Fairway Market, considered by many the quintessential New York City supermarket, filed for bankruptcy yesterday, citing competition from "natural, organic and prepared food rivals" and "online ordering and home delivery services," according to the Wall Street Journal. Perhaps their biggest threats are Whole Foods and Trader Joe's, which both seem to be in a very different boat. Yahoo! Finance looked at data of four million homes in the U.S. that are located in a zip code with either one of these stores, "finding that average property values in a ZIP code with Trader Joe's appreciated by about 40 percent since they were purchased, while homes with a Whole Foods in the ZIP code appreciated by nearly 34 percent." The reasoning is quite simple -- people will pay a premium for the convenience of being near their favorite stores. And proximity to a store like Whole Foods, often thought of as more high-end than other grocery stores, adds an air of prestige to a neighborhood. But the science behind it is a bit of a chicken or the egg situation -- does a retailer directly affect home values, or are these companies able to identify locations where they'll generate the most interest?
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