If Dominick’s Is Out, Who’s Moving In?

Real Estate Appraiser with PahRoo Appraisal & Consultancy

One of Chicagland’s most well known grocers, Dominick’s, is in its final 2 weeks of existence.  This begs the question, who will take over these stores?

For many of the Dominick’s location it is more than just a grocer, it is “anchor tenant” for many of the real estate centers that house it.  This is a problem for many of the businesses attached to or surrounding those locations as they rely heavily on the traffic to provide additional business.  Additionally, many of these grocery-anchored shopping centers have tenancy and co-tenancy clauses that stipulate smaller retailers may break their lease if an anchor tenant goes dark (industry terminology for going out of business).

Another effect of this mass exodus of 72 Dominick’s locations is the displacing of other tenants within the store itself, mainly Starbucks and JP Morgan Chase.  Chase bank has branches in 53 of Dominick’s locations.  This creates a challenge not only of not having a guaranteed lease with a new grocer or tenant, but also putting many jobs in jeopardy.

Some see this as a reason to panic; others see opportunity, conceivably, for other grocery chains to expand. 

Among one of the newest popular grocers, Mariano’s, owned by the larger group Roundy’s announced in early December 2013 that they would take over 11 of the Dominick’s locations.

Centrella Foods, which represents over 150 grocers, announced their intent to take over a group of locations as well, as many as ten.  Some familiar local grocers that are part of the Centrella group and looking to seize this opportunity to expand are Central Foods, Tony’s Finer Foods, Strack & Van Til, and Treasure Island.

The negotiations for Centrella with Dominick’s are being headed by David Schoeder, an investment banker specializing in the food industry.

One might ask where is Jewel-Osco?  Well, they have already taken over 4 locations that are currently still operating as Dominick’s.  Those locations will begin to convert in January 2014.

 As far as acquiring more, Allison Sperling, a spokesperson for Jewel-Osco said, their plans are on hold, and will wait to see what is left over after the massive scavenger hunt about to take place. 

She did however say “In the near future, we will consider any opportunities that arise.”

It sounds like Jewel-Osco is waiting to see who is going to identify themselves and emerge as the next major competitor in the market and adjust their game plan accordingly.


I got $50 on Treasure Island… any takers?


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