SACRAMENTO, CA - Walmart would rather pay rent on its former store in Southgate Plaza to keep it empty than allow a potential competitor to take over the lease.
Walmart moved one mile east to the new Florin Towne Center in 2009, leaving behind a 135,000 square foot shell in the Southgate Plaza, which went into foreclosure the following year.
Southgate's new owner spent a reported $2 million to spruce up the aging shopping center and has enjoyed recent success in finding smaller tenants.
The crowning achievement appeared to be recent interest from a single retailer to take over the former Walmart site, which makes up one-third of Southgate Plaza.
Walmart, which has another 14 years left on its Southgate lease, rejected the offer last month.
"They felt the competition would hurt their supercenter down the street," said Chris Porter, the on-site representative for NewMark Merrill Companies, which manages Southgate Plaza.
NewMark Merrill would not identify the prospective tenant, but president and CEO Sandy Sigal said it was a regional retailer which he didn't see as a threat to Walmart.
"They have a different opinion of what is a direct competitor," Sigal said.
Porter says the vacant storefront and hundreds of empty parking spaces hurts the center's image and the lack of foot traffic drawn to an anchor tenant hurts neighboring tenants.
Larry Carr, the executive director of the Florin Road Partnership, which represents 420 businesses along Florin Road, said he was disappointed in Walmart's rejection of a new tenant.
"We expect Walmart to do what's in the best interest of Walmart," Carr said. "But we also have to look at what's in the best interest of the entire community."
When asked what kind of tenant would be acceptable to Walmart, spokeswoman Delia Garcia provided the following written statement:
We are encouraged by the recent successful leasing efforts at the Southgate Plaza shopping center and will continue to evaluate potential uses for the former Walmart building, ensuring that they complement the shopping center's offerings and support the success of area businesses.
by George Warren, GWarren@news10.net