On Eve of City Hall Hearing, Z&L Announces Pending Sale of 555 Fulton, Site of Approved Trader Joe's in Hayes Valley

SAN FRANCISCO — In a breakthrough in the effort to get a neighborhood-serving grocery store at 555 Fulton Street in Hayes Valley, current owner Z&L Properties announced today that they are in contract to sell the property to a new buyer, who is reportedly eager to prepare the space for Trader Joe’s.

“We are encouraged by this progress toward delivering on the promise of a neighborhood-serving grocery store in Hayes Valley,” said District 5 Supervisor Dean Preston, who called for the hearing. “Having a new owner enthusiastic about bringing in Trader Joe’s is a major step forward.”

In 2015, developer Z&L Properties purchased the site at 555 Fulton and, after a period of delays, constructed 139 housing units, with a 16,686 square-foot ground floor retail space. There were a series of starts and stops in getting a neighborhood-serving grocer into the ground floor, which stretched all the way to July 2021, when the Planning Commission conditionally authorized Trader Joe’s to operate in the retail space.

At the time, public statements indicated that Trader Joe’s would be opening in late 2022 or early 2023. Earlier this year, with no tangible progress, Supervisor Preston on February 14th called for a hearing at City Hall. Over the past month, Supervisor Preston has met with representatives from both Z&L and Trader Joe’s, as well as the buyer.

Earlier today, Z&L issued the following statement: “Z&L Properties is now in contract to sell the 555 Fulton Street property to a buyer who, once the deal is finalized, will assume the obligations of the lease and has assured us that they are eager to take the necessary steps to bring in Trader Joe’s as soon as possible. The transaction is not yet complete, as the buyer is conducting due diligence, and in accordance with the buyer’s request, we are not revealing their identity at this time. But we can say with confidence that they have expressed a strong desire to move in Trader Joe’s as soon as possible, and this is specifically a condition of the sale. We expect that the due diligence will require another month.”

Trader Joe’s provided the following statement: “Trader Joe’s remains eager to open a neighborhood grocery store serving the Hayes Valley community.”

The potential buyer asked that their identity not be revealed until the deal closes.

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