In today’s Chicago grocer market, that’s a bad combination, according to Scott Carr, executive vice president of portfolio management with Inland Real Estate Corporation.
Carr summed up the problems of Jewel-Osco well during the 11th annual Commercial Real Estate Forecast Conference held Jan. 22 by Illinois Real Estate Journal, Midwest Real Estate News and Chicago Industrial Properties.
Speaking during the conference’s retail-focused breakout session, Carr said that savvier competitors have steadily siphoned away Jewel-Osco’s previously unbeatable market share in the city and suburbs.
“Every Jewel-Osco store today is the same,” Carr told attendees. “Now you have niche players, local grocers, who provide a shopping experience. And you have Walmart and Target offering lower prices on grocery. Jewel is not price-competitive and it is not experience-competitive. That’s why it has fallen.”
Carr’s comments were timely. Jewel-Osco’s parent company Supervalu announced earlier this month that it will sell the grocery chain to a group of investors led by Cerberus Capital Management.
Supervalu has not been enjoying good times as of late. The company reported a los sof $1.04 billion for the 2012 fiscal year. Sales at Supervalu stores also fell 3 percent to $27.9 billion last fiscal year. The company also fired its chief executive officer, Craig Herkert.
What does the future hold for Jewel-Osco? That’s hard to say. Carr recounted the days when Chicago residents either shopped at Jewel or Dominicks. Those days are long gone. But Carr told conference attendees that he was excited about the future of the grocery business, no matter what happens with Jewel-Osco.
“I think that we are on the cusp of a boom in this business,” Carr said.
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