Deep Discounters and Alternatives
Deep discounters disrupt any retail category. The continued expansion of Aldiand GroceryOutlet are just the latest to take advantage of available space, targeting savvy customers searching for bargains amid rising inflation.
Aldi carefully evaluated the U.S. market for a number of years before making its first move. With nearly 100 stores in California now, ranging between 15,000 and 20,000 sq. ft., the brand is looking to add 120 new locations nationwide in 2022. The grocer will pursue stand-alone buildings or in-line space within larger centers. Amazon Fresh, which opened its first Southern California location in 2020, and has since expanded to 16 in the region. The novelty of this digitally integrated store attracts customers who also seek to take advantage of intensely competitive pricing.
Owners, prospective investors, and municipalities have all begun to embrace alternative uses as neighborhood center anchors, as well, with health and fitness proving to be among the most successful integrations. Gold’s Gymhas taken advantage of vacant boxes to satisfy its 40,000-sq. ft. requirement. In Cerritos Plaza in California, Gold’s backfilled a former OSH Home Improvement store and gained local approval as a strong complementary co-anchor to Ralphs and CVS.
In 2020, a 40,000-sq.-ft. Hoag Health Center backfilled a former Jo-Ann’s Fabrics at Foothill Ranch Town Center. This innovative concept introduced a comprehensive medical destination, complete with fitness, food, education, and medical facilities inside this community shopping center.
The viability of medical anchors has also extended into the veterinary industry which alone has experienced 4% annual growth during this pandemic era. Coreland’s leasing team negotiated a 10-year deal with high-end pet hospital, Pet Rise. The new concept will absorb a 20,000-sq.-ft. anchor space in Laguna Hills, Calif., and expects to draw patients from a 10 to 15-mile radius.
Rising labor costs, fuel costs, and shipping and delivery constraints have impacted traditional neighborhood center anchors like Ralphs, Vons and Albertsons. However, even players within this segment have seen expansion and growth.
Stater Bros. is one of the best examples of an expanding traditional grocer. Having opened its very first store in the midst of the Great Depression in Yucaipa, Stater Bros. has remained connected to the Inland Empire and has targeted growing communities and vibrant new developments. A 45,000-sq.-ft. Stater Bros now anchors Ontario’s New Haven Marketplace, which features quick-service restaurants, local services, yoga, and fitness. At The Groves Whittier, a new 44,000-sq.-ft. Stater Bros replaced its former location on Whittier Boulevard and will set the stage for the complementary uses that will include retail, fitness, food, and integrated public market.