A prominent Chicago gourmet foods retailer, Fox & Obel, recently announced that it will be filing Chapter 11 bankruptcy protection. The move come after a string of failed health inspections and a stiffening of competition in the area, an area of the city in which Fox & Obel was once the sole outlet for gourmet foods. Sources close to the case says the company had been having trouble making rent in recent months and decided to file for bankruptcy after much deliberation.
Inside the Filing
Although the gourmet foods retailer had had several failed health inspections, including some that found significant cockroach and fruit fly presence in food prep areas, the bankruptcy lawyer involved with the case says that Fox & Obel’s main problem was the increased competition in the high-end grocery market. Whole Foods recently moved into the neighborhood, and grocery stores like Dominick’s have stepped up their high-end produce and prepared foods offerings in recent years. Fox & Obel once had the market all but cornered, with a prime location on the way to Chicago’s Navy Pier, but when competitors moved in they were able to price Fox & Obel out.
At the time of the Chapter 11 filing, the parent company of Fox & Obel showed assets of $1 million with debts of over $10 million. Much of the debt is tax debt owed the IRS, with significant portions owed to the wholesalers and investors. The company also owes several months back rent on the property. It remains unclear, whether the store will remain open after the bankruptcy process is completed.