Bet on Grocery in Downtown Cleveland Didn’t Pay Off

Heinen’s will close a grocery store it has operated in a downtown Cleveland landmark since 2015, report a variety of sources, including  Ideastream Public Media and Signal Cleveland. The reasons behind the closure reflect the many challenges such spaces face.

The store in question, housed on the ground floor of the historic Cleveland Trust Building at Euclid Avenue and 9^th Street, will close July 31. The store was expected to be magnet for commerce in the area and a way to attract downtown residents; it did become a staple for the growing downtown population as more offices were converted to apartments, Ideastream noted.

“We were willing to make that bet as life-long Clevelanders even though we believed we might never make any money,” Jeff Heinen, co-president of Heinen’s, said in a news release reported on by Signal Cleveland. “Fast forward 11-plus years and over $18,000,000 in cash losses and we knew we put our best effort forward and it was not good enough.

“We understand our closing creates uncertainty for residents who rely upon the store yet as a family run business operating in a very competitive industry, that level of losses is not sustainable.

“We wish it would have been a more favorable outcome. Despite ongoing adjustments, the store did not reach the level of long-term sustainability needed to continue operating.”

One of the adjustments Heinen referred to included shrinking the downtown store’s footprint to try to save money in 2024 and 2025 by moved its beer and wine offerings from the rotunda’s second floor down to the first floor.

That enabled the company to save roughly $40,000 on its property taxes for the second floor, but it didn’t see operating expenses go down, Heinen wrote.

Michael Deemer, CEO of development agency Downtown Cleveland Inc., said affordability of Heinen’s goods was one factor that could have led to its closure, in addition to changing consumer habits. “We see residents getting groceries from affordable, convenient options, whether that’s through delivery, whether that’s driving to other locations,” Deemer said.

Going forward, Deemer said his group and other private and governmental agencies in the area will work “to make sure that we’ve got affordable, convenient grocery services to meet the demands of downtown, whether it’s in that space or not.”

Privately held Heinen’s, founded in 1929, operates 18 other grocery stores in Northeast Ohio and five in Illinois, its website says.