Troubled Co-Op grocery checks out; Shareholders vote to accept U. of C. buyout offer

Bowing to economic pressures, shareholders of the 75-year-oldHyde Park Co-Op Markets on Saturday voted in favor of accepting afinancial buyout from their University of Chicago landlord andshuttering the debt-saddled cooperative grocery store by the end ofJanuary.

Co-Op board members who met Saturday said they expect to approvethe shareholder vote at Monday's open meeting.

"What we agreed to all along is that we'd respect the vote of theshareholders, and I fully expect that we will provide a fullapproval," said board president James Poueymirou.

A total of 2,049 shareholders voted to seek financing that wouldkeep the venerable South Side institution open. But 3,200 opted forthe U. of C.'s offer, which absolves the neighborhood landmark of$1.2 million in back rent, provides money to pay off creditors andreleases it from its lease on a failed location on 47th Street.

The Co-Op Markets' 181 employees, around 40 of whom work full-time, would lose their jobs.

The U. of C. is already negotiating with Dominick's and TreasureIsland to fill the space and says one of the chain grocers should bein the building by mid-February.

The vote was the culmination of a fierce, ideologically fraughtdebate between proponents of the store -- who felt it was improvingunder recent new management and could be rescued through acommercial loan and other emergency fund-raising -- and those whosaid the debts were too great and the U. of C.'s offer so good thatit was no longer possible to stay open.

MISSTEPS WRECK FINANCES

Meanwhile, some Hyde Park residents, who complained about the Co-Op's above-average prices and sometimes subpar service, didn't seewhat was worth saving at all.

"A top official at the university told me that he felt there weretwo issues," said board member James Withrow, who wanted to keep thestore open but will vote in favor of the closing plan. "Should theCo-Op go on, and can the Co-Op go on? I think this electionultimately was about both."

The Co-Op was founded in 1932 by a group of neighborhoodresidents hoping to save money during the Great Depression bypooling their resources and buying food in bulk. They expanded intoa members-owned store and moved into the present location, a 45,000-square-foot store at 55th and South Lake Park Avenue, in 1959.

Many Hyde Park residents had taken pride in having a community-owned supermarket that embodied progressive values and stocked awide range of products reflecting the rare diversity of theneighborhood.

Its members over the years included prominent liberal politicianssuch as former Ald. Leon Despres, retired federal Judge Abner Mikvaand former U.S. Sen. Paul Douglas, who is said to have advised theCo-Op's founders while he was a U. of C. economics professor.

But several financial missteps -- namely the failure of twosatellite stores -- crippled its finances. And the idealism of itsmission collided with the brutal reality of failed expansions,mushrooming debt, and increasingly frustrated customers for whomlofty values ceased to trump high prices and often shoddy service.

"The emotional attachment to the organization has been highwithin our community," said Poueymirou. "But the economic realitiespointed to [closing] as being the more responsible course ofaction."