Transbay Block 8 Rendering: Folsom and First

It’s now been over two years since Related California cut 99 residential units from their development plans for Transbay Block 8 and reduced the project’s proposed grocery store space from 22,000 to 12,500 square feet, a reduction that rendered the space too small for a large grocer like Whole Foods or Trader Joe’s.

While the approved development agreement for the 548-unit building to rise up 55 stories in height upon the City’s former Transbay Block 8 requires Related to use “good faith efforts” to obtain a grocery tenant “on commercially reasonable terms,” with a full-service grocery having been deemed “very important” to the development of the Transbay District and its future residents by the City’s Office of Community Investment and Infrastructure, Related could seek approval from the City “to reprogram the space for another use” if a lease hasn’t been inked at least 12 months prior to the anticipated completion date of grocery store space which is currently slated for August 2019.

And according to Related’s latest update to the City, neither Bi‐Rite nor Gus’s Community Market have expressed interest in the future space along Folsom between Fremont and First nor has another operator.

Recent Articles

Comments from “Plugged-In” Readers

  1. Posted by Notcom

    “…like Whole Foods or Trader Joe’s” or any other grocer above the level of 7-Eleven or a dollar store (although, to be honest, it sound’s like its borderline for TJ’s, whose stores are almost boutiquish by nature).
    But I’ll hold my tears in check for now: if it’s a food desert, it’s a money oasis…I’m sure the residents will find some alternative to starving ( even if it means dining at “Saison” every night).

    • Posted by Notcom

      Let me clarify 12,500 gsf is EXACTLY in the range of current TJ’s, tho it appears they are trending toward slightly larger stores.

      • Posted by archiwha?

        typically when you see retailers post store sizes, they are referring to commerce area only, i.e. where customers are allowed to go. a commercial sized grocer, like TJ’s, would require about 20-30% of the commerce area for back-of-house (receiving, storage, office, etc.) — meaning this location would “shrink” to a figure of about 9,000 SF.

        TJ’s has a high “commerce-to-gross ratio” because they don’t have butchers, bakeries, etc. which eat up a lot of floor area. but still, the ratio would settle out to 0.75 or so, meaning this location may be too small for even TJ’s.

        • Posted by Notcom

          I believe the figures in the link are for the gross floor area, not the “sales area”, tho I’m not 100% sure, so you may be correct; and, of course, as I noted, while it may – or may not – be of their current size, it is def smaller than the 15K mentioned in the article. But it’s only a little smaller, so cynics are well to speculate that the space was reduced to that level precisely for the reason of exclusion…for what purpose, I’m not sure.

      • Posted by Alai

        The Trader Joe’s on Masonic, measured in Google maps, is 120×130, or 15,600 square feet.

    • Posted by yves

      contrary to popular belief, there are people in my neighborhood that aren’t billionaires, ie those of us that don’t live in giant glass houses… we could definitely use an alternative to whole foods, woodlands, weekday-only and fine dining establishments.

      • Posted by Harambe

        Yeah, good luck finding a tenant that’s not fine dining quality to pay fine dining rent. The devs shot themselves in the foot.

  2. Posted by Adam

    Perhaps the city should not have allowed the size reduction for this space, if they were really serious about getting a market to move in to it.

  3. Posted by fogmachine

    Perhaps the Woodlands Market (which is an oversized corner grocery) at Main and Folsom has something to do with it. Would love to see a Nugget grocer in this area.

    • Posted by another anon

      Woodlands is awesome. It’s not huge, but they have pretty much anything. It will definitely make some kind of dent in the business of the Whole Foods on 4th and Harrison.

  4. Posted by Martin

    Woodlands fits into about 9K sq-ft of space, so 12,500 makes this space about 35%… surely big enough for a TD.

  5. Posted by c_q

    well, with woodlands market just 1 block away now, maybe not as critical as before

    I also believe there is a plenty of space for a grocery store in the transbay terminal also a block away, if they can sign one up.

  6. Posted by BTinSF

    I thought not so long ago “city market” sized outlets were all the rage and most full-size grocery chains and big box retailers were trying out he concept–even Whole Foods. Have they all abandoned it?

    • Posted by Amewsed

      Those city market type stores often are very limited in merchandise and prices are higher than the regular sized stores. Not sure how the city market stores can compete with online grocery stores in terms of price, selection, and convenience, given the high retail rents.

  7. Posted by Amewsed

    How about an Aldi or a Carrefour supermarket? Why place a limit on struggling U.S. brands? Go international given our city’s diversity.

    • Posted by Notcom

      I don’t think Carrefour operates in the U.S.; OTOH, Aldi is freely expanding and operates in similarly sized footprints…whether the demos fit is another question.

      • Posted by Brian M

        Gawd. The Aldi store brands are just awful. Still remember living on Aldi canned goods during university days.

        Might as well bring in a Grocery Outlet.

    • Posted by Memester

      Carrefour has zero logistics in the US. It’s not going to take on a single city site. Aldi doesn’t like high priced real estate, it doesn’t work with it’s profit margins. Delhaize operates in the Eastern US, but has no west coast supply chain.

    • Posted by Freeloader

      FWIW, Trader Joe’s is owned by Aldi.

  8. Posted by anon2.5

    I suspect the lack of full-time residents in the area plus the Safeway near Caltrain is deterring grocers from jumping on it.

    • Posted by Dr. House

      And also, Safeway’s the only non-Whole-Foods grocery store that even plays in the City. Lucky has two locations, Kroger has two (Foods Co), Safeway has at least 18. Whole Foods has 7. It seems apparent that nobody else feels they can compete with the two entrenched players. Whole Foods (plus the boutiquey locally-owned neighborhood places like Gus’s) have got the richest demographic completely locked down already, and the poor have only the terrible Safeways – but are not that attractive a demo for Safeway’s competitors to try to poach.

      The city should plot on a map every part of the city that isn’t already within 3/4 mile of TWO real supermarkets and offer a big payroll tax break and possibly other incentives to anyone opening a supermarket in one of those zones. Having only one store close by means zero competition which is why Safeways in SF are dirty and have worse-than-average service (compared to their stores elsewhere). And it’s also why Whole Foods can get away with making people wait in line for a half hour at peak times. “What are you going to do, go to an even farther away Whole Foods, or go to Safeway?”

      • Posted by Notcom

        I was going to fault you for hyperbole, but you’re actually not far off: Safeway has 14 w/i SF, and another just over the line in DC…curiously there aren’t any of the Pak ‘n Save’s there, tho.

      • Posted by anon2.5

        Gus’s maybe a boutique but far from unaffordable. In fact, I generally find Gus’ to be better value for money than Safeway or Whole Foods. Haight Street Market is my regular grocer. I also recognize that haight st. market is cheaper than newer Gus’ which probably have higher leasing costs. Online delivery services now take care of like 90% of your needs. I am in my 30s and am married. I can’t remember the last time I bought any non-perishable maintenance item (toilet paper, bathroom supplies, cleaning supplies, etc.) at an actual store. I suspect most in my generation are like that. Those are the higher margin items for grocers, not fresh groceries.

        The way to attract grocers is require or incentivize affordable commercial spaces. I don’t think tax breaks will you get there. The new commercial spaces are just too shiny and still too expensive. A grocery store doesn’t really benefit from a block sized ground level store-front. In many other urban areas, you will find a small ground level storefront, with stairs going to a second level. I am thinking of the Target in the metreon as an example, which is normally packed.

        SOMA has a density problem. Lots of tall buildings without full-time residents (pied a terres) or a mix of residential and office. I also suspect there’s a bit of self-selection too. Those buildings probably attract people who don’t prioritize or value the neighborhood atmosphere and are less likely to walk out of their building to go buy groceries. Moreover, even with Haight St. Market just 2.5 blocks from my house, it’s a real chore to lug groceries back. With the longer blocks in SOMA, I just don’t think people are willing to walk all that far to get groceries. It also feels silly to pull your car out for a two block drive. Plus, if you’re doing that, then you might as well drive to Safeway a few blocks away. In other words, I think there’s a bright future for smaller corner shops, but the future is probably bleak for an additional full-size grocery store in that area.

        • Posted by Fishchum

          “I can’t remember the last time I bought any non-perishable maintenance item (toilet paper, bathroom supplies, cleaning supplies, etc.) at an actual store”

          – My wife and I are in the same boat. We order all our non-perishable items (pasta, soda, etc.) online from Safeway and have it delivered. For everything else we have Marina Super and Marina Meats right down the street on Chestnut.

      • Posted by Patrick

        You left out Mollie Stone, which has three stores in SF

    • Posted by Martin

      Let’s not forget that Walgreens managed to work their way around the formula retail limit by stocking a few apples on the side making them technically a “grocery” store. There’s 7 Walgreens on Market + Mission in FiDi!

  9. Posted by Pablito

    With all the delivery services coming online – I expect full service grocery stores in SF will go the way of book stores and taxi companies. Paying downtown SF retail rates to sell toilet paper, laundry detergent and cat litter us not a profitable venture.

    • Posted by sfcommie

      You mean, like, webvan? I wouldn’t hold my breath. I still like the idea of picking up a few produce items the way home for dinner and there are reasons why Amazon is moving into brick and motar business.

      • Posted by Pablito

        Yeah. Exactly like Webvan. An idea ahead of it’s time. Just because Webvan failed doesn’t mean the next company will. Remember Netscape? Yahoo? Bing? Google does the same thing they did only much better….

  10. Posted by inclinejj

    The owner of Gus’s Markets was killed by a hit and run driver in SF a couple weeks ago.

    RIP GUS!

  11. Posted by yves

    woodland market focuses too much on ready-made & hot foods. crossing my fingers for a small scale rainbow to move in. fresh fruits and greens pls.

    • Posted by Brahma (incensed renter)

      The phenomenon you’re describing, where a store focuses on ready-made & hot foods, is called a grocerant. Going to be simply unescapeable pretty in a few years.

    • Posted by RHlandlord

      It’s because hardly anybody that lives in Rincon Hill actually cooks for themselves these days! There’s definitely a demand for the ready-made items and they are smart to capitalize on that.

      FYI I spoke to an employee at Woodlands who informed me that they are able to special order pretty much anything. So convenient!

  12. Posted by Mari

    Well isn’t luxurious housing = buy your groceries online through Amazon or whoever?!!!

  13. Posted by Peter Pam

    Walgreens is closing 600 stores. Safeway/Albertsons merged and are consolidating. Safeway bought Andronicos. Amazon bought Whole Foods.

    Does anyone realize how expensive it is to build out a grocery store with refrigeration and freezers? Maybe the city should incentivize a tenant by contributing to the tenants build out. I can’t wait to raise my family on the 47th floor of my two bedroom apartment in soma

Add a Comment

Your email address will not be published. Required fields are marked *