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Safeway Sign

Workers removed the signs from the earthquake-damaged downtown Safeway last April.

Efforts to find a new tenant are complicated by Safeway’s desire not to have a competing grocery on the site. Safeway still holds the lease on the property.

Everyone – from the landlord, to Safeway, the city and residents – seems to want something to reopen in downtown’s shuttered Safeway building, but chances are it won’t be another grocery store.

“We are trying desperately to negotiate with Safeway to get them out of the lease so we can do something with the property,” said landowner Corinne Hagstrom Vasquez of Hagstrom Properties in Contra Costa County.

One big holdup is a non-compete clause that allows Safeway control over potential subleasors, such as another grocery store. Another market could be seen as competition for Safeway’s other Napa store.

“We continue to market the former downtown Napa store for sublease and we are working closely with the property owner to evaluate the best use for the space,” wrote Safeway representative Wendy Gutshall.

“It’s frustrating,” Hagstrom Vasquez said. “I want our options to be open. I want control over the property.”

The store was damaged in the August 2014 south Napa earthquake and never reopened. Safeway announced last May that it would not make repairs and redirected shoppers to its north Napa store.

City of Napa Economic Development Manager Jennifer LaLiberte said the city has had conversations with various real estate brokers and grocery operators but Safeway’s active lease and non-compete clause have been a stumbling block.

In addition, remediation to contain contamination from a former dry cleaners continues next to the market.

The city is marketing the site, but those challenges “make it very difficult,” she said.

“We’ve consistently been working with the property owner who has hired brokers both regionally and locally for replacement,” said Mayor Jill Techel.

The ball is in Safeway’s court, said Hagstrom Vasquez. “It’s not the landlord dragging their heels.”

In a phone interview, Hagstrom Vasquez said, “We keep pushing and trying to get answers and were not getting anything right now.” She declined to elaborate on her discussions with Safeway.

Hagstrom Vasquez said she’s also concerned about the condition of the building, which has some structural problems from the earthquake, particularly at the northwest corner. Safeway is responsible for repairs, she said.

“I’d like to have the building whole,” said Hagstrom Vasquez. “God forbid if there’s another earthquake.”

In the meantime, downtown resident John Poole took it upon himself to conduct an online survey of locals to measure the extent of their support for a downtown grocery store.

“I wanted to gauge how many people will do something about it and where they live,” said Poole.

The overwhelming majority of the several hundred who responded said they wanted a grocery store at the site.

He describes downtown as a “food desert,” which the U.S. Department of Agriculture defines as when at least 500 people and/or at least 33 percent of the population lives more than one mile from a supermarket or large grocery store.

“It doesn’t make sense to have the property sit there for two years,” said Poole. “Something should be done.”

“I feel very badly for the elderly community” that lives in the downtown area, Poole said. “The carpet’s been pulled out from under them.”

Those seniors now must take a shuttle or walk a substantial distance to other grocery stores, he said.

Poole, who is married to Napa Councilmember Juliana Inman, said he’s planning on forming a group of people who are “doers, movers and shakers” and come up with a strategy.

He was critical of Safeway’s decision to begin sponsoring a PGA golf tournament at Silverado Resort this fall. “Safeway is presumably is spending over a million dollars” on the upcoming Safeway Open in Napa, he said. “At the same time, they are forcing elderly people to travel over a mile to get basics.”

“The poll showed that people want a downtown grocery store. I agree with them,” said Mayor Techel. “We have done outreach to prospective developers and continue to monitor the situation.”

“We are also having conversations with developers” about opening a market, perhaps at a different site downtown, the mayor said.

If there is another downtown site that would be good for a grocer, the city will help facilitate a lease, but there aren’t a whole lot of large sites in downtown, LaLiberte said.

“It’s a bit of a conundrum,” she said.

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Business Editor

Jennifer Huffman is the business editor and a general assignment reporter for the Napa Valley Register. I cover a wide variety of topics for the newspaper. I've been with the Register since 2005.

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