At auction, Delta Sonic bids record price for liquor license for upper Peach Street store

Update: The Summit Township supervisors on Nov. 6 approved the transfer of the liquor licenses that is the subject of this story.

The Delta Sonic car wash complex on upper Peach Street in Summit Township is poised to be the latest gas station and convenience store in Erie County to get a liquor license to sell beer and wine.

The liquor license that Delta Sonic is in the process of acquiring, however, is different than most other liquor licenses in one major respect.

It drew the highest bid for a liquor license in Erie County at a public auction since the state started holding the events in 2016 to sell expired restaurant liquor licenses.

The winning bid for the Delta Sonic license was $130,100, according to the Pennsylvania Liquor Control Board, which runs the auctions. That is $50,000 more than the next-highest bid offered at auction for a liquor license in Erie County since 2016.

Still a mystery is whether the $130,100 represents the most ever paid for a liquor license in Erie County.

Most liquor licenses change hands in private transactions. Those sale prices stay secret.

No confidentiality is attached to the winning bids submitted at the PLCB auctions. The PLCB posts the results online.

Other than court actions in which the value of a liquor license is disclosed, the auctions provide the public some of the only insight into what the market will bear for a liquor license in Erie County and any other county in Pennsylvania.

The auctions can "provide a sense of how much a retail liquor license is worth in a particular county at a particular time," PLCB spokesman Shawn Kelly said.

In the case of the Delta Sonic, at 6900 Peach St. in Summit, the winning bid of $130,100 was higher than the typical value of a liquor license in Erie County for a reason, said the broker who handled the deal for Delta Sonic. He said the Delta Sonic chain, based in the Buffalo area, plans to remodel the Peach Street store to sell alcohol.

"They did submit a higher amount than the current market value because the inventory (of available liquor licenses) is scarce and they needed to start on the project," said Sidney Sokoloff, president of the Pittsburgh-based Specialty Group, which brokers the sale and purchases of liquor licenses as well as restaurants and bars. "So, they were willing to spend to secure the license."

Through an entity called Specialty Lenders LLC, the Specialty Group submitted the winning bid of $130,100 for the expired liquor license at the most recent PLCB auction, in September. It was the PLCB's 12th auction since the General Assembly authorized them in Act 39 of 2016.

Summit Township supervisors to vote on transfer of license

The deadline for submitting bids was Sept. 25, and the PLCB announced the results Sept. 27. Sokoloff told the Erie Times-News that his company submitted the bid on behalf of Delta Sonic.

The Delta Sonic at 6900 Peach St., north of the interchange with Interstate 90, is in the process of taking possession of the expired liquor license. It had been attached to an unidentified business in Harborcreek Township, according to PLCB records.

Following PLCB regulations, the Summit Township supervisors on Monday night are scheduled to hold a public hearing on whether to approve the transfer of the license from Harborcreek to Summit, and specifically to the Delta Sonic on Peach Street, according to a legal advertisement in the Erie Times-News. Such transfer requests are typically granted.

Sokoloff said his company plans to transfer the winning bid to Delta Sonic once the inter-municipality transfer gets approved. As the auction winner, Delta Sonic would then have to apply for the license with the PLCB. Convenience store applicants also typically apply for an expanded license to sell wine as well as beer, the PLCB's Kelly said.

He said the PLCB has no timeline for how long the license approval process takes.

"Each application is different," Kelly said.

Bid is high for Erie County, but not for Philly area

Kelly said the PLCB could not provide information on the Harborcreek business that owned the liquor license before it expired. "The expired licenses being auctioned are no longer owned as these licenses were non-renewed, revoked by an administrative law judge or are no longer eligible for safekeeping," according to the PLCB. The PLCB puts inactive licenses in safekeeping.

The number of licenses and their locations vary from auction to auction. In the September auction, the license that drew the $130,100 bid was the only license available in Erie County of the 20 licenses on the list. Fifteen of the 20 licenses received bids, the PLCB said. It said the average top bid in the auction was $141,145.

And though the $130,100 bid set an auction record for Erie County, it was far from the highest bid overall on the September list. A liquor license in Walnutport, Northampton County, north of Allentown, garnered the highest bid, at $400,000. The bidder was the food services giant Aramark Sports and Entertainment Services.

The next-highest bid was $350,100 for a license in Norristown, Montgomery County, near Philadelphia, with a group called Suburban Investment Corp. as the top bidder. Another top bid was $300,000 for a license in Chester, Delaware County, also near Philadelphia. The top bidder for that license was the Wawa convenience store chain.

Liquor licenses in an around Philadelphia typically draw the highest bids at the PLCB auctions. The lowest winning bid in the September auction was for $30,001. It was for a liquor license in Wilkes-Barre, Luzerne County.

The minimum bids for the PLCB auctions start at $25,000. The bids are submitted under seal — a setup known as a blind auction — and bidders do not know the dollar amount of the competing bids in real time.

Funds collected through the auctions go directly to the PLCB's State Stores Fund, the board said. The fund helps pay for the operating costs of the PLCB, inventory purchasing, state police enforcement, and it provides revenue to the Department of Health for drug and alcohol programs, according to the state House Appropriations Committee.

The new owners of the licenses can seek to transfer them to other municipalities with the county, just as Delta Sonic is seeking to do. Licenses generally cannot be transferred between counties. Inter-municipal transfers are based on a quota system.

What are other prices for liquor licenses in Erie County?

Before the $130,100 bid was submitted for the Erie County license in September, the highest bid at auction for a liquor license in Erie County was $80,010, in September 2019. Walmart was the top bidder, according to PLCB records.

Other liquor licenses in Erie County sold at auction since 2016 have drawn high bids of around $70,000, more or less, according to PLCB records. That matches the price of an Erie County liquor license that sold in a private transaction that became public in a lawsuit in 2022.

In that case, the Country Fair convenience store chain initially agreed to buy the liquor license of the former Lager Cafe, at 2056 W. Eighth St. in the city of Erie, for $70,000. The final sale price went up following the court fight, but the final amount was not disclosed.

License in court: Country Fair, Erie's Lager Cafe settle suit over sale of bar's liquor license. Here's the deal

As for the Delta Sonic license, the price might have been high, but the deal was worth it, said Sokoloff, the broker. He said a license was available and Delta Sonic needed one to sell alcohol at 6900 Peach St.

"They are hoping to get everything done as soon as possible," he said.

Contact Ed Palattella at epalattella@timesnews.com. Follow him on X @ETNpalattella.

This article originally appeared on Erie Times-News: Delta Sonic wins liquor license at a record price for Erie County