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Niche markets replace groceries

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Although Cala and Alberstons food stores have closed down recently in San Francisco, there is a new crop of grocers moving in.

As five neighborhood stores shut their doors in the past year, residents in the communities of these stores and their city representatives were nervous that they would lose a vital resource. While one of the sites was transformed into an auto dealership and two others remain dormant, Whole Foods is possibly moving into a former Alberstons on Clement Street and has plans for the former Cala Foods site in the Upper Haight neighborhood.

The fear generated by the closures had some wondering if San Francisco was on the verge of experiencing a mass exodus of these chain grocery stores.

“I don’t think we can generally say grocery stores are leaving The City,” said Rich Hillis, deputy director for the Mayor’s Office of Economic and Workforce Development. “There are numerous types of markets coming to The City such as Trader Joe’s, Whole Foods and Market Manila. There’s a correction within the grocery market. The older-type stores are no longer as useful.”

Eight grocery stores opened in San Francisco in the last three years, including two Whole Foods and a Trader Joe’s, and there are seven sites under discussion for new grocery stores in The City’s underserved neighborhoods, including the Tenderloin and Western Addition.

A trend emerging in The City that may lead tomore grocery stores is mixed-use housing proposals that include grocery stores. A housing development with a grocery store is taking shape for the Kragen Auto site in the Oceanview-Merced-Ingleside community.

“In the past there have been housing proposals out there that have just been killed and have had no shot,” Supervisor Sean Elsbernd said.

Now that the community is hearing a Trader Joe’s is interested in the location, the “neighborhood is getting very excited,” he said.

Including a grocery store as part of a development “will make some of those policymakers a lot more amendable to some higher density housing that in and of itself wouldn’t be acceptable,” Elsbernd added.

The City has not made it easy for these large grocery store chains to do business in San Francisco, according to Elsbernd, whose district saw the recent closure of Alberstons on Alemany Boulevard.

City voters created an “unnecessary hurdle” for grocery chains in November 2006 by passing Proposition G, which enacted a city law requiring all large chain stores to undergo a cumbersome and lengthy conditional use permitting process before being allowed to open up for business, according to Elsbernd.

Elsbernd wanted to pass legislation that would have exempted grocery store chains from the conditional use requirement, but abandoned the plan when told he would have to return to the ballot with the proposal.

He was, however, able to pass legislation that makes it more difficult for a supermarket to change use, by requiring a conditional use permit for any different use.

Recent grocery store closures:

» Albertsons at 3995 Alemany Blvd.

Remains closed and for lease

» Albertsons at 3132 Clement St.

New grocery operator, possibly Whole Foods

» Bell Market at Franklin and Post streets

Up for lease

» Cala Foods at Haight and Stanyan streets

New grocery operator scheduled, possibly Whole Foods

» Cala Foods at Fifth Avenue and Geary Boulevard

Turned into Toyota Car Dealership

-Source: Mayor’s Office of Economic and Workforce Development


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