Compass Coffee has filed for Chapter 11 bankruptcy protection as it restructures parts of its business to address lower foot traffic and rising costs in Washington, DC.

The company said its cafés will remain open and operating throughout the process, and it will continue serving customers across the city.

Compass cited structural changes to Washington’s retail environment since 2020, including sustained declines in downtown office occupancy and weekday foot traffic. The company said legacy lease structures and fixed operating costs are no longer aligned with current consumer demand.

As part of the restructuring, Compass will close its Ivy City roasting facility. The company said the site was built to support a scale of production that no longer matches today’s retail environment and that operating a large manufacturing facility within the city is no longer economically viable.

Compass said the Chapter 11 process will allow it to address legacy costs, rebalance operations around current demand and concentrate resources on its strongest neighbourhood cafés.

Michael Haft, founder and CEO of Compass Coffee, said: “As a fourth-generation Washingtonian, I started Compass to build something meaningful for this city and the people who show up for it every day. This has been a difficult chapter, and the decisions we’re making reflect the reality of this moment in Washington. They allow us to keep serving the city with the same real good coffee and sense of community that have defined Compass from the beginning.”

Founded more than a decade ago, Compass operates 25 cafés across the Washington, DC, Maryland and Virginia area. The company said it will continue trading during the restructuring while it works to stabilise the business and align its operating structure with current market conditions.