Long Beach, CA – October 2019, Centers Business Management (CBM) completed a leasing transaction with discount supermarket, Grocery Outlet in a large-scale strip center on Wardlow Road in prime Long Beach
CBM Valley Division Director, Dave O’Connell, and CBM retail specialist, Zac Ryburn, recently completed a lease transaction, representing the landlord in a deal with Grocery Outlet, a discount-focused supermarket chain positioning itself as a “bargain market”. Grocery Outlet operates 300+ stores across the United States and is currently expanding in Southern California. Grocery Outlet will occupy an 18,000 SQFT portion of a former TJ Maxx store in a sprawling, remodeled retail shopping center well-positioned at the busy intersection of Wardlow Road and Norwalk Boulevard. The El Dorado Center is ideally located to serve the family-centric neighborhoods of El Dorado and neighboring Los Alamitos. The busy, well-patronized center hosts national tenants Dollar Tree and Goodwill, in addition to a successful and diverse mix of service-oriented tenants including fitness, optometry, dental, and pet services that underscore the daily needs of the surrounding populous, which generates a consistent stream of consumer traffic.
Founded in 1946 in San Francisco, Grocery Outlet currently operates 320 locations in California, Oregon, Washington, Idaho, Nevada, and Pennsylvania. Largely a California-based enterprise until the founder’s sons took charge and aimed to expand the business in the early 1980s. The chained reached the 100-store milestone in 1995 and has added 120 locations in the ensuing two and half decades. Though primarily focused on the western United States, Grocery Outlet purchased an independent grocery chain in Pennsylvania in 2011. An acquisition that points toward the company’s plans for broader expansion.
“Leasing a 24,000 SQFT space (formerly occupied by TJ Maxx) is no easy task,” confesses CBM leasing agent, Zac Ryburn, adding “24,000 SQFT spaces have become a bit of an in-between size with a larger segment of active tenants seeking spaces of either 15,000 SQFT or closer to 35,000 SQFT.” Grocery Outlet “responded with interest in the space,” Ryburn notes, “but their store footprint typically focuses closer to the 16,000 SQFT mark.” The location proved appealing enough that Grocery Outlet agreed to compromise and take 18,000 SQFT. In turn, the landlord consented to carve up the remaining space creating two additional 1,500 SQFT units and rear storage area. “Other than Dollar Tree, Goodwill, and Huff’s (the restaurant tenant on the pad), the (center’s) tenants are mostly smaller, service-based businesses,” says Ryburn, who’s confident the remaining units will be readily absorbed by other service providers.
“Repurposing and downsizing is often a landlord’s only option with Big Box spaces,” says CBM Valley Division Director, Dave O’Connell. “But demising a space specifically designed to accommodate an expansive footprint can be a costly undertaking” O’Connell also notes. Grocery tenants and fitness tenants, are among the few tenants currently seeking Big Box units, but while such spaces are available, few genuinely meet most grocery tenants’ preferred size and location requirements. “Both parties truly prevailed in this deal,” O’Connell says, adding “Grocery Outlet slots into a prime retail location and the landlord executes a long-term lease with a secure credit tenant.”
For more information about CBM and their retail leasing and property management services, please contact: Rick Rivera 310.575.1517 x201 | firstname.lastname@example.org.