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Amazon Sued Over Multiple Unoccupied Fresh Stores

Landlords in 2 states have brought lawsuits against retailer for breach of contract
Emily Crowe, Progressive Grocer
Amazon Fresh Expanding in New England: Reports
Planned Amazon Fresh stores in Washington state and Pennsylvania have seemingly been abandoned.

Property companies in both Washington state and Pennsylvania have filed lawsuits against Amazon for breach of contract as several of the company’s planned Amazon Fresh grocery stores remain unoccupied. 

According to local reports, Boston-based CPT The Landing, which owns retail space that was slated to house an Amazon Fresh store in Renton, Wash., sued Amazon on May 15 for breach of contract after it backed out of the lease. Court documents show that Amazon said it was unable to get the necessary permits and approvals for the space, but The Landing asserts that the retailer made the move as part of its broader plan to re-evaluate its brick-and-mortar strategy.

An Amazon representative told The Seattle Times that the company occasionally makes “optimization decisions that can lead to closing existing locations or choosing not to pursue building a planned location.”

A separate lawsuit was brought against Amazon in March by Federal Realty Investment Trust, which owns the Willow Grove Shopping Center in eastern Pennsylvania, where an Amazon Fresh had been planned. The landlord alleged that Amazon did not make timely rent payments as specified in the lease, but Amazon countered on May 8, claiming that the landlord did not satisfy its obligations set forth in the lease; thus rent was not yet due.

The Bucks County Courier Times also reported that Amazon Fresh stores were expected to open in Bensalem and Middletown, Pa., but that both of those stores remain empty. The sign above the Bensalem store was also recently removed.

As it works to retool its grocery strategy, Amazon has pulled out of two planned Fresh stores in the Detroit area. The company is looking to sublease a space in Madison Heights that was going to house a Fresh location and has also terminated a lease on a former Kroger store in Dearborn.

Amazon is additionally subleasing six sites that were intended to be built out into full-scale Amazon Fresh stores in the Minneapolis area.

The news comes after Amazon CEO Andy Jassy confirmed that the company is still pursuing a grocery business, but taking the time to hone the concept for the most effective model. “We have a set of experiments and concepts that we are working on across the dozens of stores and are pretty optimistic that some may work and hopeful that over the next year we find that,” he said during the company’s quarterly earnings call in early May.

Seattle-based Amazon is No. 2 on The PG 100, Progressive Grocer’s 2023 list of the top food and consumables retailers in North America. PG also named the company one of its Retailers of the Century.

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