When people caught wind last month that Wal-Mart Stores Inc. signed a lease to put a small grocery north of downtown Los Angeles near Chinatown, few were surprised by the instant opposition it drew.
More surprising, though, is how many local business groups came out in support of the store.
The Los Angeles Area Chamber of Commerce and the Asian Business Association both released public statements supporting the project, and members of the Los Angeles Chinatown Business Council and the Chinese Chamber of Commerce have expressed their support.
They say that Wal-Mart’s claim on space in Chinatown shouldn’t be an issue because the building has been zoned for use as a grocery store for more than 20 years. Business leaders are flummoxed about why labor activists would oppose a project that promises to bring 65 jobs to the area in a space that has sat vacant for decades.
Nicki Ung, executive director for the Chinese chamber, said the big-box retailer’s interest in Chinatown is a welcome investment.
“We have a lot of available space and unfortunately we just haven’t had a lot of major retailers wanting to invest in it,” Ung said. “A lot of our history is here, but we need to move toward modernizing with society. In order to survive, you have to grow.”
However, James Elmendorf, deputy director at labor advocacy group Los Angeles Alliance for a New Economy, said business organizations should be more concerned about Wal-Mart’s impact.
“It’s very detrimental to locally owned businesses that have been there for a long time and operate on pretty thin margins,” he said. “The idea of a major player coming in and undercutting them is worrisome, especially in a community that has no chain stores today.”
But attempting to banish Wal-Mart from the city when it has followed zoning rules could cause the business community harm, said Gary Toebben, president and chief executive of the L.A. chamber. He said the city’s reputation is on the line.
“It might be Wal-Mart today and one of any different thousand stores tomorrow,” he said. “If we start taking away entitlements that are already associated with a property, we run the risk of developing a reputation for being more unfriendly to business.”
Last week, LAANE organized a press conference at which Wal-Mart employees voiced their opposition to the new store and what they called the company’s legacy of low wages. The conference was the first of what activists say will be a series of actions against the Bentonville, Ark.-based retailer.
LAANE succeeded in keeping a Wal-Mart store out of Inglewood in 2004. Voters rejected a ballot measure that would have allowed the retailer to bypass environmental and land-use laws. But that battle was fought over the possibility of a 200,000-square-foot store. A Wal-Mart Neighborhood Market grocery usually requires 42,000 square feet, and the Chinatown Neighborhood Market is planned for 33,000 square feet.
The store is expected to open in coming months on the ground level of Grand Plaza Apartments, a 300-unit senior housing complex built in 1991. The project was originally subsidized by L.A.’s Community Redevelopment Agency and came with conditions including a job creation requirement.
Elmendorf said labor activists oppose the grocery because businesses on the property are required to create 150 on-site full-time jobs. Wal-Mart announced that the Chinatown Neighborhood Market will create only 65, not all of them full time. Five smaller business spaces on the property can contribute to the total.
But Toebben said creating so many jobs in such a small space, especially one zoned for a grocery, is unrealistic.
“I don’t know who wrote that for the CRA in the first place, but it’s a ridiculous requirement,” he said. “In fact, with that requirement, the space will probably sit empty till hell freezes over.”
Elmendorf acknowledged that current entitlements and the conditions attached to them may be outdated. An environmental impact report was done for the property in 1979 and it received entitlements in 1990.
“A lot of things have changed since 1990,” Elmendorf said. “We should ask the question of, do we in fact want a grocery store here at all? And if we do, we should make sure we get the right one.”
Business leaders said there are few places where a grocery store would be more welcome.
George Yu, executive director of the Los Angeles Chinatown Business Council, said many Chinatown residents now head to South Pasadena to buy groceries.
“When you go grocery shopping, especially on the weekend, you have to make a trip,” Yu said. “It’s a drain on our economy.”
Steven Restivo, a spokesman for Wal-Mart, said he anticipates the store will help bring more foot traffic to Chinatown and keep money in the local community.
“Local organizations have been clear about their thoughts on the need for development downtown, and how our store might be part of the solution moving forward,” Restivo said. “We think the store might actually serve as a magnet for business development, opposite of urban myth.”
