FAILURE to meet its rent repayments has thrown the future of Rite Aid into turmoil once again, and shoppers fear the worst.
The pharmacy chain failed to pay its rent for April for some of its US stores, just months after it emerged from bankruptucy.
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Rite Aid has been battered and bruised in recent months, clawing itself out of bankruptcy in September 2024.
Drastic measures were taken, which saw Rite Aid cut $2 billion in debt and taking itself private.
Its physical presence has also decreased substantially, going from more than 40,000 spots nationwide 30 years ago to just 1,400 in the third quarter of 2024.
Now, business is teetering on Long Island, as the pharmacy failed to live up to its rental agreement for several of its locations in the area.
Long Island Business News reports that Rite Aid now only operates 13 stores there, and is still struggling.
Rite Aid has been a tenant at a 12,500-square-foot building on the island owned by MGD Investments.
Rite Aid has been there for 30 years.
The principal of MGD Investments Larry Weinberger tried to get in touch with the company when it failed to meet its April rent.
After several attempts, he was eventually told by real estate staff that they’ve been directed by ownership not to release rent funds.
This means that the future of Rite Aid on Long Island is in doubt.
PAY UP
Weinberger told the outlet: “We’re very disappointed that Rite Aid is still having issues…they have been wonderful tenants in that building since we acquired it and leased it to them almost 30 years ago.
“They have been wonderful tenants and just a few years ago they rebranded to the new colors and renovated the entire exterior and interior.
“I’m hoping they can make it, but we are currently analyzing the site for best uses should Rite Aid not make it.”
The same issue has been reported in another area there.
Rite Aid has been the anchor tenant at the Tanzi Plaza shopping center since 1998, and occupies roughly 9,000 square feet.
The landlord Tony Tanzi has also said that Rite Aid has not paid its rent for the spot.
He added: “They’ve been a good tenant, and we’ve always had a great working relationship.
“It’s a shame if they go out.”
“A MARGINAL COMPANY”
The writing may already be on the wall, according to a previous landlord of a Rite Aid location.
Basser Kaufman owns about 3 million square feet of retail property on Long Island, in Connecticut, Massachusetts, New Jersey and Pennsylvania.
The company had had Rite Aid in two of its spots before they closed a few years ago.
Basser Kaufman principal Steve Kaufman said: “When you start calling your real estate contacts [at Rite Aid] and they’re no longer there or don’t answer your calls, that’s a sign.
BRANDS HARD HIT BY BANKRUPTCIES
Many chains have struggled to adapt to a post-Covid retail landscape, with several companies filing for bankruptcy
“It’s not a surprise. That business has changed.
“It’s been a marginal company for many, many years.”
The Wall Street Journal is now reporting that Rite Aid is considering filing for another bankruptcy or selling more locations as an alternative.
It is important to note that this has not been directly confirmed by Rite Aid.
The US Sun has reached out to the pharmacy chain for comment on the story.
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