Dive Brief:
- Gelson’s Markets has agreed to sell its location in Carlsbad, California, to Kroger-owned Ralphs, the Southern California specialty grocer announced in an emailed statement on Dec. 29. Terms of the deal were not disclosed.
- Ralphs is set to take over ownership and operations of the store on March 9.
- Gelson’s said it decided to sell the store after trying unsuccessfully to improve the unprofitable store’s financial performance.
Dive Insight:
Gelson’s described its decision to transfer its store in Carlsbad to Ralphs as a last resort, noting that it plans to keep investing in its business even as it sells the San Diego-area location.
“This store has faced ongoing financial challenges for several years, and despite continued efforts to improve performance, it remains unprofitable. After careful consideration, we made the difficult decision to sell the store,” Gelson’s said.
The company said that it will “continue normal operations” at its locations in Del Mar, California, and San Diego’s Pacific Beach neighborhood, both of which are located in the same vicinity as the Carlsbad store.
In addition, the chain, which runs 28 stores in the San Diego and Los Angeles metropolitan areas, said it is proceeding with plans to open a new, small format store in Toluca Lake, California. That location, which will span 10,000 square feet, is scheduled to begin operations at the end of January.
Gelson’s website indicates that the Carlsbad store, located at 7660 El Camino Real, will permanently close on Feb. 28.
Gelson’s suggested that at least some of the employees who work at the Carlsbad store will lose their jobs as a result of the sale. “We intentionally sought a buyer willing to retain as many team members as possible rather than pursuing a closure without transition opportunities,” the company said in the announcement, without elaborating.
