CVS Says No To Downtown Site, Causing New Delay For Village Marketplace

CVS has decided not to become the anchor tenant of the proposed Village Marketplace, developer David Irmer told Patch Monday.

Irmer has been trying for years to put a new retail certer on the site of the old Lucky grocery store. It is now a parking lot opposite Pelton Center.

Fresh & Easy, a grocery chain founded by the British corporation, Tesco, had been Irmer's original anchor tenant. But Tesco announced late last year that it may pull the Fresh & Easy chain out of the U.S. market.

Irmer then tried to convince CVS to relocate to Village Marketplace and shut its two current downtown stores -- the one next to Safeway and the other at the corner of Callan Avenue and East 14th Street.

But on Monday CVS senior management decided that the Village Marketplace site did not have enough parking. Nor could it easily accommodate a drive-through lane, a must-have feature for new pharmacy buildings, Irmer said.

Irmer still has four tenants for the new development: Peet's, Chipotle, a repositioned AT&T phone store and Habitat Burger, a chain out of Southern California.

But Irmer said he can't proceed without a tenant for the largest building, and the longer things gets delayed the more likely other tenants could pull out.

Irmer said Peet's is particularly anxious to come into San Leandro and could look for a different site if Village Marketplace remains stalled.

He faces another deadline. Irmer is supposed to buy the property from the city of San Leandro by June 14. Unless he builds a retail center there within an agreed upon time the city has a "right of reverter" that allows it to take back the land -- and keep the money.

This makes it risky for Irmer to buy the property on the speculation that he will eventually find an anchor tenant, and would also prevent him from buying the property, leaving it unimproved and flipping it later.

Irmer said he and his associates will start looking for a new tenant -- a well-known brand that could profitably use the 15,000 square foot building envisioned in his plans.

He has a lot riding on the outcome.

Irmer told Patch in January that he has spent in excess of $600,000 so far on studies, architectual plans and other paperwork to pave the way for the development.

The loss of CVS as a Village Marketplace tenant will have other ripple effects on the downtown, Irmer said.

He said Safeway wants to expand into the adjacent CVS location.

And had CVS closed its Dutton/Callan CVS store, Irmer said he had wanted to buy that property and put in a mixed use retail and residential development.

Read more about Village Marketplace in the Patch archives.

What do you think should go into Village Marketplace (recalling that Trader Joe's has turned down San Leandro more than once)?