After 10 years of effort, Fremont will get its first Whole Foods, the high-end grocery chain announced Wednesday -- a major coup for the city and the latest salvo in the Bay Area's growing grocery battle.

Whole Foods plans to open its store at the northwest corner of Paseo Padre Parkway and Mowry Avenue on what is now a vacant lot, according to city officials and local real estate agents.

"Fremont has been trying to get Whole Foods for a decade," said Lori Taylor, the city's economic development director. "This is great."

The store, which would be 38,000 square feet in size, would have about 200 workers, said Adam Smith, executive coordinator of store development with Whole Foods. Construction should begin by late 2012, with the store likely to open in 2013.

"Fremont is definitely an area we want to get into," Smith said.

Whole Foods was one of two chains to announce a move into the city Wednesday. Sunflower Farmers Market, a natural and organic foods chain, also disclosed plans to come to Fremont, taking over a vacant Barnes & Noble store. The two stores will be about four blocks from each other.

Whole Foods disclosed the news in its quarterly earnings report, in which the chain announced eight new stores. The only other California store is in Newport Beach.

"We have been working with Whole Foods for a long time," Taylor said. "They have been looking for the right site and the right deal."


Advertisement

The arrival of Whole Foods also intensifies the growing competition for Bay Area shoppers, as chains like Safeway, Lucky's, Whole Foods, Fresh & Easy, Sprouts Farmers Market, FoodsCo. and Sunflower battle for customers.

"There is a big-time grocery war going on right now," said Damon Scholl, a broker with Cornish & Carey in Santa Clara.

Fresh & Easy has been adding a number of stores throughout the region, and Safeway is planning to build or revamp at least a half-dozen stores in the Bay Area.

Whole Foods has 26 stores in the Bay Area, including five in the East Bay and six in the South Bay.

"The Fremont deal is a sign that Whole Foods is serious about the Bay Area and serious about their expansion plans," said Robert Reynolds, an analyst with Moraga-based Reynolds Economics.

A few months ago, the chain opened its first San Jose store in the southern part of that city. The retailer also recently opened a store in Lafayette.

"Fremont fills in a very important gap for Whole Foods," Reynolds said.

In its earnings report, Whole Foods reported that its profits jumped 35 percent and its same-store sales rose 8.4 percent.

"We are continuing to gain market share at a faster rate than most public food retailers," Walter Robb, co-chief executive officer, said in a prepared release.

"Whole Foods will only go into areas that have high demographics," Scholl said. "Fremont has been doing a really good job with the Pacific Commons project. And to bring in a major retailer like this will add even more serious credibility to Fremont."

Sunflower agreed to lease 24,000 square feet at the corner of Fremont Boulevard and Mowry Avenue, said Terranomics realty brokers Patrick McGaughey and James Chung.

"This is crossroads retail for Fremont," McGaughey said. "It's an outstanding location."

And this won't be the end of the local growth efforts for Sunflower, which touts its "serious food at silly prices."

"Sunflower is expanding throughout the Bay Area and Northern California," McGaughey said.

About 100 jobs will be created when the new Sunflower store opens in 2012, estimated Chris Sherrell, the grocer's chief executive officer.

"We're excited to bring a fresh choice to the area," Sherrell said.

Contact George Avalos at 925-977-8477. Follow him at twitter.com/george_avalos.