Haggen Food & Pharmacy Grocery store will open a location in Palmdale on Tuesday, the first of 25 Haggen stores that will open in the Los Angeles area by the end of this summer.
The Bellingham, Wash., grocery chain purchased 164 grocery stores in five western states from Albertsons and Safeway Inc., which agreed to sell off more than 250 stores to get federal approval for their $7.6 billion merger last year. That’s opened Southern California up to Haggen, which had until now operated primarily in Washington and Oregon.
Haggen officials said the converted Albertsons, Safeway, Vons and Pavilions stores will feature more fresh produce, higher quality meats and seafood. There also will be décor and design changes.
As Haggen moves in, El Segundo grocery chain Fresh & Easy is cutting back, announcing it will sell 50 of its 167 stores. Southern California locations account for 30 of the stores to be sold.
The move comes as the chain tries to develop more small convenience-type stores, ranging in size from 3,000 to 5,000 square feet. The company is working with ADMI Inc., a Morgan Hill company that assisted Apple Inc. in designing its retail stores, on the convenience concept.
The move was first announced in a video featuring Chief Executive Jim Keyes posted at the Fresh & Easy YouTube channel over the weekend. The video has since been removed.
“Instead of paying to keep stores open that are not ultimately part of the future, in places that we have little chance of profit, we think that we can turn that cash into investment in new stores,” Keyes said in the video, according to the Orange County Register.
Among the locations that will close are stores in Hermosa Beach, Long Beach, Pasadena, Harbor City and Arcadia.
Fresh & Easy opened its first stores in California in 2007 when owned by Tesco Plc, the giant U.K. grocer. The company entered a highly competitive grocery store market that included Ralphs, Vons and Walmart, as well as specialty chains such as Trades Joe’s of Monrovia.
Having struggled financially and filing for Chapter 11 bankruptcy protection, the chain was finally sold by Tesco in 2013 to Yucaipa Cos., the Los Angeles private investment firm owned by billionaire Ron Burkle.
Yucaipa’s acquisitions over the years have included the Food 4 Less, Alpha Beta, Ralphs and Great Atlantic & Pacific Tea Co. grocery chains.
