September 11, 2023

2 Safeway stores in a race toward demolition

Photo by Brian Miller [enlarge]

Closed and doomed, the old U Village Safeway property ...

Both grocery stores are bound for redevelopment, with apartments to follow, but which will be first to its fatal date with the wrecking ball?

The Safeway near University Village shuttered this June, about the same time a new store opened over to the west in the University District proper. The boarded-up old store looks pretty derelict now, with its parking being rented on football game days, while the neighborhood favorite Burgermaster survives for now. (It, too, faces demolition.) Quarterra is the builder and developer there.

Then, up on Capitol Hill, that still operating Safeway now also has a demolition permit in process. Greystar is the builder and developer — but not yet the owner. But a joint venture or condominium deal could also be struck with Safeway, which is planning to return to a new store below the apartments.

Rendering by Encore Architects [enlarge]

... will become a 796-unit apartment building.

That five-story, 336-unit plan, designed by Weber Thompson, looks to be very close to its master use permit. It'll span virtually a full block at 1410 E. John St.

Back down to the U Village area, at 3020 N.E. 45th St., Safeway won't return to that 4-acre site — so an outright land sale should follow the MUP, which again appears near. Encore Architects designed that midrise project, with 796 units over several retail bays and structured parking. A demolition permit should come in a month or two.

Both projects have passed through design review. Both projects have been brewing for years. But, in October of last year, a big grocery merger was announced by Kroger and Albertsons (which owns Safeway).

And last Friday, those two parties confirmed the $1.9 billion deal. To gain approval from the Federal Trade Commission, 413 stores and some other properties will be sold early next year to C&S Wholesale Grocers.

Friday's joint announcement said that 101 Albertsons and Kroger locations in our state will be divested. (Remember: Albertsons owns Safeway; and Kroger owns QFC and Fred Meyer, among other brands.) Friday's announcement didn't specify which locations will change hands.

Rendering by Weber Thompson [enlarge]

While on Capitol Hill, that Safeway will survive at least into next year.

Details should emerge before the deal closes; the Capitol Hill Safeway may or may not be on that list. And there's a wrinkle to the announced deal: There's a clause in which C&W might have to buy another 237 stores, if that's the key to gaining FTC approval.

Thus, Quarterra is free to slap down cash and start its demo, while Greystar will have to wait several more months for market clarity. (Quarterra is the rebranded LMC, formerly Lennar Multifamily Communities.) Also on the bubble? Security Properties is planning 146 apartments atop a new Magnolia Safeway (currently an Albertsons, still open); a MUP has been issued there.

And it's conceivable that the QFC at U Village could also wind up with a new owner, too.