BY ELAINE GOODMAN
Daily Post Correspondent
Neighborhood residents are again rallying to preserve a grocery store in the Edgewood Shopping Center in Palo Alto.
As part of a 2012 agreement with Sand Hill Property Co. to redevelop the shopping center, the city required a 20,600-square-foot building at the site to be used as a grocery store for the life of the project.
But after paying hundreds of thousands of dollars in fines to the city for allowing the building to sit vacant, the developer took the city to court over the grocery-store requirement. The case has now made its way to the California Sixth District Court of Appeal.
The City Council discussed the case in a closed session on Monday (Aug. 12), but took no official action.
Edgewood Shopping Center, at Highway 101 and Embarcadero Road, currently has an operating grocery store, the Market at Edgewood, which opened in December 2017.
Although the market has been popular, “even popular stores face financial challenges in these times, and owner-run, community-oriented grocery stores are always particularly vulnerable,” neighborhood activist Jeff Levinsky said in an email sent to residents last week. The email was co-signed by Carla Carvalho and Lenore Cymes.
“If we want to ensure a grocery remains at Edgewood Plaza, the council must use the very best legal experts and file a forceful appeal,” wrote Levinsky, who urged residents to contact the council on the issue.
The grocery-store requirement arose from an agreement between the city and the developer that allowed the developer to include 10 housing units in the project in exchange for providing a grocery store.
Store sat empty for two years
The redeveloped Edgewood Shopping Center opened in 2013 with a Fresh Market grocery store as a tenant. But Fresh Market closed its Palo Alto store, along with its other California locations, on March 31, 2015. Fresh Market had a 10-year lease for the Edgewood building and kept paying rent, and Sand Hill Property let it sit empty for more than two years.
In ruling on the developer’s lawsuit over the requirement, Santa Clara County Superior Court Judge Peter Kirwan said in December 2017 that the city ordinance does not require the developer to ensure the continuous operation of a grocery store at the center. Attorneys for the developer had argued that the city required continued use of the building as a grocery store — not continued operation of a grocery store.
Kirwan also ordered the city to refund almost $250,000 in fines the developer had paid.
The city filed its appeal of the decision on Jan. 23. The city’s opening brief is due on Friday, according to the appellate court’s website.
Residents weigh in
The December 2017 court ruling was followed by a deluge of letters to the City Council in support of a grocery store at Edgewood Shopping Center — as well as maintaining the city’s ability to fine the developer if a grocery store is not operating there.
“According to the ruling there just has to be a space for a grocery store, but there doesn’t have to be a grocery story,” Cymes wrote at the time. “No matter how I twist it — what is the value of an empty grocery store?”
“It is a very valuable community asset and we risk losing it if Sand Hill has less incentive to maintain a grocery store at that location,” resident Robert Ruskin wrote.
In his email last week, Levinsky reiterated some of the concerns. The ruling, he said, “makes no sense and could well encourage more developer misbehavior.”
“The court’s ruling means we could once again have no grocery store at Edgewood Plaza, because the shopping center owners will have far less incentive to keep and subsidize a grocer if necessary,” he said. “Instead, we may hear that a grocery store no longer ‘pencils out’ and we’ll lose forever a major neighborhood resource.”