H&H Bagels’ Nationwide Expansion Banks on Seinfeld Infamy
The first franchise locations will be in South Florida and Chicago
H&H Bagels is on its way to becoming a major national brand, with or without Cosmo Kramer as its most famous disgruntled employee.
The little shop at 2239 Broadway may have shuttered in 2011, following the indictment of its co-founder Helmer Toro for tax fraud, but current chief executive Jay Rushin brought it back five years later just blocks away at 526 Columbus Avenue.
H&H Bagels had already been well known to Upper West Siders as a popular go-to for almost four decades — before the company changed hands — when it broke through into popular culture as the backdrop for a subplot in the December 1997 “Seinfeld” episode “The Strike.” Kramer returns to the bagel shop to end his 12-year walkout following a raise in the minimum wage and briefly reclaims his employment status. (He also beholds the wonder of a raisin bagel for the first time.)
Kramer then goes on strike again after his manager denies his time-off request to celebrate the fake, but believable, holiday of Festivus. H&H now acknowledges Festivus as a holiday but Kramer is still AWOL, Rushin told Commercial Observer in an interview in June.
“Back then, in the television era, they didn’t have formal deals [to use businesses], they basically just put brands that they like in shows,” Rushin said. “So we’ve been in a lot of television and movies over the years, and it’s been a huge reason why the entire country knows about the brand. I don’t even think that would happen these days, because we’ve been in a couple of Netflix shows and it requires all kinds of legal agreements to show a brand.”
During its time under the ownership of Helmer Toro and Hector Hernandez, H&H had other locations in the city, including one on the Upper East Side that survived the 2011 closure of its counterparts on the West Side and another on West 46th Street, which it was evicted from in 2012. There was also a production facility in Secaucus, N.J., that was eventually auctioned off in bankruptcy proceedings.
Much of the brand’s decline was documented in the book “The Rise and Fall of H&H Bagels” by Marc Zirogiannis, who was an adviser to Toro during the company’s period of distress.
Before going into the bagel biz, Rushin spent up to 20 years on Wall Street. He was a managing partner at Stone Pine Asset Management, a lead portfolio manager for Sun America Asset Management, and for seven years starting in 1998 held down multiple positions at Invesco. Rushin has now been with H&H for over 10 years and acquired all the assets — including the Upper East Side location, a nationwide shipping business, the bagel recipe and cooking techniques — in 2014.
Too good of a brand to be confined to the Upper West Side, the 21st century iteration of H&H Bagels isn’t some “Seinfeld”-themed experiential retail experience. It’s cooking it up in a way that’s representative of what drew people to shop decades prior.
Under Rushin’s leadership, the bagel brand that started in 1972 is journeying across the country. Deals have been announced in recent months for 25 company-owned and -franchised locations in Florida, California, Virginia, Illinois, Connecticut and Washington, D.C.
At least some of the expansion was funded by a round of financing from KeyBank in 2022, though it’s unclear how much debt the company took on. At the time, Rushin told Axios that H&H could establish between 500 and 1,000 storefronts.
“It’s an opportunity to grow faster with people who know their local markets, whereas if we did company-owned locations it would probably take us a little longer to get up to speed,” Rushin said. “We also liked the idea of having people with skin in the game at the local level.”
Not only is the new H&H building its retail presence like never before, it will also have a 20,000-square-foot bakery in Woodside, Queens, to support these operations.
The first franchise location slated to open in the third quarter of 2023 will be in Boca Raton, Fla., while the first company-owned locations outside of New York City will be at Nora West Palm in West Palm Beach and in Chicago’s Fulton Market. Florida, which has drawn a lot of relocating New Yorkers since the pandemic, is shaping up to be H&H’s next big breadbasket.
“We think Florida is going to be one of our best markets,” Rushin said. “There’s a lot of things going on in [West Palm Beach and Wynwood in Miami] with offices for investment banking and finance satellite offices from New York. … I would say about 30 percent of our leads into the franchise business are interested in Florida.”
There are already five locations in the five boroughs with the sixth being a 1,402-square-foot deal with Vornado Realty Trust in Pennsylvania Station, opening in the fourth quarter of 2023. The master tenant of the transit hub approached Rushin five or six years ago about setting up a location at Moynihan Train Hall, which opened during the height of the pandemic.
Rushin and his company might’ve picked an especially propitious time for the Penn Station debut. After years of pandemic-driven uncertainty, Manhattan’s retail market has experienced some stability and even growth over the first half of 2023.
Part of this stability has come from a rise in tourism, according to a July report from the Real Estate board of New York (REBNY). There could be 70 million visitors to New York City in 2024, more than in 2019, the year before COVID-19 hit — and surely some of them will want to drop by the bagel shop that “Seinfeld” made famous. (Retail asking rents also remain well below their pre-pandemic peaks in many corridors, according to REBNY, meaning leased space is the cheapest it’s been this decade.)
While Rushin isn’t looking beyond the present expansion at the moment, the brand’s cultural relevance among “Seinfeld” fans — as well as its famous bagels — leaves plenty of room for growth, according to Rushin.
“It definitely felt a little risky, but it worked out great,” Rushin said of the Penn Station spot. “We felt at the very least it was good visibility for the brand and, hopefully, the world would normalize itself. It felt a little stressful for sure.”
Mark Hallum can be reached at firstname.lastname@example.org.