Moving Day Nears for Wholesalers : L.A. Produce Merchants to Get New Facility Next Spring
At the Los Angeles wholesale produce market, the frenzy begins at 1 a.m., six days a week. Bleary-eyed buyers and sellers wend this way and that carting peaches, loading pears, shouting prices, answering telephones. Giant coolers open and shut. Workers, earning $12 to $15 an hour, hardly have time to take a sip of coffee or to rub the goose bumps from their arms.
By 4 a.m., Buddhist monks are apt to arrive from the Mt. Baldy Zen Center 50 miles to the north. Hoping that merchants will donate unwanted vegetables for their retreat, the monks wait amid boxes of Grand Slam cantaloupes from Arizona, Big Time peppers from California and Ace O’Spades corn from Oregon. The lights reflect as easily from their shaved heads as from the smooth skin of melons stacked nearby.
The activity slows about daybreak, when many people walk from the Wholesale Terminal at 8th Street and Central Avenue to Vickman’s restaurant across the street. For 55 years, Vickman’s has filled the bellies of hungry produce workers with its omelets and homemade, fresh-fruit pies.
Every Friday at 6 a.m., Jack Wolf, manager of the nearby branch of First Interstate Bank, which lends money to many of the fruit and vegetable dealers, makes the rounds of merchants to find out who is doing well and who is not. He also weighs himself on giant produce scales to make sure his consumption of Vickman’s pastries hasn’t added too many pounds.
“I love this place,” he says, seated at the restaurant. “I’m sure glad the market is staying.”
Since the mid-1970s, the produce merchants have made repeated threats to move out of Los Angeles and into modern, cheaper facilities, possibly in Bell or in Orange County. Next spring, after 15 years of uncertainty and often bitter debate among merchants, financial executives and city officials, the produce market will get a new, $90-million home next to the present Wholesale Terminal, which has become worn and cramped since its construction more than 70 years ago.
The money to be made by merchant and city alike on apples and oranges is no small potatoes. Because of the city’s strategic location near growers in the Southwest and ports where produce from Australia and South America arrive, about 40% of the fruit and vegetables consumed in the United States are traded here. The city estimates that the market creates 5,000 jobs directly and indirectly, about 85% of which are filled by minorities.
5-Building Complex
Thus, the mayor’s office has fought hard to prevent the market from leaving. “It was one of the most frustrating things I’ve ever worked on,” said Ted Tanner, an architect in the City Economic Development Office and for eight years a key overseer of the new market project. “And one of the most rewarding. With all the tug-of-wars we’ve been through, I can hardly believe it’s finally going to happen.”
The new 535,000-square-foot, five-building complex at Alameda and 8th streets will be the center of the largest produce market in the country. Los Angeles fruit and vegetable brokers match growers from around the world with buyers such as Ralphs, Safeway and hundreds of smaller grocery stores and restaurants across the state and country.
The 30 tenants in the new facility eventually will own 80% of it, buying an equity stake in the partnership through monthly rent to Birtcher Co., a real estate developer in Santa Ana. Birtcher, which is constructing the new buildings, will manage the facility and retain a 20% stake.
The city has spent years arranging for $26 million in public grants, including $19 million in federal funds, and for the additional $64 million that is borrowed from private lenders and will be repaid by tenants as part of their rent. The city is leasing 21.6 acres of land that it owns to the partnership at below-market rates, and it also persuaded Santa Fe Southern Pacific Corp. to lease an additional 8.3 acres that the market needed and that the railroad company owns but would not sell.
Merchants and city officials estimate that rents will be $1 to $2 a square foot, depending on the amount of additional investment that tenants make to the areas they use. Although the rent at the new facility may be double what some merchants now pay, many said they are getting their money’s worth.
The current markets, in addition to being too small, costs each merchant thousands of dollars each year because they lack loading bays that are level with the back of shipping trucks. This means that workers must lift shipments in and out of trucks instead of wheeling them onto a loading platform, which adds extra hours and dollars to the process. There are other savings, too.
“The rent seem high (at the new market), but not once you analyze all the services you’re getting,” merchant Sam Perricone says. He says that at the old facility, for example, his employees have to move his trucks each night to keep them from the hands of truck-part thieves and then retrieve them each morning; because the new facility will have guards on duty 24 hours a day, he can cut that wasted time and cost.
Since produce merchants first approached the city in the mid-1970s for help in locating a new market, the project was alternately killed by disagreement and revived by necessity so many times that it became known as “the Phoenix,” after the legendary bird that rises from ashes.
Not All Are Happy
For decades, the business has been divided primarily between two markets: the giant Wholesale Terminal at 8th and Central and the much smaller, privately owned City Market nearby at 9th and San Pedro streets. Both will continue to operate after the new market opens, although both will lose tenants to the new facility.
But not everyone is happy. Many fear that customers at the City Market will take their business to the new facility, which in effect is an expansion of the Wholesale Terminal. Los Angeles officials argue, however, that if the market had left the city, City Market would have met certain death.
“The only way to keep the industry here was to create one centralized market,” says Brad Crowe, director of the City Economic Development Office, the agency responsible for the city’s efforts.
Many of the merchants say they are glad to stay in Los Angeles. “There’s never two days the same. Never a dull moment,” says 76-year-old George Woo, who has been a merchant here for 31 years and plans to pass his business, W. Fay Co., to his 28-year-old cousin, Roland (Butch) Chung.
Chung already manages the company, opting for the market rather than college. “I notice more and more young people working here,” he says. “We may have a different attitude, being more business-minded or whatever, but we still love the market. I’d rather work here than anywhere else.”
