News

Palo Alto to vet new grocer for old JJ&F site

Council to consider whether developer's son's business can suitably replace once-popular market

The developer of College Terrace Centre on El Camino Real raised eyebrows earlier this year when he disclosed that his son will be in charge of the center's grocery store, but Palo Alto officials believe the new store could be as good as or better than JJ&F, the venerable market that once did business there.

On Monday night, the City Council will consider a recommendation from city planners to approve J&A Family Market as the grocer tenant of the mixed-use development at 2180 El Camino. The controversial, block-long development was approved in January 2010 after a series of tense community meetings and concerns from the surrounding College Terrace neighborhood about the project's size and density.

Monday's discussion will focus on the grocery store, which is the primary public benefit of the "planned community" (PC) development.

In lobbying for the project, which required the flexible PC zoning, the development team pitched its bid as a way to "save JJ&F Market," a grocery store that operated near the corner of El Camino and College Avenue for 65 years. In addition to the new 8,000-square-foot grocery store that was supposed to give JJ&F more visibility, College Terrace Centre provides 38,908 square feet of office space; 5,580 square feet of other ground-floor retail; and eight below-market-rate apartments.

Though the council approved the development, it did not "save JJ&F" after all. Just months after the vote, the Garcia family -- the longtime, original owners of the store -- sold the business and left Palo Alto, thereby also leaving open the question of who would occupy the store once the development is built.

That question was seemingly answered earlier this year, when it was revealed that James Smailey, son of center developer Patrick Smailey and member of the development team, will run the new grocery. If the council on Monday approves this plan, the store will be called J&A Family Market.

The revelation raised some questions, particularly given that James Smailey has no experience in the grocery industry. In order to allay neighborhood fears of an inferior market replacing JJ&F, the council's 2010 approval of College Terrace Centre included stipulation that the grocer tenant "shall be subject to the prior approval of the City of Palo Alto." Further, the ordinance regulating the development stated the city will not withhold its approval unless the city finds that the tenant "is not likely to be comparable in quality of product and service as JJ&F as it existed and operated on Dec. 7, 2009."

In May, College Terrace resident Fred Balin raised the issue at a council meeting and questioned whether the developer's son is the best person to man the grocery operation. He noted that it would be up to the building owner to enforce the lease conditions of the grocer tenant.

"How enforceable will the lease agreement be that is between father and son?" Balin asked. "How likely is it that a grocery owner with no experience will run a market comparable to JJ&F? Those are key questions before the city now."

But for city staff, James Smailey's lack of experience is not a barrier to approval. The city had hired a consultant, Sutti Associates, to review Smailey's business plan and advise the city on whether the new store will be viable. The consultant's report, which the city publicly released Wednesday afternoon, answers enthusiastically in the affirmative. Lawrence Brucia, president of Sutti Associates, wrote in the Aug. 4 report that while his company "cannot guarantee long term success for J&A Family market," it believes that the market "has the retail team and strategy to be successful from its opening day and into the future."

"J&A Family market will be comparable, if not superior, in quality of products and services to JJ&F market," wrote Brucia, whose company has been involved in designing and building grocery stores since 1976.

There will, however, be some differences, largely reflecting the changing tendencies of modern shoppers. According to Sutti, J&A plans to have more "grab-and-go" products than JJ&F, a larger deli section and a smaller meat department. It will have less produce inside the store than JJ&F did but will have an open market outside, facing El Camino Real.

The report from Sutti Associates also tries to assuage the concerns of Palo Alto's planning staff and residents about James Smailey's lack of experience. The planning department report states that staff believe he is "proposing a store with products and services comparable to JJ&F" but note that "the only outstanding issue is whether the grocery store will be a financial success and remain in operation, unlike other small grocery stores in the area that have failed."

For staff, this is worrisome for several reasons. The city's approval of College Terrace Centre doesn't specify what would happen if the grocery store goes out of business or its quality diminishes after the development is constructed. Though the development would then violate the "planned community" ordinance, the ordinance does not specify a particular remedy or fine, according to Wednesday's report from city planners.

Furthermore, even a "comparable" business won't necessarily be a successful one. After all, despite its popularity, JJ&F left Palo Alto just months after the project was approved. Another grocery store, Miki's Fresh Market, opened at Alma Village amid much fanfare in 2012 only to close down six months later.

City planners note that the financial success of the new grocer is "a particular concern because the tenant has not been willing to share information about the personnel with grocery experience who would be engaged to help operate the business."

In reviewing the plans, however, Brucia concluded that James Smailey's team of advisers have "qualified credentials to participate in managing and advising the owners of J&A Family market." The market's co-manager and CFO is someone with "extensive experience in the grocery business" who worked for his family grocery business, owned his own store and has worked with distributors and vendors. Another adviser has "extensive experience in retail stores," Brucia wrote.

He concluded that given the store's management team, advisers and a new building with new equipment, "the expectations regarding the environment of the store are high."

"A new store will have a fresh start, which represents a clean, well-lighted store and should be maintained by a qualified management team," Brucia wrote.

The new store is scheduled to open in August 2015, according to the business plan provided by Smailey. The plan states that the store's new location, fronting onto El Camino, will bring with it the benefit of exposure to about 60,000 drivers daily. It also boasts of "an all-new building and premises, a history of neighborhood support and a growing client base as Stanford University continues to add residential units to the immediate area."

"With the prospects of growing demand, the opportunity of success for this full-service grocery in a community with exceptionally high barriers to entry is very strong," the business plan states.

The City Council meeting will be held in Council Chambers at 250 Hamilton Ave. on Monday, Aug. 11, starting at 7 p.m.

Comments

 +   Like this comment
Posted by Howard
a resident of Crescent Park
on Aug 7, 2014 at 8:58 am

To the extent there is a problem, it is the absurdity of imposing a "grocery store" requirement for the development, rather than allowing the owner of the property and market forces to determine what sort of retail or service occupies the space.


 +   Like this comment
Posted by Allen Edwards
a resident of Old Palo Alto
on Aug 7, 2014 at 10:31 am

To the comment about letting the property owner do what he wants. That is fine with me if he meets the zoning requirements. That is not the case here. In exchange for building what will probably be a monster, the city wants a growsery store for the community. My preference is to stop letting developers promise community benefit that soon evaporates. Let them build what they want but no zoning variances.


 +   Like this comment
Posted by Grocery retail IS rocket science.
a resident of South of Midtown
on Aug 7, 2014 at 11:16 am

A developer with no grocery experience cannot be successful in the low-margin, highly competitive world of grocery retail. This is a very challenging and highly specialized area of retail.

Without a successful grocery, there is no public benefit. Granting zoning variances based on this plan is not a good idea.


 +   Like this comment
Posted by neighbor
a resident of Adobe-Meadows
on Aug 7, 2014 at 11:24 am

Is a Veterinarian grocer moving in or does the writer need basic English instruction? This isn't the first time I have noticed vet used when it should be vette.


 +   Like this comment
Posted by Retired Teacher
a resident of Duveneck/St. Francis
on Aug 7, 2014 at 11:47 am

Neighbor, "vet" can be used in either sense, to describe the work a veterinarian does or to describe a thorough check on something. I've seen "vette" in Italian, and evidently there's a Dutch word as well. Or it can be used colloquially to refer to a Corvette. I've not seen in used in English otherwise; perhaps you can supply a reference or two.

Beware of questioning someone's basic English skills until you've checked some sources...


 +   Like this comment
Posted by Joe
a resident of Another Palo Alto neighborhood
on Aug 7, 2014 at 12:02 pm

> Palo will be no semblance of the vision we hold for it.

Unfortunately, no comprenshive land use policies/visions have ever been put out to vote, so most of the people (ie, voters) have ever had a chance to vote on any of these matters. The most of us have had the visions of a few activists shoved down our throats with little in the way of overturning, or endorsing, the City's policies.
-----

What's missing from this story is some explanation of the right of the City to involve itself in this level of execution of the project. The fact that developer drank the Koolaide and sought a PC zoning probably gives the City some amount of influence in the projects impact on the neighborhood, and presumably in the so-called "public benefit"—but it seems that questioning the choice of general manager of the future store, as well as demanding all sorts of financial information, is way out of line.

Palo Alto would be a lot better off if PC zoning were removed from the Zoning codes. It's the sort of thing that would make a good ballot initiative.


 +   Like this comment
Posted by Local gurl
a resident of Greenmeadow
on Aug 7, 2014 at 12:13 pm

Better than JJ&F? Not a chance.


 +   Like this comment
Posted by neighbor
a resident of Adobe-Meadows
on Aug 7, 2014 at 12:14 pm

Retired Teacher: Thanks for your correction. I most frequently see the word as vette in this context so I was surprised to hear that vet is considered proper. Next time I will do more research.


 +   Like this comment
Posted by anon
a resident of Evergreen Park
on Aug 7, 2014 at 2:25 pm

from the article:

"City planners note that the financial success of the new grocer is "a particular concern because the tenant has not been willing to share information about the personnel with grocery experience who would be engaged to help operate the business."

"In reviewing the plans, however, Brucia concluded that James Smailey's team of advisers have "qualified credentials to participate in managing and advising the owners of J&A Family market." The market's co-manager and CFO is someone with "extensive experience in the grocery business" who worked for his family grocery business, owned his own store and has worked with distributors and vendors. Another adviser has "extensive experience in retail stores," Brucia wrote."

The applicant is not willing to share the names of individuals they claim will be running the store???
Did staff insist? It is incredible to me that they would even consider moving forward without such information!

Are you kidding me? James Smailey has no grocery experience, his own company/father is in charge of enforcing the lease against himself/his son, the applicant won't even release the name of the so called experts in the difficult and competitive grocery field…..
( think Mollie stones, country sun , Traders Joes the farmers market all in the immediate area )
…and staff and the consultant staff hired are recommending letting this giant project go forward ???? Why?

Time and time again the public has been robbed of the so called Public Benefits of the monster PC developments; time for the city council to take a stand and say no without a thorough vetting of all the individuals, the business plan the lease.

Its not hard to imagine a situation where the residents are left with a small sandwich shop with a few necessities on mostly empty shelves and a happy property manager and family trust laughing all the way to the bank!!!


 +   Like this comment
Posted by curmudgeon
a resident of Downtown North
on Aug 7, 2014 at 2:50 pm

"What's missing from this story is some explanation of the right of the City to involve itself in this level of execution of the project. The fact that developer drank the Koolaide and sought a PC zoning probably gives the City some amount of influence..."

That's exactly what happened. And the neighbors partook of the Koolaid and believed Professor Harold Hill the Grocery Man. And the city took its sip, believing it could get a real public benefit.

Or more likely the city followed Smailey's script, ostensibly and ostentatiously demanding a grocery store in return for allowing this huge, hugely profitably development, while following its custom of omitting any possibility of enforcement.

Tough luck, CTers. You get the broccoli but no dessert.

Lesson: every PC zoning ordinance should be vetted by the voters in a referendum. The present system gives away our town's character for private profit, for no public return.


 +   Like this comment
Posted by Sparty
a resident of another community
on Aug 7, 2014 at 3:08 pm

Sparty is a registered user.

Only takes about 3 seconds to google "vet" definitions.


 +   Like this comment
Posted by neighbor
a resident of another community
on Aug 7, 2014 at 6:47 pm

I found JJ&F to be terribly dirty -- left and never came back. Anything would be an improvement.


 +   Like this comment
Posted by Neighbor
a resident of Old Palo Alto
on Aug 7, 2014 at 8:01 pm

@ Sparty

I guess we will start calling you Spartypants!


 +   Like this comment
Posted by Annette
a resident of College Terrace
on Aug 7, 2014 at 8:50 pm

Annette is a registered user.

The developer used community affection to get a PC variance. In exchange the community was promised a regular neighborhood-serving grocery. That was (is) the deal. Maybe Smailey's son can deliver, but what happens if he cannot? Does Smailey get to return to CC, throw up his hands and say, "I tried, but competition is tough and the grocery requirement is an unfair burden that cannot be met"? Is he then released from the requirement to provide a public benefit? Was this the plan all along? It will be interesting to see how CC handles this request for a non-grocer to be accepted as a grocer.

@neighbor - you may not have had the pleasure of shopping at JJ&F when it was at its best. Once the development plan started the owners weren't inclined to invest in tenant improvements. That's understandable but the tired look wasn't in JJ&F's control. Also, I think the reason the community sought to "Save JJ&F" had everything to do with the Garcia family. They were great!


 +   Like this comment
Posted by Jimmy
a resident of College Terrace
on Aug 7, 2014 at 9:52 pm

I found JJ&F to be dirty and had some bad experiences with molded cheese and stale bread... CT residents & activitist, please give the kid a chance & lets focus on the things that really matter.


 +   Like this comment
Posted by ChrisC
a resident of College Terrace
on Aug 8, 2014 at 1:02 am

ChrisC is a registered user.

Why can't we have a Piazzas in College Terrace? I wonder if any of the Piazzas have thought about it. That's such a great market.

Jimmy, I think the mold and stale bread must have been after the Garcia family sold JJ&F.


 +   Like this comment
Posted by Seaa-Seelam Reddy
a resident of College Terrace
on Aug 8, 2014 at 7:02 am

Food for thought

Why re-invent? Can the owner work with one of the recent successes grocery store operators?

- Bristol Farms
- Dean and Deluca cute little store
- Safeway cute little store
- Draeger Menlo Park like store to name a few. I bet there are half a dozen more.

Respectfully


 +   Like this comment
Posted by Mark Weiss
a resident of Another Palo Alto neighborhood
on Aug 8, 2014 at 9:54 am

Why we are at it, why don't we vette the developer of Alma Plaza and his relationship with his grocer tenant, the one that filed for bankruptcy soon after opening, which is a public document and seems to say, according to another local paper that the developer-grocer relationship was less landlord-tenant and more backer-backee or worse; vette them and use that experience here, or do nothing, but look into it.

That story, Alma Plaza I mean Alma Village as prelude to JJ&F Plaza or whatever, is consistently reported with developer saying "I never collected a dime of rent from the guy, to help him" but could have more truthfully be reported as "I actually paid the guy to open his doors, with my profits from the upzoning on housing".

Those who don't know history are condemned to repeat it.


 +   Like this comment
Posted by neighbor
a resident of another community
on Aug 8, 2014 at 10:48 am

Annette -- re: the dirty JJ&F store.

Despite his lease problems, the JJ&F market owner could have swept the filthy floor and taken rotten food off the shelf. That is pretty basic.


 +   Like this comment
Posted by Floyd
a resident of Downtown North
on Aug 8, 2014 at 11:33 am

Bristol Farms. Now that's a great idea.used to shop at one in Palm Desert area.
better than Draeger's and Whole Foods by far.


 +   Like this comment
Posted by Sea-Seelam Reddy
a resident of College Terrace
on Aug 9, 2014 at 8:26 am

Thanks Floyd.


I have good experience with them.

Here is where I found Bristol Farms; they have multiple sizes; hope 2100 El Camino has good Sq Ft. for their sizes

Newport Beach - Medium size next to a big Fashion Island in another shopping center location across library

El Segundo/Manhattan Beach - next to nice homes/businesses 5 miles south of LAX; sort of our neighborhoods

Palos Verdes - Residential and up on the hill and a smaller one where they started the Company.

Could the right people call them ask if they are interested? They already have one across Union Street next door to Bloomingdales and Nordstroms on Market Street in SF.

Respectfully

I was a resident of Newport Beach and a worker at Hughes and Boeing where they had Bristol Farms and was in Walteria


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