Thursday, February 10, 2011

Tesco's Fresh & Easy Neighborhood Market Breaks Ground Today For Second Store in South Los Angeles

Los Angeles Mayor Antonio Villaraigosa (pictured above) at the podium during today's groundbreaking ceremony at the site of the future Fresh & Easy market in south Los Angeles. Meanwhile, the earth-mover behind the mayor did some "ground- breaking" of its own today during the event.

Southern California Market Region: Los Angeles

A who's who of local elected officials turned out today for the ground breaking of the new 45,000 square-foot West Angeles Plaza commercial office and retail center at 3501 West Jefferson and Crenshaw Boulevards in south Los Angeles, California, which will be anchored by a Fresh & Easy Neighborhood Market fresh food and grocery store.

The project, long in the making, is the vision of Bishop Charles E. Blake and his teams at the West Angeles Church of God in Christ and West Angeles Community Development Corporation (CDC) in south Los Angeles.

The vision was transformed into reality today, as a backhoe broke the dirt at the site of the new center, while Bishop Blake, Los Angeles city and county elected officials, and a representative of Tesco's Fresh & Easy Neighborhood Market all took turns saying a few words about the project at a podium set up on the bare grounds when retail stores and office building are set to sprout over the next 12 months.

Among the elected officials attending and speaking at today's West Angeles Plaza center ground breaking in south Los Angeles was the Mayor of Los Angeles, Antonio Villaraigosa, who spoke about the about 150 new jobs the new project, including the 20-30 positions at the Fresh & Easy market when it opens, will bring to the low-income community, along with discussing the benefits of having a new grocery store in the neighborhood, which is underserved by supermarkets offering fresh foods and groceries at affordable prices.

Also attending and speaking at today's groundbreaking were Los Angeles City Councilmember Herb Wesson and County Supervisor Mark Ridley-Thomas; Los Angeles City Controller Wendy Greuel; Bishop Blake; and Mary Kasper, vice president for legal and public affairs at Tesco's Fresh & Easy Neighborhood Market, who said: "We want to continue to be part of the solution in providing greater food access and healthier food options to all types of communities. We've found everyone wants access to the same types of foods – fresh produce, quality meats and poultry, and family staples like eggs and milk – at prices they can afford, right where they live."

In addition to a 10,000-12,000 square-foot Fresh & Easy market, the first phase of the 45,000 square foot West Angeles Plaza development is set to include a bank and commercial office space, according to Bishop Blake.

From there, plans call for adding more retail stores in a strategy designed to further position and reinforce the center and Crenshaw Boulevard as the principle mercantile street in South Los Angeles, according to the West Angeles CDC, which is developing the 45,000 square-foot retail and commercial office center, which has financing from numerous government and private sources.

The Fresh & Easy store on the corner of West Jefferson and Crenshaw Boulevards will be the second unit in south Los Angeles for Tesco's Fresh & Easy Neighborhood Market, which is headquartered not far way in the city of El Segundo.

It was a nearly year ago this month in fact, on February 24, 2010, that Tesco's Fresh & Easy opened its first south Los Angeles market at Central and Adams. [See - February 24, 2010: Fresh & Easy Store Opens its Doors in South Los Angeles

The 3501 West Jefferson & Crenshaw store, the grocer's second store in south Los Angeles, is set to be completed and opened no sooner that the end of this year, and most-likely in early 2012.

Most of south Los Angeles is considered a "food desert," meaning residents of the highly-populated, lower-income region of Los Angeles are underserved by grocery stores that offer a full-selection of fresh food and grocery products at decent or affordable prices. One of Fresh & Easy Neighborhood Market's stated goals is to open stores in food desert communities like south Los Angeles. Thus far, about four -to- five of Tesco's 96 Fresh & Easy markets in Southern California are in food desert regions and neighborhoods.

Tesco currently operates 159 Fresh & Easy stores - 110 units in California, 28 markets in Arizona, and 21 stores in Nevada.

Los Angeles, including south L.A., is a major focus for the grocery chain when it comes to new store development. For example, as we eported in a December 10, 2010 story - Fresh & Easy Neighborhood Market CEO Tim Mason Says 70 New Stores Possible in Los Angeles Area Tesco deputy CEO and Fresh & Easy USA CEO Tim Mason told a Southern California business group that he and his team are looking at opening up to 70 stores over the next couple years in the Los Angeles area.

Additionally, in a January 23, 2011 story - Tesco's Fresh & Easy Neighborhood Market Looking For Locations For New, Smaller-Format 4,000-to-5,000 Square-Foot Stores - we broke the news that Tesco's Fresh & Easy is looking for locations for smaller-format stores, which it plans to open in addition to its 10,000-12,000 square-foot markets. A number of the sites Fresh & Easy is looking at for those smaller stores are in the Los Angeles area, along with other parts of Southern California and in Northern California, as we reported in our January 23 story, which has since been picked up by the Oakland Tribune (January 27, 2011) and Financial Times (February 1, 2011), although neither publication attributed Fresh & Easy Buzz as the original source of the information, which we are.

As we've reported previously, Tesco says it plans to have 400 Fresh & Easy stores open and operating about two years from now, a number it says it needs, all receiving product from its Riverside County California distribution center, in order to break even with Fresh & Easy by the end of its 2012/12 fiscal year.

In order to get to that magic 400 stores over the next two years, Tesco's Fresh & Easy has to open 241 units in that time period, which is 82 more stores than it's opened in the three-plus years since November 2007, when it began opening Fresh & Easy stores. There are 159 stores as of today. The simple logistics of achieving the opening of 241 stores over two years is extremely difficult, let alone is the prudence of doing so, because finding and opening that number of quality locations in such a short amount of time is near-impossible, in our experience and analysis.

According to our sources, currently strategy calls for Tesco's Fresh & Easy to open the majority of these planned 241 new stores - a mix of the traditional 10,000-12,000 square-footers and new 4,000-5,000 smaller-format markets - in California. And Los Angeles, along with other parts of Southern California, Northern and Central California are key in this strategy. Some added stores will be opened in Nevada and Arizona, and potentially (at least theoretically) in any other nearby state (not many if any) that can be distributed to out of the Riverside County distribution facility in Southern California.

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