A&P Asks Bankruptcy Judge To Break Millwood Lease

MILLWOOD, N.Y. -- Bankrupt supermarket chain A&P is asking a federal judge to break the lease for its shuttered store in Millwood. If the motion is approved, it would allow the property's landlord, Millwood Center, LLC, to recruit and sign a new tenant outside of the bankruptcy process. 

The former Millwood A&P site.
The former Millwood A&P site. Photo Credit: Tom Auchterlonie

The chain, which is officially called The Great Atlantic & Pacific Tea Company, Inc., filed its legal motion (request) on Thursday. 

Bankruptcy Judge Robert Drain is being asked to approve A&P's request. The legal term for breaking the lease is known as a rejection.

A&P's Millwood store lease dates back to 1969, the motion notes. The grocery chain vacated the property late last year.

The Millwood site has been through several procedural twists and turns since A&P filed for bankruptcy last summer. The lease for the storefront, located at 230 Saw Mill River Road, was originally intended to be acquired by fellow grocery chain Acme as part of its "stalking-horse" bid. The storefront was subsequently included in an open auction, which was held last October. 

Ruben Luna won the auction and transferred purchasing rights to an entity controlled by his brother, Jamie. The entity is called Millwood Merchant, LLC and the lease sale was worth $2.4 million.

Millwood Merchant abandoned its purchase bid in November and A&P sued the company, along with Ruben Luna, the following month. 

A&P has not yet been successful in its litigation, nor has it lined up a new buyer for the lease.

"The Debtors have not identified any other purchaser for the Lease and have not been able, to date, to compel the original bidder or contract counterparty to consummate the original transaction," the company's motion states.

Breaking the lease is intended as a cost-cutting measure for A&P, according to the motion.

Objections to A&P's motion are due by April 21 at 4 p.m., while Drain is slated to hold a hearing on the matter on May 12 at 10 a.m. The hearing will be held at the federal courthouse in White Plains.

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