Related California has officially been released from their obligation to provide a grocery store on the ground floor of their development at 450 Folsom St.

Promised grocery store for Transbay area residents falls through

A developer of hundreds of housing units in the Transbay area has formally dropped plans to bring in a promised grocery store.

Related California officials said they tried to meet a requirement to find a grocery store to lease approximately 13,000 square feet of commercial space at 450 Folsom St., which was included in their development agreement, but failed.

In a 3-2 vote Tuesday, the Commission on Community Investment and Infrastructure released the developer of the grocery store obligation. The developer was required to make a “good faith” effort.

The vote came days after the Transbay Citizens Advisory Committee split 4-4 on whether to recommend releasing the developer of its grocery store obligation.

“We’ve done the best we could,” said Bill Witte, chief executive officer of Related California.

Commission chair Marily Mondejar and Commissioner Mara Rosales opposed the removal of the commitment. Both said the developer could do more to make it a reality.

Rosales recalled that she supported project because it included a grocery store. “We are creating a neighborhood. We have to have neighborhood-serving uses and offerings,” she said.

The commission previously postponed a vote on the obligation in December, directing the developer to try for another 90 days. They conducted more outreach to grocers but to no avail.

Commissioner Dr. Carolyn Ransom-Scott said the developer had done its best. “I am impressed with how you tried,” she said. Scott supported the release of the obligation along with Miguel Bustos and Darshan Singh.

Witte explained that when they first designed the space Whole Foods was interested in being a tenant, but later dropped out. Since then, they haven’t had any takers. Some objected to the size or lack of parking, or the split-level design.

Rosales wondered if they could hold the developer responsible for a “dumb” design that no other grocer wants.

Witte said that the design seemed plausible at the time. “We didn’t go into this thinking this is never going to work,” he said.

A nearby grocery also opened in the intervening time, Woodlands, but residents say it is too expensive.

Related California will now look to lease the space to someone in the food and beverage industry.

Katina Johnson, a member of the citizens committee, suggested the space was likely Transbay’s last chance for a grocery.

“I’m frustrated,” Johnson said. “North Beach doesn’t even have a functional grocery store. I think we are headed in the same direction.”

She continued, “The neighborhood wants and expects to have an affordable grocer.”

jsabatini@sfexaminer.com

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