Safeway to renovate Moon Valley store in Phoenix

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Safeway to renovate Moon Valley store in Phoenix

Post by arizonaguy »

Safeway is finally going to remodel it's most unique store in the Phoenix area to a lifestyle store. This store was built as an Alpha Beta which opened in 1976 and was purchased by Safeway in 2001. Safeway performed a very minor remodel on this store when it was purchased in 2001 (basically updated the department signage to the pre-lifestyle format) but then has essentially left it untouched. The store still has several Hussmann display cases that appear to be original to its opening in 1976 and a customer service "window" as opposed to a customer service desk. Due to a complete lack of investment by Safeway into this store I figured that with Cerberus / Albertsons ownership, the store was destined for closure, especially with a recently renovated lifestyle Safeway exactly 2 miles north of this store. However, in April Safeway signed a new 20 year lease for this store and is investing "several million" dollars in renovating it.

I believe this is Safeway's first major investment in a store in Arizona (either as a new store opening or major renovation) since 2011 and is the first major renovation of an Albertsons / Safeway store in Arizona since the merger.

Work is confined to the exterior now, here's a shot I got of it this morning:

Image

Here's the eventual planned facade of the store:

Image

For reference, the exterior used to look like:

Image
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Re: Safeway to renovate Moon Valley store in Phoenix

Post by storewanderer »

They are also installing a covered parking lot on the store at East? Glendale Ave. in Phoenix. No Frys for 2-2.5 miles in any direction so it seems to be a good location for them. The nearby Sprouts (featuring a Lucky trapezoid sign) is so popular the parking lot is over capacity. Actually I think a well priced Safeway with the better quality Albertsons perimeter and deep Albertsons center store/drug mix could be a real threat to Frys. They appear to be part of the way there...
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Re: Safeway to renovate Moon Valley store in Phoenix

Post by arizonaguy »

storewanderer wrote:They are also installing a covered parking lot on the store at East? Glendale Ave. in Phoenix. No Frys for 2-2.5 miles in any direction so it seems to be a good location for them. The nearby Sprouts (featuring a Lucky trapezoid sign) is so popular the parking lot is over capacity. Actually I think a well priced Safeway with the better quality Albertsons perimeter and deep Albertsons center store/drug mix could be a real threat to Frys. They appear to be part of the way there...
The post merger Albertsons/Safeway actually seems pretty bullish on the Phoenix market. I know about 1 - 2 years ago we were predicting mass store closures with either the standalone Safeway and or the Cerberus owned Alberstons / Safeway and as of yet that hasn't happened and instead they're investing in some of the stores that Safeway had previously neglected.

A well executed Safeway definitely can be competitive against Fry's. Especially the non "signature" Fry's stores. Albertsons / Safeway has a very nice and diverse store base to work with in the Phoenix market. The regular Fry's or Fry's Marketplace store seems positioned to go after one demographic of shopper, and that's the Walmart shopper. Kroger has positioned Fry's to compete with Walmart. It's worked so far, as the other traditional operators in Phoenix have either been broke (Bashas'), clueless (Safeway), or in a holding pattern (Albertsons) so really Walmart is all Kroger has had to deal with.

That former Lucky turned Sprouts was actually a higher volume Bashas' store. However, due to the fact that Bashas' is broke they couldn't afford to renew the lease (as the landlord increased the rent) so it became a Sprouts.
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Re: Safeway to renovate Moon Valley store in Phoenix

Post by pseudo3d »

The fact that they are renovating this store as a Safeway may mean something, as it may be the beginning of the Albertsons stores in the area being rebranded. Then again, Southwest was arguably the most successful of the LLC divisions, which may mean the Albertsons brand is stronger than previously thought. Maybe it's too early to discuss mass-market rebrandings, even though it may be closer than we think.
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Re: Safeway to renovate Moon Valley store in Phoenix

Post by storewanderer »

They have installed Albertsons programs in the AZ Safeway bakery, deli, meat, and produce areas. All they need to do at this point is reset center store to Albertsons specs (Albertsons AZ has a much, much larger center store mix than AZ Safeway both on food and especially on drug) and the AZ Safeways have been converted to Albertsons in all but name.

Those AZ/NM Albertsons LLC Stores were/are good stores. Good quality, good prices, and good execution. I think the Albertsons brand is stronger than previously thought also, in the markets where Cerberus was running the stores all along. I'm not so sure how much strength the Albertsons brand has in the former Supervalu markets... though I do think its reputation in SoCal is okay. I don't think Albertsons reputation in OR/WA is good at all and I would rebrand those to Safeway and just be done with it. However in the southwest, and in Colorado, Safeway is damaged goods; reputation for poor service and high prices is there and it is not getting any better with time despite slogans like "it's just better" and "3's a crowd" being thrown around.
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Re: Safeway to renovate Moon Valley store in Phoenix

Post by pseudo3d »

Kroger knows not to operate multiple brands in a single market (I don't think there are any City Market stores in greater Denver for instance), and I think that Albertsons should do the same.

I don't have numbers on if the SW division really was the best, but considering the fate of the others...

Northern California: Sold to Save Mart almost immediately, including DC
Florida: Most stores sold to Publix, DC sold, division shut down
Dallas/Fort Worth: All Texas stores south of Dallas/Fort Worth shuttered, remaining areas dramatically cut back, DC sold
Rocky Mountain: DC sold or closed (not sure), numerous stores closed

Southwest keeping its DC, most stores, and even adding a few Raleys seems like a good sign.

I've thought that Safeway should be the "West Coast" brand (except for SoCal, maybe call the mid-line normal stores "Vons Albertsons") and Albertsons be the brand for everything until Texas. A helpful side effect would be helping the dissociate a certain Safeway from where a certain tragedy occurred in January 2011.
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Re: Safeway to renovate Moon Valley store in Phoenix

Post by jamcool »

Safeway has been in AZ since the 1920s (when it was known as Pay N Takit)...Albertsons has only been here since 1990. Safeway does well here because they are often the only big store in the small AZ towns where Walmart won't go into because of size. Which means the Albertsons name will probably go away in a few years
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Re: Safeway to renovate Moon Valley store in Phoenix

Post by pseudo3d »

jamcool wrote:Safeway has been in AZ since the 1920s (when it was known as Pay N Takit)...Albertsons has only been here since 1990. Safeway does well here because they are often the only big store in the small AZ towns where Walmart won't go into because of size. Which means the Albertsons name will probably go away in a few years
Safeway may end up keeping the name in smaller markets, just as City Market can be found in smaller towns but not Denver. Furthermore, just because Safeway has been there longer doesn't mean the Albertsons name needs to go away...and unlike, say, Tom Thumb in Dallas, it doesn't have truly local roots.
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Re: Safeway to renovate Moon Valley store in Phoenix

Post by klkla »

pseudo3d wrote:Kroger knows not to operate multiple brands in a single market.
With two notable exceptions:

Southern California: Ralphs / Food4Less
Washington State: QFC / Fred Meyer
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Re: Safeway to renovate Moon Valley store in Phoenix

Post by arizonaguy »

pseudo3d wrote:
jamcool wrote:Safeway has been in AZ since the 1920s (when it was known as Pay N Takit)...Albertsons has only been here since 1990. Safeway does well here because they are often the only big store in the small AZ towns where Walmart won't go into because of size. Which means the Albertsons name will probably go away in a few years
Safeway may end up keeping the name in smaller markets, just as City Market can be found in smaller towns but not Denver. Furthermore, just because Safeway has been there longer doesn't mean the Albertsons name needs to go away...and unlike, say, Tom Thumb in Dallas, it doesn't have truly local roots.
I honestly don't see the Albertsons name surviving in Arizona.

There are 34 stores operating in the state under the Albertsons banner and approximately 109 operating under the Safeway banner.

Over the next couple of years, at last 6-7 more stores will be closed as there are several locations where an Albertsons / Safeway are across the street from one another or within 1 mile of one another.

Unless they intend to differentiate their product mixes and format (which they appear to be doing exactly the opposite as the Safeway stores in Arizona are becoming Albertsons in all but name) it makes no sense to advertise and maintain 2 separate banners.

Furthermore, most of the Albertsons stores in Arizona are in need of significant capital. The renovations that were done (if the stores were renovated at all) were mainly to repaint some walls and move some pharmacies from the center of some stores to the perimeters. Other than that, the stores weren't touched. The floors and ceiling tiles at most Arizona Albertsons locations are in dire need of replacement. In addition, some locations operate multiple brands/models of shopping carts that are also severely worn out and need to be replaced.

Due to the need to extensively renovate almost all of the Arizona Albertsons stores, it would make sense that while the stores are undergoing renovations, they also become rebannered into Safeway stores (which aren't in need of capital) as the Safeway store in Arizona that was in need of renovations the most is the subject of this thread.
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