morale is somewhat of an issue.”
The board remains split on the issue of whether to accept closure or bankruptcy, though an informal poll conducted among board members resulted in a 6–3 vote for accepting the University’s closure proposal.
But community input, as expressed Monday night and at a recent town hall meeting, seemed to regard the store’s closure as a sacrifice of a community institution and a concession to a self-serving University, which had previously not disclosed potential choices for a new store.
“To struggle and go down in flames is a more moral decision,” said one board member to loud applause from the audience.
Yet on the subject of public sentiment, Webber noted that “it’s important to understand that there are tens of hundreds of members, and 300 or 400 at these meetings.”
Joel Reisner, a representative of the University in negotiations with the Co-Op, rose toward the end of the meeting to disclose the University’s choice of potential new grocers and to defend the University’s stance.
“This isn’t just an issue of the Co-Op succeeding or failing,” said Reisner. “If this store goes dark, what happens to the rest of the merchants in this quintessentially grocery-anchored shopping market? What happens to the rest of the merchants in Hyde Park? The University is very focused on improving retail conditions and making life better for all members.”
“You have to give us the fact that we’ve been major supporters of the Co-Op. We have conceded hundreds of thousands of dollars, we have been very supportive of the board,” added Reisner.
Addressing complaints that the closure option would leave current employees in the cold, Reisner said that the potential grocers had agreed to interview all employees to see if they would make a good fit for the new store. He emphasized that, under new grocer control, employees would end up at a higher pay level and likely receive better benefits.
James Poueymirou, board president, characterized the Co-Op’s negotiations with the University as honest and fair. “Mike [Lowenthal, a Co-Op board member] and I in our direct negotiations have found the University to be straightforward, honest, and fair, and the discussions cordial. I might add generous, as no one else has shown up on our doorstep offering $4 million. But some members of the board see the University as an 800-pound gorilla.”