Rite Aid tabs 39 more stores to be shut

Another 131 Rite Aid stores have been flagged for closure or lease sales as part of the drug chain’s Chapter 11 bankruptcy reorganization plan.

In motions filed this month with the U.S. Bankruptcy Court for New Jersey, Philadelphia-based Rite Aid identified 39 stores in 10 states that it aims to shut. They include 10 stores in Michigan, eight in Pennsylvania, six in Washington, four in Maryland, four in New Jersey, two in California, two in Ohio and one apiece in New York, Delaware and Oregon.

Four of the Washington stores to be closed are Bartell Drugs locations. Rite Aid acquired the Puget Sound-area drug chain, with over 60 stores, in the fall of 2020.

Plans call for a final hearing on the Nov. 2 and Nov. 7 store closing motions to be held on Nov. 16, according to the court documents.

This week, A&G Real Estate Partners—serving as an adviser to Rite Aid in the store divestiture process—also announced 92 additional Rite Aid and Bartell store leases up for sale in eight states.

New York-based A&G said the new tranche of leases up for sale include stores in Michigan (22), California (17), Pennsylvania (17), New York (11), Washington (10), New Jersey (seven), Maryland (six) and Ohio (two). Of the Washington locations, six are Bartell Drugs and four are Rite Aid stores.

Related:Rite Aid identifies initial 154 stores for closure under bankruptcy plan

Ranging from 5,000 to 33,548 square feet, the stores include 53 freestanding locations (44 with attached one- or two-lane drive-throughs) plus 36 stores in strip or power center sites, A&G said, adding that three also are in central business districts. The real estated firm noted that, including options, all of the 92 additional leases being marketed by Rite Aid have more than 10 years of remaining term.

“The lack of new build of this type of product is driving demand for these leases,” Andy Graiser, co-president of A&G Real Estate Partners, said in a statement. “We continue to be pleased by the strong interest we are receiving across the country from potential replacement users.”

Pending court approval, the store leases will be available via private sales. A&G added that more tranches of leases are in the offing as Rite Aid assesses its properties and additional store closings under the financial restructuring process.

“In consultation with A&G, Rite Aid is working to strengthen its overall financial position by reducing its rent expenses and optimizing its portfolio,” according to Graiser. “As it does so, other retailers and investors are now able to acquire leases and properties that once were out-of-reach locations in attractive markets across the United States.”

Related:What’s left for Rite Aid?

Rite Aid operated 2,111 stores in 17 states under the Rite Aid and Bartell Drugs banners when announcing its Chapter 11 filing on Oct. 16.

In court filings that day, Rite Aid said it earmarked 154 stores in 15 states for closure, while on Oct. 17 A&G announced that the drug chain put up 99 store sites for sale in 12 states under its Chapter 11 plan.

The initial group of stores tabbed for closing by Rite Aid included locations in Pennsylvania (39), California (31), New York (20), Michigan (19), New Jersey (12), Washington (11), Maryland (six), Ohio (six), Virginia (two), Delaware (two), Idaho (two) and one each in New Hampshire, Oregon, Massachusetts and Connecticut. Four of the Washington stores to be shut are Bartell stores.

A&G had unveiled plans to market 78 Rite Aid and Bartell leases in nine states plus 21 fee-owned properties in 11 states. Those included sites in California, Michigan, New York, Pennsylvania, New Jersey, Washington, Maryland, Ohio, Oregon, New Hampshire, Alabama and Idaho.