Safeway Closing 24 Stores Statewide : 3 in S.D. County Among Smaller Sites Targeted by Oakland Chain
Safeway’s Southern California division plans to close three supermarkets and a warehouse in San Diego County, a move that will affect more than 140 employees, company and union representatives said Monday.
The closings, part of a statewide move that will close 24 stores, will leave the Oakland-based company with 44 stores in San Diego County. Most of the closings involve smaller stores. Safeway has been moving toward larger stores with 40,000 square feet or more of space that can accommodate delicatessens, salad bars, pharmacies, video rentals and other services for which customers are clamoring these days.
In San Diego, Safeway will close stores at 1250 Rosecrans St. and 9340 Mira Mesa Blvd. In National City, Safeway will close a distribution warehouse and a store at 1608 Sweetwater Road. The company hopes to sell the stores that will be closed.
“We’ve been evaluating our stores for quite some time,” said Bonnie Lewis, a spokeswoman for Safeway’s Southern California division, which now has 200 stores. “These older, smaller stores simply are not able to provide that service that our customers have come to expect.
“Some are in minority areas, some are not,” she added. “There is no thread except for the fact that they are older, smaller and unprofitable.”
Lewis disputed reports based on information from union sources that as many as 800 employees would lose their jobs as a result of the March closings.
“Our figures show that it may go as high as 500,” including some jobs to be eliminated March 28 when the company consolidates its National City warehouse and trucking operation with one in Santa Fe Springs, Lewis said. She added that all layoffs, which will represent about 4% of the current Southern California work force of more than 12,000, will be according to seniority.
The National City warehouse closing will affect 83 members of Teamsters Union Local 543, according to Secretary-Treasurer Lou Cotarelo.
“It all depends on how many people choose to retire rather than go to work in L.A.,” Cotarelo said. “What it comes down to is having to go from lovely San Diego to the abominable Los Angeles area.”
The store closings will affect about 60 members of the United Food & Commercial Workers Union Local 1222, according to a spokesman. However, any layoffs would be determined by the union’s seniority listings, the spokesman said.
In addition to the San Diego County stores, Safeway will close a Highland Park store, two in Bakersfield and one each in Bell, Canoga Park, Corona, El Monte, Fontana, Granada Hills, Hawthorne, Huntington Park, Lomita, Newhall, Orcutt, Oxnard, San Gabriel, Saugus, Simi Valley, Taft, Thousand Oaks and Van Nuys.
Eastdil Realty, a San Francisco real estate office that is negotiating sales of the stores, would not comment. However, Jack H. Brown, chairman of Stater Brothers in Colton, said his company is evaluating the locations and might consider buying a few of them.
Ken Johnson, a consultant with Price Waterhouse in Los Angeles, said the closings are “exactly what I would have expected. Almost all the big chain competitors have found that their smaller, older stores are not competitive.”
He added that Safeway’s $4.2-billion buyout by the investment banking firm of Kohlberg Kravis Roberts, which loaded the company with debt, “may have hastened the (closing) process somewhat, but the overall rationale is basically the same, post-buyout or pre-buyout.”
At least one competitor near a doomed Safeway is hoping his business will benefit.
“We expect and hope to get some increased volume from their closing,” said Don Hall, owner and manager of Hallmart Foods in Taft.
Martha Groves reported from Los Angeles and Greg Johnson from San Diego.
