Former supermarket operator Great Atlantic & Pacific Tea Co. has agreed to sell back to its landlord the lease of its now-vacant Pathmark store in Dix Hills for more than $400,000, court records show.
LG Other Associates LLC, based in Hewlett, is looking to pay $400,000, plus make a $47,000 payment to return rent paid by A&P in November, in exchange for terminating the lease of the Dix Hills Pathmark, according to a filing Monday with the U.S. Bankruptcy Court in White Plains.
LG Other Associates did not respond to requests for comment. A hearing to approve the sale is scheduled for Jan. 22 in the White Plains court.
“Landlords will buy back leases if they think leases proposed to be assigned are at under market rental rates,” said John Westerman, a bankruptcy attorney based in Uniondale who represented companies and landlords who purchased leases from A&P. He said landlords can then lease the property out at higher market rates to a tenant of their choosing.
A&P filed for Chapter 11 bankruptcy protection from creditors in July. So far, 34 Long Island A&P-owned stores have been bought or bid on, five were closed in October, and 12 other stores remain unsold. All the stores ceased operation by A&P in November.
Separately, A&P received earlier this month a $1 million offer from Mount Vernon-based K-50-15 Corp., an affiliate of Foodtown operator PSK Supermarkets, for its Pathmark intellectual property assets. Those included the Pathmark logo, the Pathmark.com domain name, and Pathmark Twitter and YouTube accounts.
Last month a bankruptcy judge approved a bid from PSK Supermarkets for the Waldbaum’s in Rocky Point and a Pathmark in Manhattan, for a total of $19.4 million. Foodtown already operated five stores on Long Island, according to its website.