Starbucks could close five more New York City stores, continuing a surprise purge that began in the fall – and Beijing-based rival Luckin Coffee is eyeing the already abandoned digs, The Post has learned.
The additional Starbucks closures are expected early next year, said James Famularo, president of Meridian Retail Leasing, which mostly represents landlords.
Another real estate source who is familiar with Starbucks’ plans and did not want to be identified said five stores could close due to leases not being renewed.
“I don’t see Starbucks ever opening as many stores in NYC as they closed,” the person told The Post.
Thirty-four NYC Starbucks abruptly closed Sept. 25 after six consecutive quarters of declining sales for the java giant.
Meanwhile, Luckin Coffee is looking to expand its Big Apple presence after opening nine stores in the city in just seven months, according to several real estate brokers who have worked with the company.
The chain, which runs more than 26,000 stores worldwide, is looking at numerous locations including smaller, to-go spots that Starbucks recently shuttered, the brokers said.
Luckin, which sells drinks that are about 30% cheaper than Starbucks’, trampled the Seattle-based chain when it tried to establish a foothold in Asia.
“There are a lot of negotiations going on involving Luckin,” Famularo said, adding that “more than a dozen spaces we represent are being looked at by Luckin. It wouldn’t be surprising if a year from now Luckin has quadrupled its spaces. They are that active.”
Luckin did not immediately respond to a request for comment.
The Chinese chain operates smaller cafes from 700 to 1,000 square feet that require customers to order ahead of time.
Starbucks is investing in locations where customers can linger – a nod to its roots when its cafes were places where people brought their laptops to work or socialized with friends.
The chain is reopening a shop at 1585 Broadway in Manhattan that closed during Morgan Stanley’s renovations of its headquarters in the building, said the source familiar with Starbucks’ plans. No other openings are in the pipeline, the person added.
“We regularly evaluate our portfolio of coffeehouses to make sure that we are meeting the needs of our customers. Opening and closing stores is a standard part of our business,” Starbucks spokesperson Sam Jefferies said in a statement to The Post.
The sudden closure of so many Starbucks earlier this year was a jolt to the real estate market. The chain was considered a desirable tenant that reliably pays its rent and draws foot traffic to the neighborhoods where they serve brews and snacks.
But in September, “they literally put signs in windows overnight without telling landlords and building managers,” Newmark retail vice chairman Jeffrey Roseman told told the Post at the time. “There was no warning, no heads up.”
Starbucks closed the most stores of any chain retailer in the US over the course of the year – 42 total in New York City alone, according to the Center for an Urban Future.
There are now 286 Starbucks in the five boroughs, down from 351 in 2019, the nonprofit said.
The NYC closures were part of a $1 billion restructuring plan that included closing 400 stores nationwide and laying off 900 corporate staffers.
Starbucks never fully recovered from the COVID pandemic, when employees began working remotely and giving up their daily coffee runs, say industry experts.
As companies tried to lure workers back to the office, they invested in perks like espresso and cappuccino machines.
“If you were a Starbucks customer who went to a store five days a week, maybe you go now three days,” said the real estate source. “Stores that used to be profitable lost business. That all adds up and is significant.”
Credit: Source link
