Beloved coffee chain files for bankruptcy

A much-beloved East Coast coffee chain has announced that it will file for bankruptcy, citing ongoing post-coronavirus pandemic issues, according to a report from QSR Magazine.

Compass Coffee, a 25-store chain in the Washington D.C., Maryland and Virginia area, filed for bankruptcy last week, with plans to sell the chain to a “strategic buyer,” according to QSR Magazine.

The chain will also end the leases on 10 locations that have shown to be unprofitable, including a former headquarters and in-house roastery, the outlet reported.

The company owes over $11 million in debt and has been sued several times over issues of non-payment. The founder of the coffee company says that revenues fell during the pandemic and foot traffic has never really rebounded, especially among government employees, the report says.

“Foot traffic downtown has not returned, work patterns are different, and the economics of running urban cafes look very different than they did even a few years ago,” Michael Haft, Compass Coffee’s cofounder and CEO wrote in a LinkedIn post.

“This has been a difficult chapter. The decisions we’re making reflect the reality of this moment in Washington and are about ensuring Compass can continue serving the city,” Haft continued.