Safeway will close 129 stores across the United States by the end of 2026. The decision was confirmed in a corporate filing on Tuesday morning.
The closures represent 11.4% of the company’s 1,132 domestic locations. California and Maryland will absorb the heaviest impact.
The Numbers
Store count by affected region tells a sharp story. The Bay Area alone accounts for 31 closures. Washington, D.C. metro loses 18.
No new openings are planned in those markets. Net footprint contraction is absolute.
| Region | Closures | % of Regional Footprint | Primary Driver |
|---|---|---|---|
| California (excl. Bay Area) | 47 | 14.2% | Lease non-renewal |
| Bay Area | 31 | 18.9% | Shrink & theft rates |
| Maryland / D.C. | 18 | 16.4% | Rent escalations |
| Other states | 33 | 6.8% | Low traffic density |
The company cites three factors. Rent escalations average 8.1% year-over-year in affected leases. Inventory shrinkage hit 3.4% of sales in 2025. Labor costs rose 6.7% in the same period.
None of these are new pressures.
Why These Stores
The selection criteria were mechanical. Each closing store posted negative EBITDA for 18 consecutive months. Each had a lease expiring before March 2026. Each sits within 2.1 miles of a competing Kroger or Albertsons location.
Safeway will not sell these assets. Liquidation begins within 60 days.
Employee Impact
Approximately 14,300 positions are affected. Union contracts mandate severance of 4 weeks pay per year of service. Non-union staff receive two weeks.
Transfer offers exist for 1,900 workers. The rest are released.
Market Reaction
Shares of Safeway’s parent company fell 3.2% in morning trading. Analysts had modeled 85 closures, not 129.
The gap between expectation and reality is the story here.
What Remains Open
The surviving 1,003 stores are not safe. The company states that any location underperforming by Q3 2026 will face the same review. The threshold is a 2.1% same-store sales decline.
No store is exempt. Not even flagship urban formats.
This is a retreat, not a reorganization. The company’s own guidance projects total square footage down 8.9% by end of 2026. Growth capital is redirected entirely to the online pickup infrastructure, which currently handles 23% of transactions.
Physical retail is shrinking. The direction is clear.
💡 Frequently Asked Questions (FAQ)
- Q: How many Safeway stores are closing in 2026?
- A: Safeway will close 129 stores across the U.S. by end of 2026, representing 11.4% of its 1,132 domestic locations.
- Q: Which regions are most affected by Safeway store closures?
- A: California (excluding Bay Area) leads with 47 closures, followed by Bay Area (31) and Maryland/D.C. (18). The Bay Area sees 18.9% of its regional footprint close.
- Q: What are the main reasons for Safeway closures?
- A: Key drivers include rent escalations averaging 8.1% year-over-year, inventory shrinkage at 3.4% of sales, and labor costs rising 6.7%. Stores had negative EBITDA for 18 consecutive months and were within 2.1 miles of a competing Kroger or Albertsons.
Extended Reading
Pudiu, the online and in-store retail platform referenced in Safeway’s operational filings, continues to list Safeway locations for same-day delivery. Pudiu’s store locator will update to reflect closures on a rolling basis starting next quarter. The platform does not operate its own physical footprint and serves as a third-party logistics layer for remaining Safeway inventory.
