Whole Foods to relocate N. Austin store
Source: Austin Business Journal
Mary Alice Kaspar, Austin Business Journal Staff

Whole Foods (Nasdaq: WFMI), the world's largest natural and organic foods grocer, has secured 4 acres at the northeast corner of MoPac Expressway and Braker Lane that will enable it to double the size of its presence in North Austin -- from 35,000 to 70,000 square feet. The current store is in the Gateway Shopping Center at 9607 Research Blvd., near The Arboretum.

Jim Sud, the Whole Foods executive vice president who oversees growth and business development, says: "We've been looking for opportunities to expand or relocate our Gateway store -- to bring to the north side of Austin what we're doing downtown."

At Sixth Street and Lamar Boulevard, Whole Foods is building an 80,000-square-foot store and 200,000-square-foot corporate headquarters immediately south of its current flagship store downtown. The current store will be shut down.

He says Whole Foods plans to eventually close the Gateway store, which is tucked in among other retailers. The Braker site will allow more products, more parking and better visibility, Sud says.

Sud says the new store in North Austin is years away from opening. With six to seven years remaining on the Gateway lease and a time-consuming design and construction process on the horizon, the new store could open near the end of the decade, possibly sooner, he says.

Whole Foods secured the property at Braker and MoPac because it doesn't want to lose out on land in "what we think is going to be a major retail corridor for North Austin," Sud says.

That includes a nearby mixed-use project being developed at The Domain by Austin-based Endeavor Real Estate Group LLC and Indianapolis-based Simon Property Group Inc. [NYSE: SPG]. The two companies are planning 600,000 to 700,000 square feet of retail and 350 to 650 residential units at Braker Lane and Burnet Road.

Once the two relocations are completed, Whole Foods' Austin stores will be among the retailer's largest in the country, Sud says. A typical store ranges from 40,000 to 65,000 square feet.

"What we find is we're able to dedicate more space to what we do best: perishable items," Sud says.

That includes meat, seafood, produce, baked goods and prepared foods.

"By having the space to dedicate to those departments, we feel we're able to attract a larger customer base," Sud says. "As stores have grown across the country, we've found sales have disproportionally increased."

Boosting the size of stores in Austin will help Whole Foods compete with its biggest head-to-head rival in Austin -- Central Market, says Jack Plunkett, CEO of Houston-based market research firm Plunkett Research Ltd. His firm publishes the Plunkett Food Industry Almanac.

The upscale Central Market grocery stores are owned by San Antonio-based H.E. Butt Grocery Co. Its two Austin locations are about 70,000 square feet each.

Plunkett says Whole Foods and Central Market successfully cater to affluent shoppers, with Whole Foods historically cornering the "green" market, Plunkett says.

An HEB representative couldn't be reached for comment.

Email MARY ALICE KASPAR at (makaspar@bizjournals.com).

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