WASHINGTON -- The gale force wind from Toronto struck DC December 2nd with the announcement by Natural Markets Food Group CEO Robin Michel that the Spring Valley Fresh and Green's would close by the end of the month, perhaps by December 15th. The unexpected Christmas gift was a shock to the store's 40 plus employees, several of whom have worked at the location for 25 years.
Michel, who came to the Natural Markets parent of Fresh and Green's a year ago, was previously a top executive at Sears Holdings, run by billionaire investor Eddie Lampert, and before that at Giant Foods in Landover, MD.
She said the closing of the six Fresh and Green's stores in Maryland and DC acquired in the 2011 Super Fresh bankruptcy auction was "a very difficult business decision." Despite the company's best efforts, she said, the stores "remained unprofitable."
Several Spring Valley employees dispute that assertion, arguing that their store does make money. Some regard the closure is an attempt by the Toronto-based hedge fund that owns Natural Markets to destroy the union, Local 400 of the United Food and Commercial Workers Union (UFCW). Cashier Sally Crabbe, a 27-year veteran at Spring Valley, predicts the site will eventually reopen as a non-union Mrs. Green's, one of five brands in the Natural Markets portfolio.
In November, Natural Markets announced that company is expanding and "taking the Mrs. Green's concept" to several US and Canadian locations. The company has reportedly acquired another DC location. The Mrs. Green's franchise emphasizes nutritious and organic foods, combining grocery shopping with nutritious take-away meals. Catalyst Capital, the company's private equity owner in Toronto, indicates that an initial private offering of shares is planned.
Catalyst Capital, the Toronto private equity shop headed by Gabriel de Alba, declares on its website that it is a "leader in active, distressed investing." Its holdings include YRC trucking, a casino, and manufacturing. Catalyst Capital has been involved in food service since 2006 when it acquired in bankruptcy Richtree Market, the company that was the buyer of Super Fresh stores in 2011.
When Richtree/Natural Markets came to Spring Valley store employees agreed to a 10% wage reduction, the price for retaining the union as bargaining agent. The current contract expires in June.
Cashier Sally Crabbe is thankful that her health insurance continues until the end of the month as she is scheduled for cancer surgery before Christmas. Health plans for most employees terminate January 1. Employees with long tenure include parking lot porters Donald Andrews, 27 years, and Tim McLeod 22 years, and butcher Don Looney who has been with A & P and its successors for 50 years. The Spring Valley supermarket opened in 1964.
The owners of the property, Robert and Paul Burka, attempted in a court filing to stop the Richtree/Natural Markets purchase in 2011. They argued that the Toronto firm had neither the experience nor the money to operate profitably.
Jeff Metzger, the publisher of Food World in Columbia, MD, wrote that the Canadians overpaid for the bankrupt Super Fresh stores and that their operation "was doomed from the start."
Matt Williams, then chief executive of Richtree/Natural Markets, assured employees and customers that the Spring Valley store would be extensively renovated, including the addition of a café and coffee bar. The promised renovations never occurred.