The City of Cleveland says it will search for a new grocer to replace the current operator of the Eastside Market, after ending an agreement with the nonprofit that had leased the space for six years.
The grocery store, located near East 105th Street and St. Clair Avenue, could close as soon as April 1. The city says Northeast Ohio Neighborhood Health Services (NEON), which rented the space for $1 a year, has not kept up with utility bills or property taxes. Health centers operated by NEON also face foreclosure, following a lawsuit from a lender over failure to pay off a loan.
The Eastside Market had been shuttered for a dozen years when the city decided to revive it over a decade ago in hopes of improving access to food for residents on the city’s East Side. It put hundreds of thousands of dollars into the Glenville building, and, in 2017, City Council voted to spend a $750,000 grant from the state and $187,000 from the city’s General Fund to help repair the market’s parking lot and roof and to make other improvements.
The New East Side Market opened in 2019, run by a for-profit company brought in by NEON’s CEO, Willie Austin. At the time he said it was an extension of NEON’s health mission and would help fight obesity and other chronic health issues.
But the market soon became embroiled in controversy. The market’s real estate developer, Arthur Fayne, was convicted in 2023 of embezzling money from the project. In his role, he received money from NEON to pay vendors such as general contractors and audio-visual companies. Instead of paying them, he pocketed about $885,000, according to the U.S. Department of Justice.
Signal Cleveland called and emailed Austin for comment but did not receive a response.
Sarah Johnson, a spokesperson for the City of Cleveland, said NEON owes about $50,000 in utilities. It also was behind on property taxes. County records show about $194,000 are currently owed. That was a violation of lease with the city, Johnson wrote in an email. Even though the city owns the building, the company was supposed to pay property taxes because it is for-profit, said Council Member Kevin Conwell.
The city hopes to identify “a new partner to continue serving the residents in this area” through an application process, Johnson said.
“Ideally, this would be a grocer [or] some sort of food service operator,” she added.
‘It’s gonna hurt a lot of people’
Leaders of NEON and the New East Side Market are painting its imminent closure as a crisis for its employees and the surrounding neighborhood. About a dozen people – mainly employees but some customers – visited Cleveland’s City Council meeting to protest the decision Monday night.
“Everybody loses – the whole community,” said Charles Lytle, a board member of NEON, who attended Monday’s council meeting. “…It’s gonna hurt a lot of people.”
The employees did not speak to the City Council during public comment because of rules requiring sign-ups ahead of time. But in conversations with Signal Cleveland, they said it’s unclear what will happen to employees and existing food inside the market when the lease is up. Signal Cleveland visited the store Monday afternoon and found shelves stocked with fresh produce and other pantry staples. On Tuesday, the store was still open. Lytle told a reporter he asked the city whether the store could keep operating until it found a new grocer but has not heard back.
“That store employs people from the neighborhood. People need jobs,” said Tammy Jones, who shops at the store, used to work there and is concerned about its closure. She said the store has high-quality food items, ones that aren’t available at other stores where she might now have to shop.
Others complained that prices are too high at New East Side Market. Tameka Woodland, who was visiting the store Monday, said it’s typically her “last resort” because prices are high and the selection is low.
