Freshgrocer, Penn continue negotiations

Penn real estate officials and Freshgrocer management continue to tussle over the future of the supermarket at 40th and Walnut streets, following last week's announcement that the project has been delayed indefinitely. University contractors continue to work on sections of the supermarket's floor, but the repairs are far from complete, according to Freshgrocer project manager Tony Varallo. "We will not open until they give us a date for completion," Varallo said yesterday. Freshgrocer operator Pat Burns announced last Thursday that the grand opening of the supermarket -- scheduled for April 1 -- would be pushed back until the University corrected all problems with the floor. Penn is responsible for construction of the project, a major piece of the 40th Street revitalization effort. Varallo said that The Freshgrocer's management had a meeting on Monday with Penn's top real estate official, Tom Lussenhop. "We had a meeting with the University to discuss [our] punch list [of concerns]," Varallo said. "There are over 180 items on our list that need to be addressed. A lot of them are major." Lussenhop declined to comment on the nature of the negotiations or on any potential opening date for The Freshgrocer, other than to say the supermarket would open "very soon." Burns claims that the store's tile and concrete floor was not installed properly, resulting in bumps, cracks and other visible defects. As a result, he has chosen not to open for business until the problems are corrected. Burns could not be reached for comment yesterday. Varallo said that the three major sticking points -- the condition of the floor, an inoperable conveyor belt intended to transport customers' groceries to the car garage above and a faulty climate control system -- still have not been addressed adequately. "We've come on deaf ears when it comes to the floors," Varallo said. But Penn's Vice President for Facilities Services Omar Blaik characterized the floor problems as "nothing major." Regarding the conveyor belt, Varallo said he has reached a point of near total frustration. "If customers can't get their groceries, who's going to shop here?" he asked. According to Varallo, the University has offered "no commitment as far as [the] completion" of the repairs. Lussenhop, however, has maintained the University's commitment to the completion of the project. "Contractors working for the University are making repairs to certain portions of the floor," Lussenhop said. But Varallo said that the repairs that have been made are not satisfactory. "The workmanship is not up to standards," he said. "It's going to be a constant maintenance issue." Varallo added that contractors working for Penn's real estate company, Trammell Crow, did not show up yesterday. "We're looking to get the store open," Varallo said. "They should be here every day." The opening delay has forced Freshgrocer employees to remove perishable items from the store's shelves. Deliveries of products, intended for the supermarket's opening, have also been canceled. The Freshgrocer -- initially called Freshgrocer.com -- pushed back its original opening date to January 10 as construction delays surfaced. When January passed, the store was then set to open March 1. On February 28, The Freshgrocer hosted a reception for Penn and city officials. At the time of the reception, however, Freshgrocer officials had abruptly canceled the March 1 opening, eventually settling on the April 1 date. "What is going on here is hurting our name," Varallo said. "Our vendors are mad." Numerous area residents have had to put their plans for employment at Freshgrocer on hold, as well. According to Varallo, 48 new applications were received over a three-hour time period on Monday. Yesterday, almost 80 people applied for positions at the supermarket. Close to 60 people are also in possession of time cards waiting to be used. "We're losing so much money here, it's unreal," Varallo said.