Safeway Stores Inc. announced yesterday a $22 million expansion in metropolitan Washington that significantly includes three large new supermarkets in the District of Columbia and major expansions at four other city locations.
Included in the expansion program will be the largest Safeway on the East Coast - a 17,000-square-foot expansion of the current store at 415 14th St. SE, bringing total retail space there to 46,000 square feet.
The store at 14th Street and Kentucky Avenue, as well as a proposed new store north of Georgetown and a unit being constructed on University Drive in Fairfax all will be designated by Safeway is "super stores" - a name selected for combination food and general merchandise stores upon which Safeway is building a nation-wide expansion program.
Safeway, which has been in the food retail business here since 1926, is the nation's largest food chain. Giant Food Inc., a regional chain which was founded here in 1936, has increased its base of business over the years to the point where its share of area food sales is nearly equal to that of Safeway, despite fewer stores.
The decision by Safeway to expand here was seen as an attempt to retain its position as the largest food retailer here. Industry sources estimate that Safeway now accounts for 33 percent of area grocery sales, with Giant close behind at 30 percent. The Great Atlantic & Pacific Tea Co. is third in area sales, with about 9 percent.
In the District, Safeway long has been the dominant food retailer, although the firm and its competitors have closed many stores in recent years because, according to company officials, they were too small to generate a profitable business.
Currently, the Oakland, Calif-based company has 34 D.C. stores, including four outlets called Townhouses that feature specialty foods and somewhat higher prices. A decade ago, Safeway operated 71 stores in the city.
According to Ernest Moore, a spokesman for the Safeway division here, the company's expansion plans for the city will cost $8.7 million. In addition, real property taxes paid to the city will increase $75,000 a year to an annual level of $216,000 and employement will be increased by more than 125.
In the suburbs, Safeway will spend an additional $14.8 million for new or expanded stores that will add another 650 persons to the company's payroll. The entire building program is scheduled to be completed within 18 months.
Safeway's expansion and remodeling program in the city, announced at a news conference, include the following locations:
A new, 31,000-square-foot store at the Waterside Mall in Southwest Washington, which will replace a smaller mall store opened in 1960 and expanded in 1975. The store, to be built on M Street, will be part of an expanded retail mal that has suffered from a lack of business during subway construction since 1973.
a 44,000-square-foot store at 1855 Wisconsin Ave. NW near Georgetown, to replace an existing 27,000-square-foot unit that will be razed after the new store in completed. Employment will be increased by 31 to 130 at the store, which has received zoning approval but is being challenged in court by local citizens.
a 35,000-square-foot store at 42nd and Ellicott Streets, NW, also to replace a smaller store (15,000 square feet) that will be open until the new store is built. Construction is scheduled to begin this summer with completion planned by next January.
The major addition to an existing store at 14th Street and Kentucky Avenue SE, with construction scheduled to begin in November. Close to 40 new employes will be hired for the store.
"Wall-to-wall" renovations of existing stores at 3rd Street and Rhode Island Avenue NW and 5545 Connecticut Ave. NW, to be started next month.
An addition of 5,500 square feet to an existing store at 17th and Corcoran Street NW, which will increase employment by 25 persons.
When the expanded store in Southeast Washington is opened, next May, a 9,500-square-foot unit at 522 7th St. SE - some seven blocks away - will be closed. Moore also revealed that Safeway plans to close its unprofitable Townhouse in the L'Enfant Plaza shopping center.
Overall, the construction will add more than 50,000 square feet of new grocery retail business in the city.
Giant, which now has seven D.C. stores, is planning to operate a new store in the O Street Market, under an experimental joint ownership arrangement with citizens groups in the Shaw area and the D.C. Development Corp.
In addition, Safeway, Giant, A&P and other food retailers have been holding periodic talks with D.C. government officials about other possible locations in the city. Herman Neugass, a city economic development official, said yesterday that he had talks with A&P representatives last week and he forecast an expansion of supermarkets on Benning Road NE in the near future.