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Tiny Target store coming to South Park

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Indie die-hards in South Park are reeling from the news that mega-retailer Target plans to open a small-format store in the San Diego neighborhood next year.

Target jumped on the small-store bandwagon this July when it opened its first TargetExpress in Minneapolis, and on Monday said it plans to open its sixth TargetExpress store in South Park next July.

The store will replace the Gala Foods supermarket at Fern and Grape streets, distressing proponents of the historic community's local businesses. Gala Foods, which also owns the property, plans to close the grocery store around Nov. 1 and then lease the property to Target.

Some residents are outraged, but others, especially those critical of Gala's tired look and limited offerings, are encouraging their neighbors to withhold negative judgment.

"I've shopped at Gala at least once-a-week for the past 15 years," wrote Ronald Gee in the comments section of the original U-T San Diego story. "I'm very dismayed at this news. The last thing we need in our small little community is something like a Target."

"We need one in City Heights where the old Albertson's (sic) was or a Wal-mart neighborhood store," wrote Gary C. Hardin. "We would welcome that."

"I was hoping for a Trader Joes (sic), but at this point I would take anything over the over sized liquor store Gala," wrote Ed Nye.

Grant’s Marketplace owner Joe Grant said over the phone that he was “not happy about it at all.” His specialty grocery store with a deli is a few blocks from Gala Foods. Grant, who was born and raised in San Diego, said he sees the Target as a threat to local businesses.

The new TargetExpress store, at 19,000 square feet, will be about 14 percent the size of the typical Target store. It will carry a lot of smaller quantities of everyday consumables, such as paper products, grocery and pharmacy items, along with a small selection of basic clothes and home decor items.

Video tour of first TargetExpress store

Video tour of the first TargetExpress store.

Grant believes many of those offerings will duplicate what some shops in the community already carry, and potentially cannibalize their sales.

"The one thing that sounds a little tantalizing is the pharmacy," he said. "And maybe a little bank in there, because we don't have any local banks in the neighborhood."

For years, retailers took pride in ever-bigger stores, but now with the rise of Internet shopping and showrooming, the trend is reversing.

Walmart last year said it will focus expansion efforts on its smaller-format Neighborhood Markets and general merchandise stores, instead of its Supercenters.

The TargetExpress stores, which compete with Walmart's smaller stores and pharmacy chains like Walgreen's and CVS, are part of Target's effort to become a bigger part of urban city living.

Gala Foods owner Saad Hirmez, who took over the supermarket in 1988 after Safeway left, said he has been looking for a new tenant for quite a while. The Hirmez brothers are getting older, he explained, they've been in the grocery business for 46 years, and it was time to scale back.

Although the market was sustaining itself, he said the store needed between $3 million and $4 million in renovations to operate at the level the South Park community needs and deserves. The family-owned business just didn't have the energy or means to invest that into scaling up the operation.

He listed the property and had brokers approach chains such as Trader Joe's, Jimbo's and Sprouts, but none expressed interest in coming to South Park.

"Target will reinvest in this area and spend millions, and they'll be able to offer a lot more than we were able to, because we were scaling back" Hirmez said. "The community should be pleased. Now you don’t have to drive all the way to Mission Valley to pick up some of your necessities. From what we were offering the community and what they’re bringing to the table, it’s a win-win situation."

He said Target will not be tearing down the structure, but only renovating the interior.

Meanwhile, Hirmez is working with Target to keep some of the parking lot amenities residents have grown to depend on, like the recycling center, Mariscos food truck and drive-thru coffee shop. In the future, Hirmez hopes he is able to bring a bank onto the property as well.

"We are grateful for the South Park community," he said. "We made our livelihood from them, and it’s unfortunate that age has caught up with us and time has caught up with us, and we had to move on. It’s a magnificent, quaint community that is changing right before our eyes."

Grant said Target's arrival in the neighborhood could open the door to more chains to move in. The smaller shops will then have to compete harder for business, and likely face rising lease costs as they compete with national companies for storefronts.

"What’s happening is these big, big businesses want so much more of the market share that they’re going into communities like ours and setting up shop," he said. "That increases the lease amounts and rubs out the local character, watering it down with features and services that you can get in almost any neighborhood. That's the part that gets scary."

The "express" concept is new for Target, whose smallest format until recently was the CityTarget stores ranging between 80,000 and 125,000 square feet. The first TargetExpress opened in Target's hometown of Minneapolis in late July.