St James Bross Deli shuts up shop

The landmark Bross Bagels shop at the prestigious St James Quarter has ceased trading and is now closed, The Edinburgh Reporter can reveal.

The high profile unit continued to operate under the Bross Bagels banner despite the troubled company being placed into liquidation by owner Larah Bross on 3 August with debts of £1 million.

Ms Bross had transferred the physical and IP assets of the business to her new start-up company Hot Mama Bagels Ltd just days before liquidators were appointed to wind up Bross Bagels.

The asset sale – for just £18,000 – is being investigated by interim liquidators Interpath and will feature in their report to creditors who have been left out of pocket and are unlikely to recover any dividend from realisation of the remaining assets.

A note placed on the window of the Little King Street shop today said: “Thank you to all our customers. We are sadly closing this shop. You can still find us in Portobello and Bruntsfield.”

The St James Quarter shop, known as the Bross Deli, opened in a blaze of publicity in early 2022 and Larah Bross said at the time: “the diner and deli experience is something that I grew up with and the new Bross store will bring a piece of that to Edinburgh in something that has never been seen before here.”

A number of comedians, television actors, Fringe performers and most notably Hollywood A lister Alan Cumming, have visited the St James Quarter shop to promote and endorse the products.

With other units in Portobello, Bruntsfield and Stockbridge, the opening of the city centre deli appeared to be a significant factor in the collapse of the company as noted in the liquidators’ interim report which stated: “The Company had committed to a new outlet in St James Quarter, Edinburgh which opened in late 2021. Despite the landlord contributing towards the fit-out of the unit, the Company’s costs to set up and operate this unit were significant and these added to the existing cash flow pressures.”

Amidst widespread anger from former customers, ex staff and suppliers, to all intents and purposes Larah Bross continued to trade as Bross Bagels following the business being placed in liquidation – using the defunct company’s outlets, website, branding and social media accounts to promote the new business.

It appears the outlets currently trading is being run by business turnaround specialists, Bar Restaurant Solutions, while Larah Bross is said to be focusing on “brand and marketing”.

The liquidators’ interim report – based on unaudited figures – revealed that creditors of Bross Bagels Ltd are due £970,000, with the largest HM Revenue & Customs, which is due as estimated £635,000, while Virgin Money is out £134,000 from a combination of an overdraft, Enterprise Finance Guarantee Loan and a Covid-19 Bounceback loan.

Almost £280,000 is due to unsecured non-preferential creditors, which includes a sum of £103,000 due to suppliers and small businesses, ranging from catering and cleaning firms to a barber shop and a window cleaner.

The liquidators are also attempting to claw back more than £60,000 due to the business by Larah Bross and her co-director Marc Millar, which were classified as “directors loans”.

Individuals who invested £1,000 each in to two crowdfunding rounds to raise £144,000 in a so-called “Shareholer” scheme are listed in the interim report – but as “unsecured obligations of the Company” are highly unlikely to receive any payout.

A spokesman for Hot Mama Bagels said: “In conjunction with the new management company, a decision was taken to close our site at St James Quarter. This decision was taken to help safeguard the jobs of all our staff.

“The Stockbridge site remains our outlet and will be reopening soon. It goes without saying that losing our St James site is regrettable and we are sorry to all the loyal customers who used it regularly.

“However, we feel it’s the best decision going forward and we will continue to serve our customers in our community outlets in Bruntsfield, Stockbridge and Portobello.”

The St James Quarter unit landlords Nuveen were estimated to be due at least £50,000 in unpaid rent by Bross Bagels in early August. The Edinburgh Reporter has repeatedly asked Nuveen to comment on the activities of Bross Bagels and Hot Mama Bagels at 4 Little King Street post-liquidation but they have refused to do so.

*Have you worked with Bross Bagels or been a supplier and have a story to tell? Get in touch: editor@theedinburghreporter.co.uk