AppleTree Markets

AppleTree Markets was the last locally-owned supermarket chain in the Brazos Valley area.

Company History
Safeway, based out of California, put its 18-year-old Houston division up for sale in 1988 in an effort to raise money to pay off debts from a $4 billion leveraged buyout in 1986. On June 14, 1988, Safeway agreed to sell its Houston division to Texas Supermarkets Inc., a holding company formed by local investors Duncan Cook & Co. and the Sterling Group. The deal included 50 stores in Houston, 20 in Austin, stores in 23 other communities in East and Central Texas, along with a distribution center, frozen food warehouse, bread manufacturing plant and milk processing plant. At the time of the $174 million transaction, Safeway's 18 percent market share ranked third in the Houston market behind Kroger, with 27 percent, and Randall's Food Markets, with 21 percent. M. Dean Gantt, the former Houston division manager, assumed the position of president and chief executive officer of Texas Supermarkets Inc., which initially owned only eight of the stores from the transaction and leased the rest from Safeway. Texas Supermarkets was allowed to operate under the Safeway banner until June 28, 1989, but it would continue to do so until a new name began appearing in July 1989—AppleTree Markets. Five stores were renamed Budget Stores, stores with slightly lower prices on some items and fewer speciality shops such as delis, bakeries, and floral shops. The last of the Safeway banners was replaced in September 1989.

Gantt retired abruptly in October 1989 and was replaced a month later by Arthur L. Patch, senior vice president of Dublin, California-based Lucky Stores Inc.

Bankruptcy
The company struggled with the debt that originated from the 1988 leveraged buyout out Safeway's stores. After failed attempts to restructure that debt,  AppleTree sought Chapter 11 bankruptcy protection in 1992. Soon after the filing, AppleTree announced its plans to begin closing stores. Arthur Patch resigned his post in March 1992, and the chairman of the company's board, Fred R. Lummis, took the helm. Also a growing problem was the chain's aging store base. The bulk of Safeway units in Houston dated from the late 1960s and early 1970s, and a logo change in 1981-1982 was the only alteration, if any, to most of such stores before the AppleTree split. Many former Weingarten's stores, which had been acquired by Safeway in 1983, were even older. A very small minority of Houston Safeways were built in 1986, but these were larger and had a more modern, conventional prototype.

To cut costs and raise cash, AppleTree continued to close stores or sell its stores to competitors such as Fiesta Mart, Gerland's Food Fair, and Market Basket. The company would also look to move its headquarters to a smaller facility, as well as close its distribution warehouse.

In its reorganization plan, AppleTree announced plans to close or sell 33 additional stores.

Post-bankruptcy
As a result of the reduction of stores, AppleTree's northwest Houston grocery distribution facility, which included a 119000 sqft refrigerated warehouse, a large bakery and a major milk plant, was larger than AppleTree's needs. The facility was still owned by Safeway, and it was sold to H-E-B. As a result, AppleTree would buy its dairy products from a supplier and also relocated its headquarters to a building in northwest Houston.

AppleTree announced in November 1993 it would sell its remaining 49 stores to competitors. Eleven stores were sold to Kroger, five stores to Gerland's, four to Fiesta Mart, three stores to Rice Food Markets, 15 to Randall's Food Markets (including 12 Central Texas locations, of which three were closed), and one store each to H-E-B, Cox's Foodarama, Big Chief Super Markets, Stanley Stores, Super Warehouse Foods, and Sellers Bros.. Ironically, some of the former Safeway stores Randall's purchased from AppleTree became part of Safeway once again when Safeway bought Randall's in 1999.

AppleTree chief executive Tony Kubicek purchased the last six AppleTree stores and planned to operate the stores as an independent, Houston-based chain bearing the AppleTree name. Three of the stores were in Bryan-College Station, two in Houston, and one in Huntsville.

AppleTree closed its last Houston location in 1997. With the closing, AppleTree operated three stores in Bryan-College Station, where it would eventually relocate its corporate staff and also where chief executive Tony Kubicek 35 years earlier sacked groceries at a Safeway store when he was a student at Texas A&M University.

AppleTree further retrenched to its two Bryan locations after closing its College Station store.

=Stores== AppleTree Markets/Safeway had three stores in Bryan-College Station.

One was at the corner of Harvey Road (TX-30 and Texas Avenue (BS-6), at Culpepper Plaza. It replaced a store down further on Harvey Road (which had opened as a Weingarten's) and was closed in 2002. It was eventually demolished as part of a redevelopment and opened as in-line space. Today, there is a Spec's store on half of the former AppleTree footprint.

One was at the corner of East 29th Street and Villa Maria Road East. It had replaced a Safeway store (located catty-corner to the current location) and converted to Village Foods in 2009 after it was bought by the owner of the nearby Galleria Village. The original location is now a church and Brazos Bingo.

The store on TX-21 in Bryan closed in late 2009 or early 2010. It is now Super Canasta.