New Seasons Market Abandons Lease in Hayes Valley

The decision is a major blow to the neighborhood, which is growing rapidly — but doesn't have a grocery store.

A long-anticipated grocery store set to open on the border of Hayes Valley and Western Addition hit a major bump in the road this week, when grocer New Seasons Market canceled its lease for a 29,000 square-foot space on the ground floor of a building on Fulton and Laguna streets. The Portland-based chain had been in talks with the neighborhood, Acting Mayor and District 5 Supervisor London Breed, the Planning Department, and the owner of a new development at 555 Fulton St. since 2015

“After years of hard work with the community, the developer, and New Seasons Market leadership, I was devastated to learn that New Seasons Market will no longer occupy the ground floor space at 555 Fulton,” Breed tells SF Weekly. “Though this is a big loss to our community, I remain committed to searching for healthy, affordable and accessible options for this space. The Western Addition and Hayes Valley neighborhood deserves a market that reflects it’s incredible diversity and community values, and we will not let up until we find the perfect fit.”

The decision is a major blow to a neighborhood, which is undergoing enormous residential growth. Parcels of land formerly occupied by the highway, which came down after the 1989 Loma Prieta earthquake, are being turned into massive housing developments. The nearby Hub, at the intersection of Van Ness Ave. and Market Street, will see as many as 9,000 units of housing constructed in the next decade. But once residents move in, they’ll face a very basic problem: nowhere to buy groceries.

It’s something that Breed has spent considerable time working on during her time as supervisor. She flew out to Portland with several members of the neighborhood to tour New Seasons in 2016, before deciding that its mix of inexpensive brands and commitment to organic, healthy food was a perfect choice for a mixed-income neighborhood like the Western Addition. A lease was signed by the grocery store in March of last year. 

But the development has long been plagued by delays. A temporary lift on a neighborhood-wide formula retail ban had to be approved by the Planning Commission in order for the grocery store to be allowed to open up. The design of the building oddly changed during construction, pushing things back even further. And the Chinese developer has even undergone name changes during this process, switching from Fulton Street Ventures to Z & L Properties.

Nevertheless, if Breed and the Hayes Valley Neighborhood Association has their way, a grocery store will still open up in the space. 

“There will be an affordable grocery store there,” says President Gail Baugh. “That was our commitment to the community from the beginning, two supervisors ago. The Planning Department agreed that this is what would happen, and it will happen. We can’t have a vacuous 30,000-square-foot empty hole in the middle of the Western Addition.”

UPDATE: New Seasons Market responded to our requests for comment with the following statement:

“As a part of our annual evaluation for our store growth strategy, New Seasons Market has decided to terminate the lease in Hayes Valley. It’s a wonderful neighborhood, and there were multiple reasons for this decision (operational complexities, construction delays, other considerations) which was not made lightly. Today’s retail and grocery landscape is vastly transforming. We’ll continue to assess how to best meet the changing needs of potential customers and keep this area on our radar for the future.”

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