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UPDATE: On Nov. 16, the City Council approved a request from Khaled Taffi to open the Real Produce International Market at College Terrace Centre.
A family-owned and operated grocer could open in the College Terrace Center before the holidays if the Palo Alto City Council approves its proposal on Nov. 16.
Real Produce International Market could occupy the vacant 8,000-square-foot space in College Terrace Centre at 501 Oxford Ave. as soon as two to six weeks after the vote, according to a report from the city’s Planning and Development Services Department. The new market would offer high-quality fresh produce, meats, organic and international products, coffee service, a deli, a grab-and-go area, fresh flowers “at good prices,” online shopping and free, same-day delivery to Palo Alto residents, CEO and manager Khaled Taffi said by phone on Wednesday.
Taffi and his partners own and operate two produce wholesale businesses in South San Francisco and Oakland and a retail grocery store in San Jose.
“The grocery business is in my blood,” he said, noting that he has been involved since his youth. His father was also a grocer.
Real Produce International would take over a space that is mandated by city ordinance for use by a grocery store. The Oxford Avenue site was once the longtime location of JJ&F Market before the lot was redeveloped into a mixed-use building.
The center’s developer was required to provide space for a grocer in the 57,900-square-foot, mixed-use building at 2100 El Camino Real. The ordinance made the grocery tenant subject to city approval. Residents had fought hard and long for a replacement for the beloved JJ&F Market, which served local families and businesses for 65 years. The council approved a restrictive covenant requiring the grocery store in 2014.
But maintaining a viable market has proven difficult. The first market that moved into the center, College Terrace Market, owned by investors The Grocery Men 1 LLC, was met with fanfare when it opened in 2017, but it closed after six months, in part due to a failure to obtain adequate signage, the owners said at the time.
A second grocer, Khoury’s Market opened in January 2019 and operated for about a year, closing this past January. The building had been enshrouded by scaffolding and netting for exterior modifications and repainting, causing an unattractive appearance and reduced visibility, according to the store’s owners.
Taffi said Real Produce International Market has a good chance to succeed where the other two markets failed. He can source fresh produce from his wholesale businesses, so the market will offer the freshest products at lower prices, he said.
The family’s grocery store in San Jose has thrived even while competing with Trader Joe’s and Costco in the same shopping center. Customers of the San Jose store had been asking the family to open in Palo Alto, he said.
“We have invested a lot of money in this business. … A lot of people think the success of the business will be difficult, but we will bring quality and good prices. We will be the life on the block. It will be a magnet,” he said.
College Terrace resident Melanie Grondel has been actively recruiting potential grocers since Khoury’s Market closed. She noted that Palo Alto residents had driven down to San Jose to shop at Real Produce, and she was among those who encouraged Taffi to open in Palo Alto.
“It’s very much in a JJ&F spirit of a grocery store. They have the basic product line of JJ&F and are very committed to being a part of the community,” she said.
Every two weeks or so, Grondel said she looked in the store’s front windows to see if anything was happening. One day she met Taffi outside the door.
“We talked about what he is planning to do. He wants to have a nice outside terrace like Sigona’s and have sandwiches outside with parasols and seating and a deli and the grocery store with a butcher and fresh produce,” she said.
Grondel said she thinks the neighborhood and surrounding community still need a grocery store.
“I walk with a cane,” she said, and many people are older or can’t drive to a store. Adjacent Stanford University has many young families, and despite the pandemic, there are still many people on the campus, she said.
Doria Summa, a city planning commissioner, said as a College Terrace resident and not on behalf of the commission that Real Produce “seems like a good fit to me.”
The property owner has repainted the building and fixed up the parklet behind the building.
Photos of the San Jose store online remind Summa of Sigona’s, the Stanford Shopping Center grocer, she said.
“There are tons of fresh produce and a little bit of everything else you might need,” she said.
Summa said she hopes the new store will prosper.
“We’ve had two grocery stores fail,” she observed. “I’m really concerned about the finances for a grocer in such a small store.”
Fred Balin, who supported the previous two markets, said in an email: “Disappointed twice, but (I) am encouraged by Mr. Taffi’s enthusiasm, track record, and plans. Opening the rear parklet for customers is a new opportunity. If the city stays firm on penalties, the landlord provides adequate signage, shop local is more than a slogan, then the public benefit can be both real and lasting.”
Opening the market in advance of the holiday season is important, Taffi said in an Oct. 9 letter to city Planning Director Jonathan Lait.
“While times are tough right now for so many businesses with (the) COVID-19 pandemic, safety concerns, and increased regulatory restrictions for businesses in these times, we take the long view and have signed a long-term lease for the grocer space at 501 Oxford Ave. We are excited for the opportunity to serve the community. We want to open our doors as soon as possible and if there isn’t a delay from the city or county, we would love to open before Thanksgiving,” he wrote.
Staff is recommending the council approve the market.
“A stable market at this location has been a long-desired goal by the City Council and neighborhood when it approved the College Terrace Centre development. Having another grocery store that provides essential services and goods to the Palo Alto community is particularly beneficial during the pandemic, which will provide in-store and same day delivery service,” a staff report in advance of the Nov. 16 council meeting noted.
The proposal for approval is scheduled on the council’s consent calendar, but it could be pulled for additional discussion. If three council members vote to pull the item off of consent, staff is recommending the council vote on the proposal that same evening to help the market’s owners quickly open — if the tenant is approved.
AGB Pact, a partnership between Blox Ventures and Angelo Gordon, owns College Terrace Centre. Jason Oberman, CEO of Blox Ventures, deferred comment on the proposed grocery store to Taffi.
A grocery store is required at College Terrace Centre as a “public benefit.” Under the planned community ordinance, the city can levy daily penalties of $2,000 after a cumulative six-month grace period if a market is not operating at the site. The repeated absence of a grocery store at the site over the years has resulted in penalty assessments in the hundreds of thousands of dollars for AGB Pact.
New York-based Greystone Property Development sold the center to AGB Pact for $78 million on June 29, 2018, just prior to when the penalties were due to begin.
AGB Pact has appealed the fines. Some of the appeals are currently undergoing the city’s administrative process and others are being litigated in Santa Clara County Superior Court. The council’s approval of Real Produce International Market is independent of the legal issues, according to the staff report.
Editor’s note: A previous version of this story incorrectly identified the parklet as one of the public benefits required under the planned community ordinance.
Another high priced grocery store? (I only see a grocery succeeding in this spot if it offers something unique.) Palo Alto needs a market that specializes in Asian food. We don’t have that – but we have plenty of stores specializing in high-priced groceries.
A successful grocery store at this location would be good (and promised).
To the new owners / managers: each time I visited the store in the past, the aisles were under-lit and the ambience was somewhat depressing. I just wanted to get out of there. Compare and contrast this to the lighting situation at The Market at Edgewood Plaza…. very light and cheery with sophisticated lighting. I would willingly browse at The Market.
This situation is another cautionary tale about the many pitfalls of overdevelopment. The developer (because of an overdevelopment-hungry council majority the last many years) may perceive an incentive to claim that a grocer can’t succeed there, and regardless, will keep pressuring the city to weasel out of this promise that enabled the large development. Overdevelopment locally has resulted in many ills that the public pays for in their quality of life, in their access to their jobs, in their very livelihoods, their health, the environment, and it’s enabled mostly by lies and false promises. (I hope people have a little more understanding of how easy it is for a national politician to lie for 4 years even over things that are very obviously untrue, and still people believe it because they want to believe it. It happens on the other side of the aisle with overdevelopment, when all the evidence is that it displaces low-income people and ratchets up the cost of housing — and that the demand side with better job concentration policies, which took the pressure off suddenly with the pandemic — is where the realistic answers are.) But so long as developers can make so much money in an in-demand place, they will put pressure on doing whatever they want regardless of the negative consequences to the community.
Is it too sarcastic to open a pool on when this new store closes and the city clowncil mandates another failure. Can we mandate that all the local citizens that forced this to happen have to show receipts that they have spent a minimum of $50 per week at this store or we fine them?
/marc
Hopefully all parties now understand that having the market is like paying your utility bill.
If the landlord does not pay the utility bill, then tenants will not continue to pay rent.
Likewise, the landlord needs to make the terms of the lease to the grocery store are sustainable over the long run. Even to the point of paying the tenant 5,000.00 per month subsidy. That sure beats 60,000.00 per month penalty for not having a grocery store. Lets hope the landlord understands this now.
Poor new grocers. Unless and until there’s visible parking, this one too is doomed to fail. There would have to be something very very special in that location for it to work.
Shame on the “planners” who approved that building. The developers should be forced to renovate to fix the parking situation. And yes, it would be costly but they should be forced to do it.
@ marc665 …. you hit the nail right on the head. Locals need to stop complaining about not having a market there and support it by shopping for most, if not all their groceries at the store. Of course prices will be higher, but hey, you demanded a market for your convenience. Stopping in for a carton of milk or loaf of bread, while purchasing everything else at another market won’t do it and the owners will be in the same boat as the previous two fails. I love the $50 fine idea. Put up or shut up.
> “Palo Alto needs a market that specializes in Asian food.”
^ Why? ‘Basic’ Asian cooking ingredients are available at most grocery stores these days & for those seeking the more exotic, a run to 99 Ranch will usually suffice.
>”Locals need to stop complaining about not having a market there and support it by shopping for most, if not all their groceries at the store. Of course prices will be higher, but hey, you demanded a market for your convenience. Stopping in for a carton of milk or loaf of bread, while purchasing everything else at another market won’t do it…”
^ A good point but most savvy shoppers tend to be on the frugal side.
If grabbing a quick carton of milk or a loaf of bread are all that is needed in College Terrace, just put in a 7-11 and be done with it.
On the other hand, if this conceptual new grocery store were to specialize in something (i.e. like the former JJ&F meat department) then maybe they could drum up some business.
I don’t know who all these locals are that “forced“ the new developers to include a grocery store in their plans. I had never heard of them before this. They sound like big meanies. Here is why I don’t think any grocer will work in that spot:
1. That location is not the location of JJ&F or the replacement to JJ&F. It’s a block away. It is not seen easily when turning from El Camino down College Avenue. It is quite simply not as convenient.
2. Signage. Signage. Signage. (Or none, as it were.)
3. Parking is horrendous. The beauty of JJ&F was that you turned the corner and immediately saw a place to park, you‘d zip in, and run into the store. In the new location, by the time you drive underneath the building, find a place to park, figure out how to walk back up to street level and into the store, you’d already be home in the old place.
AND if you are traveling north on ECR and miss College Ave so you can drive around the block to access the lot, then you have to stop and make a U-turn at (long light) Stanford Ave to go back for the parking. Again, it’s a lousy situation.
The locations, parking, and store types have not been comparable.
4. The nail in the coffin: Stop blaming the demise of JJ&F on the development. That was not what drove them under. Right before they left one of the family members told me that the day Trader Joe’s opened at Town and Country JJ&F lost 350 sales. The very first day. And it only got worse from there. I am thrilled that the owners of this new store have done so well competing with Trader Joe’s in San Jose. But it didn’t work for a beloved 65-year-old market in Palo Alto and they weren’t even in the same shopping center. How many days can they afford to lose 350 sales per day?
They’re doomed. That is all.
I agree with many of the comments preceding.
The design of the space within the overall development will make success very challenging. There are few success stories for grocery stores that have problematic parking. Not many are successful that are not stand alone.
@ Allison – “Palo Alto needs a market that specializes in Asian food.” Really?
Sounds like a self-serving comment that should actually read – “Allison likes Asian food”
Where I do agree is that any new grocery store should offer something unique
No one forced the developer to keep applying for years to blow the existing zoning out of the water. In the end, the only thing he could pretend to offer
was to include a new space for the existing market, JJ&F, to relocate to. Unfortunately too many people took him at his word and pressured the council to approve this development thinking JJ&F would return, although behind the scenes the developer was making sure the cost to JJ&F to do so would be prohibitive.
Unfortunately for the developer the council called his bluff realizing there was a strong likelihood that his promises to include JJ&F ion his development were likely meaningless without stiff penalties for violating this condition on which the entire development was approved.
Too bad since if the council had kept the existing neighborhood commercial zoning which allowed 25K sq ft. of development there was a bonus of an additional 25K sq ft for housing.
“Is it too sarcastic to open a pool on when this new store closes and the city clowncil mandates another failure. Can we mandate that all the local citizens that forced this to happen have to show receipts that they have spent a minimum of $50 per week at this store or we fine them?”
How about billing it back to Yelp and its ceo? You may recall Stoppelmann insisted om building its HQ in Palo Alto and lobbied long and hard for that site. Then when news broke about how badly he was underpaying his workers, he threw a hissy and left. He fired the young woman who went public with the news about how little they were paid. It made the news for about 3 embarrassing weeks, leading him to form the YUMBY party.
Look it up. And let our “planners” be wary the next time some highly paid CEO demands big concessions and tax breaks while creating an under-class of poorly paid employees, gig workers and contractors.
Some of these folks seem to suggest that the city has been unreasonable with the landlord. I don’t think so.
A bit of history.
The city has an ordinance that allows builders to create a “planned community” that offers a benefit to the community and thereby exempts the developers from zoning. In order to get this, developers propose things that may or may not be practical but their purpose is to be able to build a large building.
We have 3 developments in Palo Alto that were created with the promise to provide a grocery store. All 3 have had problems keeping a tenant in place.
The college terrace development is probably the worst one and has had 3 tenants and still counting. It really never had a chance.
The developer is on the hook until they either find a tenant that can figure out how to succeed, or to find a way to convince the city to allow the developer to escape from the commitments they made.
The city is of course to blame for having such a ridiculous ordinance that does little but create “benefits” that often don’t pan out. But the developer gets the majority of the blame for coming up with the plans in the first place.
Hopefully we have all learned that if the “benefit” is a local grocery store, it is likely to have problems.
@1drin …. there is a large Asian population in P.A. in case you are unaware. I could imagine an Asian market might be successful at the location, but it would be a big stretch as there is no parking and the footprint of the store is too small for a market to succeed given the small profit margins in the grocery business. It’s why JJ&F had to shut down. I’m close friends with one of the Garcia family and know this to be true. Bottom line is that it is a bad location for a market of any kind. College Terrace residents need to give it up. Keep buying your groceries wherever you’ve been buying them and stop whining about not having a market you won’t support.
@ Lee Forest … “A good point but most savvy shoppers tend to be on the frugal side” Agreed. Then stop whining about not having a market within 3 blocks of where you live. These complainers know they won’t shop there for most of their groceries. Mollie Stones, Grocery Outlet, Trader Joe’s and Safeway are all close by. Get over it already. Let the property owner move on without financial penalties.
Signage Signage Signage
Let’s make sure that the new store accepts the Federally backed EBT (electronic benefit transaction) formally known at Food Stamps. The building houses low-income residents, is in the Stanford / California Ave area. Make it possible for everyone to purchase healthy groceries there .
Neighbors want the market to succeed. I hope that the landlord, Oberman, will do everything to support his new tenant. Once approved, by the council, the new tenant will have to do a MAJOR marketing push to publicize their presence. I am hearing that Stanford is discussing whether or not to allow students to return in winter. Perhaps they will return in spring. The good news is that this tenant has a strong track record in Almaden. We in College Terrace will appreciate having a market on the west side of El Camino Real. I would have preferred that the market be on the former JJ & F site (College Avenue). Once approval is granted then SIGNAGE needs to be approved PRONTO. It was an abominable situation with scaffolding and netting for over six months suffocating the former tenant’s ability to conduct business. Again, my opinion is that hopefully the landlord will DO everything to support this new tenant.
“What Will They Do Next,…savvy shoppers tend to be on the frugal side”
Many other Palo Alto shoppers want quality, organic, healthy choices. You get what you pay for and organic, unprocessed, fresh food is worth the extra money. What you put into your body should be important to everyone!
>”Many other Palo Alto shoppers want quality, organic, healthy choices. You get what you pay for and organic, unprocessed, fresh food is worth the extra money. “
^ Some vendors in the food distribution system are trying to pass off conventional food products as organic as a way to make more money…the USDA Organic label is the only one that’s federally certified.
So unless you can actually trace it’s origins, how does one really know if something is ‘organic’?
Best bet is to ‘grow your own’ rather than to rely on any hype…whether at a grocery store or at the farmer’s market.