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Capitol Hill’s two QFCs on sale list in massive Kroger-Albertsons merger plans — UPDATE

The Harvard Market QFC at Broadway and Pike

Kroger shut down the 15th Ave store three years ago

As Kroger and Albertsons work toward a $25 billion merger, there might soon be a Capitol Hill without any QFC grocery stores.

Both of the Broadway QFC locations are included on the “Planned Divestiture Store, Distribution Center, and Plant Locations” list (PDF) released Tuesday by the companies as they seek federal approval for the massive deal.

In Tuesday’s announcement, officials at QFC-parent Kroger and Albertsons said the merger will include the $1.9 billion sale of 579 stores across the country including 124 in Washington that would be acquired by C&S Wholesale Grocers, owner of the Piggly Wiggly brand. It is possible the Broadway QFC stores included in that deal could someday become Piggly Wiggly groceries.

It is also possible the Massachusetts-based company might have other plans as the industry continues to adjust to the soaring cost of labor and growing markets for grocery delivery. There were few promises for consumers in Tuesday’s announcements and, in a letter to employees, Kroger CEO Rodney McMullen said Tuesday only that the company is “confident that C&S will provide the transferred associates stability and opportunities to further enrich their careers with a growing company.”

The release of the list including the divestiture plans for the two Broadway QFCs comes amid major uncertainty for big brand grocery chains in the neighborhood.

In 2021, national grocery giant Kroger axed the 15th Ave E QFC location in a tiff with the Seattle City Council over COVID-19 hazard pay. Property owner and Capitol Hill developer Hunters Capital now has plans for a six-story, 170-unit, mixed-use building with about 10,000 square feet of ground floor commercial space to eventually rise on the block. In the meantime, Hunters has been trying to keep the space activated.

On Broadway, the QFC chain has struggled with challenges around the pandemic and the fentanyl crisis as the company is employing increasingly expensive security and infrastructure to curb street disorder and shoplifting in the stores both in the Broadway Market location and the Broadway at Pike Harvard Market location.

The Harvard Market store is especially challenged as area business leaders have asked the city to do more to respond to drug use and sales and street disorder around the Broadway at Pike store. The city auditor just added the blocks to its roster of ten locations across the city where overdoses and crime are most concentrated.

Security surveillance equipment above the Broadway Market QFC

Beyond the Kroger and QFC tumult, retailing giant Amazon has also pulled the plug on its grocery aspirations on E Pike. In April, it shuttered the street’s Amazon Fresh grocery as part of a nationwide pullback on its smaller format stores in favor of larger groceries and its Whole Foods holdings — including the Whole Foods store a few blocks away at Broadway and Madison.

That Whole Foods is poised to be an important store as the changes churn through the industry. Madison’s independent Central Co-op and the Capitol Hill location of the Trader Joe’s chain will also likely face longer lines ahead.

Broadway’s M2M market from the H Mart chain of Asian groceries opened above Capitol Hill Station in 2022.

Meanwhile, a planned mixed-use redevelopment that will eventually create a new home for City Market has been on hold as a new developer has been sought for the project.

One core Capitol Hill grocery store not on the merger chopping block might also not be around for a while. Safeway is part of the Albertson family of grocery chains and many of its stores across the country are also up for divestiture as part of the planned merger. The Capitol Hill Safeway at 15th and John isn’t on the sale list but its future also includes a shutdown. The property is lined up for redevelopment that will create two new five-story buildings including a new grocery, around 330 market rate apartment units, some new, smaller retail spaces, and an underground parking lot for more than 300 cars.

Plans had called for demolition of the 15th and John store and the start of construction this year and a possible 2026 opening of the project. It remains to be seen how the redevelopment plans and the merger plans will come together.

Meanwhile, the neighborhood’s grocery history might be reconnected with the possible changes. There were once Piggly Wiggly stores on Broadway and on 15th Ave.

UPDATE: They might be part of the Piggly Wiggly family but the Broadway QFC stores could keep their “banner” names. Under terms of the acquisition deal, C&S is also adding the QFC, Mariano’s and Carrs labels to its brand portfolio.

The release of the divestiture list comes as regulators will ask a federal court in August for a preliminary injunction against the merger while the deal is examined for antitrust violations, six months after the Federal Trade Commission filed suit to halt the deal and possible divestitures.

Recent closures of big chain pharmacy locations of Bartell Drugs and Rite Aid on Broadway are also fresh in the minds of neighborhood shoppers.

QFC installed cameras at the self-checkout kiosks in 2019 to deter theft

 

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36 Comments
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Hillery
Hillery
9 months ago

I hope the new owner – if this somehow got through- has better security and solutions than QFC now. Outside is a drug den, filthy and way too much shenanigans. Granted part of the onus is on the city and property management.

Local
Local
9 months ago
Reply to  Hillery

More likely it gives them an excuse to exit difficult locations – I can’t imagine anyone taking them over.

Boris
Boris
9 months ago
Reply to  Local

C&S has committed to buying them.

Stephen
Stephen
9 months ago
Reply to  Boris

Like how Haggen bought all those stores in the Safeway/Albertsons merger! (most of the transferred stores failed, and then Safeway/Albertsons bought the remnants back).

Suddenly coming into control of 100+ stores simultaneously isn’t a recipe for a thriving and stable business.

Boris
Boris
9 months ago
Reply to  Stephen

Yes, that’s one negative example. There are plenty of positive examples too…like when Kroger bought QFC and Fred Meyer.

I would actually argue that coming into control of a huge number of mostly very successful stores in one area is a recipe for a thriving and stable business. Being tossed some remnants (as happened in the Haggen example) is not a recipe for success.

Neighbor
Neighbor
9 months ago
Reply to  Boris

I kinda liked the pre-merger QFC/Fred Meyer separate stores. Having an affordable everything store (20 years later still using the self-assemble shelves) was super handy. FM also had a well-used pharmacy, which I’m unsure if still exists at the north-end QFC. IMO corporate consolidation rarely benefits local consumers.

Boris
Boris
9 months ago
Reply to  Neighbor

the pharmacy is still there – best kept secret imo, as it’s not very crowded compared to others

cap_hill_rez
cap_hill_rez
9 months ago
Reply to  Boris

Committed to buying them, yes. But has not definitively committed to keeping them open.

Boris
Boris
9 months ago
Reply to  cap_hill_rez

Sure. There’s no current commitment for Albertsons or Kroger to keep any stores open either though…as witnessed by the 15th St closure a few years ago.

Closures
Closures
9 months ago
Reply to  Boris

C&S is buying an assortment of stores at a below value price, some are gems others will need to be closed immediately. Closing some of the stores will give them a tax break/write down the costs.

Boris
Boris
9 months ago
Reply to  Closures

I’m unclear why others would need to close immediately. Why hasn’t Kroger or Albertson’s closed them already if they’re so terrible?

Local
Local
9 months ago

Wow. That would be like an asteroid hitting Broadway – vast empty retail holes. The Safeway is also scheduled for redevelopment. Profitable for TJ, but I don’t think they would cope.

Boris
Boris
9 months ago
Reply to  Local

They wouldn’t close, C&S has committed to buying them as part of the merger deal. Now of course they could close them later, but that’s not in the plans and would be unlikely to happen in the first few years at least to avoid antitrust scrutiny.

Ronadl Duck
Ronadl Duck
9 months ago

“Alright babe ima go to piggly wigglies real quick be right back”

Accountability
Accountability
9 months ago
Reply to  Ronadl Duck

We just call it ‘the pig’ in the South.

Hillery
Hillery
9 months ago
Reply to  Accountability

And the ones in Wisconsin too. Shop the pig!

Matt
Matt
9 months ago

There was also the departure of the Naked Grocer 😕 I would love to see more government support for small local grocers that provide fresh produce

Boris
Boris
9 months ago
Reply to  Matt

small = expensive

Matt
Matt
9 months ago
Reply to  Boris

It doesn’t need to be, and a large reason they are is because taxpayers pay large subsidies for “staple” crops that often get sold back to us as highly processed foods like high fructose corn syrup and hydrogenated soybean oil…

Boris
Boris
9 months ago
Reply to  Matt

Sure, I’m on board with eliminating ag subsidies. That won’t help to lower the prices of small crops though. Are you saying we should subsidize small? Why is small better? You can grow non-staple through big farms too.

Matt
Matt
8 months ago
Reply to  Boris

Geez you’re dense…

The large grocery stores are selling mostly highly processed foods, much of which is made from heavily subsidized cash crops that aren’t very nutritional. If we instead considered crop subsidies with some level of nutritional value in mind we would see more farms growing these (big and small) and therefore cheaper fresh nutritional food grown in the US and hopefully available at our stores.

What large grocers offer over larger ones is their “variety” of taxpayer subsized cheap processed foods that requires a lot of floor space, and since we currently provide little to no subsidies for healthy nutritional produce, small grocers then would have an easier time providing fresh healthy produce, which can sometimes be a draw to these places and definitely was at Naked Grocer.

SoDone
SoDone
9 months ago

I feel like I am already in a pharmacy desert with only one provider downtown taking my direct prescription for same day refill. During covid, without a car, I visited Safeway 15th, a few trips to QFC 15th, and both Broadway QFCs for weekly shopping items. Shopping the Hill has become far more limited in the past 30 years, I worry that this may cause far more limited options. … I won’t have to want to rely on Amazon or online for same day options… nor have a long transit commute there and back for basic items.

Tim
Tim
9 months ago

Well… troubling news aside, I’m not a fan of utilizing those qfc. It is pretty rough on Broadway and those two qfc are focal points for unsavory pedestrians and the chronically unhoused. If I were a capitalist, I’d tell my customers to drive over to me, and here is a gas coupon for shopping. I mean only capital hill will be hurt, not Whole Foods TJ’s and the coop.

I guess it’s fried chicken and pizza again, not that I’m complaining. The pizza is vegan so I can have the chicken too. But seriously a possible food desert in a densely populated neighborhood is pretty alarming.

Boris
Boris
9 months ago
Reply to  Tim

Food desert? These stores aren’t closing.

cap_hill_rez
cap_hill_rez
9 months ago
Reply to  Boris

You can’t say that for sure. Even if the merger falls through, QFC might decide to pull out of Capitol Hill completely given the costs of security and combatting ongoing theft. As you said in a previous reply to me, QFC closed the 15th Ave store a few years ago.

A corporation wanting to shed such liabilities, even after buying them as part of a larger acquisition, wouldn’t be too hard to fathom. They can recoup as much as they can by selling off store equipment and then take whatever loss as a tax write off.

Boris
Boris
9 months ago
Reply to  cap_hill_rez

Yes, but they could do that now? The idea that they’re more likely to close now seems based on nothing.

d4l3d
d4l3d
9 months ago

Kroger is the 24th largest American corporation but, unlike their counterparts who manage just fine, they have selectively “lost” control over these two (once three) markets in close proximity. Given how modern capitalism works at the highest level, I don’t think so. These were pawns in a long game.

Boris
Boris
9 months ago
Reply to  d4l3d

They’re also selling most of the eastside stores in tony Bellevue neighborhoods. There’s no conspiracy here.

Casey
Casey
9 months ago

Tbh I’d love them both to close and be replaced with something that doesn’t attract so many vagrants.

cap_hill_rez
cap_hill_rez
9 months ago
Reply to  Casey

That doesn’t make a ton of sense. Close grocery stores in a very densely packed neighborhood because – vagrants? How about mitigate the causes of the vagrants hanging around and eliminate that as an issue?

Your solution is like saying, “I keep getting rashes on my arm. I should cut it off to stop getting rashes.”

John Whittier Treat
John Whittier Treat
9 months ago

Shoplifting and drug deals. This is why we can’t have nice things. Or even groceries.

Diana
Diana
9 months ago

“On Broadway, the QFC chain has struggled with challenges around the pandemic and the fentanyl crisis as the company is employing increasingly expensive security and infrastructure to curb street disorder and shoplifting in the stores both in the Broadway Market location and the Broadway at Pike Harvard Market location.”

Their ridiculous security measures also dissuade people from shopping there in general.

LHS
LHS
9 months ago

Bartell’s all over again

Andy
Andy
9 months ago

Bring in the Wegmans

Hillery
Hillery
9 months ago

How about another Trader Joe’s to relieve pressure from the Madison one they can get crazy over there.

Boo
Boo
9 months ago
Reply to  Hillery

More expensive than QFC.