Swedish-inspired cafe and bakery Fika — once considered one of the fastest growing retailers in the city — filed for Chapter 11 bankruptcy protection on Friday, the Post reports, spelling trouble for a chain that once operated as many as 20 New York stores.
Court documents show the Manhattan-based coffee shop, whose Swedish name translates to taking a coffee break, owes a substantial amount of leasing fees for 11 of its locations. The largest sum, nearly $277,000, is owed to Related for a store at 157 Seventh Ave., according to filings in the Southern District of New York. The store is one of seven still listed on the company’s website.
The coffee chain also owes $72,844 in commercial real estate taxes, as well as tens of thousands of dollars in unpaid credit card debt, utility fees, and legal services, according to court documents.
“We are in no way shutting down operations,” spokeswoman Lena Khoury tells Eater, adding that the company is using the Chapter 11 filing to restructure and keep the business running. “FIKA remains open as usual.”
Known for both its coffee and chocolate, Fika had successfully expanded its NYC footprint since its 2006 inception. But several of its locations began shuttering over the past year, according to the Post. A Fika spokeswoman downplayed the closures at the time, saying the company was shifting resources to focus on its wholesale business.
In 2016, the coffee store was considered one of the fastest growing chains in the city. Founder Lars Akerlund had plans to expand not just in the U.S. but globally as well, following a strategy similar to Apple, where each city would be home to a flagship location in additional to smaller satellite stores. “My ultimate vision for Fika has always been to build a global brand,” he said then.
The cafe was then riding a positive wave of growth: Between 2014 and 2015, Fika reportedly opened at least eight shops in a 10-month time period, which made it one of the fastest growing players in New York’s retail scene.
It’s yet another ambitious chain that’s faced major bumps following rapid expansion in New York. Australian pie shop Pie Face met a similar demise in 2014; following a period of robust growth, the chain closed most of its bakeries and cafes across town. And last year, Crumbs Bake Shop also shuttered dozens of its stores — for the second time.