UPDATE: Regency Centers Tried To Modify Lease With Whole Foods To Save Jade Garden, But Whole Foods Wouldn’t Approve Changes

October 10, 2018 12:38 pm · 57 comments

As we previously reported, Jade Garden Chinese restaurant and the UPS store have been told to vacate the Encina Grande shopping center on Ygnacio Valley Rd. due to a restriction in the lease with Whole Foods that limits the square-footage of restaurants in the shopping center.

The lease, according to the center’s manager, Regency Centers, says the restaurant must leave the center once their current lease expires, and the space cannot be occupied by another restaurant.

AAA is planning to move into the space, which is why the UPS store is also being forced out. Regency Centers plans to combine the two units in order to make room for AAA.

Whole Foods signed the lease with Regency Centers before finally opening in 2016, however, Jade Garden was not told about the restriction in the lease until 12-months before they were told to vacate the center.

In a letter sent to the owners of Jade Garden from Regency Centers in February of 2018, it appears the center’s manager attempted to modify the language in the lease several years after it was signed by both parties, but the Amazon-owned supermarket chain wouldn’t approve the changes, according to Regency Centers.

Jade Garden and the UPS store must vacate the center in four months, by February of 2019.

It’s currently unknown if other restaurants will be told to leave once their lease expires.

image: courtesy of Janis Roberts

RELATED STORY: Jade Garden, UPS Store Being Forced Out Of The Encina Grande Shopping Center Due To Restriction In Whole Foods Lease

Mick Marin October 10, 2018 at 1:05 PM

It doesn’t matter if Regency Centers tried to modify the lease now… they signed it at the first place while Jade Garden was still there and they didn’t even bother to notify them…not to mention, Jade Garden has been in that location for years as a loyal tenant. Shame on Regency Centers. Even more shame on Wholefoods, GREED, GREED, GREED.

Want some won ton October 10, 2018 at 2:38 PM

^^this

Rebel October 10, 2018 at 1:10 PM

Time to boycott! They are out to destroy any and all compeition, including mom and pop stores. What a disgrace.

Regency Narc October 10, 2018 at 1:17 PM

So Regency is trying to dodge the bullet by sending this letter and placing full blame on Whole Foods despite the fact that both parties signed the contract. Not saying Whole Foods is in the right, but Regency is not blame free either despite “trying for months”… Just Saying

Blink October 10, 2018 at 1:59 PM

Good point

CalOldBlue October 10, 2018 at 1:26 PM

Here’s a fun read (snippets follow): https://www.wholefoodsmarket.com/company-info/real-estate
I especially like these: “Our newer stores are larger and offer a greater selection of products, but we continue to respect the neighborhood to which we are moving and strive to become an integral part of the community” and the requirements for getting one of their stores in your shopping center: “Abundant parking available for our exclusive use”. Now: regarding Amazon and Bezos… that deal closed at the end of August last year, so 13 months ago. The original agreement started before Amazon came into the picture, but they’ve inherited the deal. My OPINION (emphasis because I want to ensure we separate fact from opinion) is that Amazon and Bezos are not micro-managing where and how WF deploys their stores. I don’t know if they are even aware of this situation, and I SUSPECT they are not hands-on enough to want to step in, until or unless this becomes a political problem for them.

Dorothy October 10, 2018 at 1:27 PM

Big business tactic, get rid of the small ones nearby. That kind of non-competitive contracts should be illegal somehow. Star Bucks has that kind of wording in their contracts too.

MattfromConcord October 10, 2018 at 1:30 PM

Jennifer Hess – Regency Centers.
925-278-1885
(Its right there in the letter)
EVERYONE NEEDS TO CALL HER AND COMPLAIN
and
BOYCOTT WHOLEFOODS

The Troll’s wife October 10, 2018 at 5:09 PM

Whole Foods customer service number: 1-844-936-8255. Maybe if we all started calling them…

Kentucky Derby October 10, 2018 at 1:37 PM

I feel bad for Jade Garden, but this is the cost of doing business. Anyone who really understands business knows how cutthroat it can be. It’s not fair, but nobody ever said life was fair. Business is business.

Nopety Nope October 10, 2018 at 2:06 PM

That’s a lame excuse for being a really bad neighbor.

Ken October 10, 2018 at 2:24 PM

Business is business and if they are competing for everyone’s dollar, than fair is fair. Having a small business lose their lease because you have more money and clout is not business, it’s protectionism.

This is a bully trying to make themselves the only option.

Smith October 10, 2018 at 2:44 PM

That does not explain,however, why Rocco’s was able to expand, appears to be rejuvinated, and is thriving in the same shopping center.

Ricardoh October 10, 2018 at 1:52 PM

Whole foods is sort of a yuppie joint. Safeway and Costco have all I need.

Mr pink October 10, 2018 at 1:53 PM

Nice move, Whole Foods. Afraid of a little food competition from a family-owned restaurant that serves completely different food than you offer?

Living in Claycord October 10, 2018 at 4:32 PM

Think about what you just wrote. There is no competition to Whole Foods from a family run Chinese restaurant. There has to be another reason that Jade Garden was thrown under the bus. Regency wants to merge 2 spaces and put in AAA. Follow the money.

Sign from Above October 10, 2018 at 2:01 PM

I’d much rather sit down in a family restaurant and have a meal than to get my food from one of those nasty buffets in WF. Kids (and adults) coughing all over the food. People reaching in with bare hands and touching the food! Yum. With the exception of Rocco’s, which I’m sure will be next on their hit list, I have no intention of shopping in the strip mall. I put the blame on Regency Management. They are the pond scum here. Screw the community. All that’s important is the mighty buck! There is not a food establishment in the center that is small enough to survive the WF contract. Great job!

Jeffsterz October 10, 2018 at 11:40 PM

I like the Ace Hardware.

Cowellian October 10, 2018 at 2:11 PM

I don’t shop at whole foods, but I’m not willing to let Regency off the hook, either. The time to change the terms of an agreement is before each party puts ink on the paper. Regency is just trying to shield themselves from the inevitable blow-back.

Although this case is certainly stirring up a lot of interest due to the heavy-handed way that the smaller retailers are being treated, I suspect that this type of condition is very common in leases with major companies. Shopping Centers really want the big name companies and are willing to give them better terms than the smaller firms get.

Kentucky Derby October 10, 2018 at 2:19 PM

I totally agree. I think that’s exactly what happened.

Nopety Nope October 10, 2018 at 9:43 PM

And what happens when the big stores leave?

Collegecollage October 10, 2018 at 2:22 PM

My family only goes there for the mom and pop restuarants. That shopping center is going to go down. And since Amazon took over whole foods. Whole foods isnt as good. Shame on you Amazon, whole foods, regency!!!! Boo!!! Boo!!!

Ricardoh October 10, 2018 at 2:23 PM

I have been doing something dangerous. Thinking. I can see a pretty big lawsuit here against WF and the shopping center. They conspired to the detriment of another business.

Sign from Above October 10, 2018 at 3:14 PM

That’s exactly what they did!

Anon October 10, 2018 at 2:27 PM

I will say because I have first hand experience with Regency. They do not really give a crap about their tenants. It’s just business and about the money at the end of the day. They do not lose anything here. They get a more well known tenant with more than likely higher leases. I almost promise that they knew this was going to be an issue when they did the lease with WF but didn’t care about it and felt that it would be ok if they gave “reasonable” notice. Now this business has to endure the cost of a) relocation at a heavy expense or b) closing down outright as the costs of developing a new location in today’s market are sky high. Regency is really the one to blame here and they will get paid regardless. Shame.

MattfromConcord October 10, 2018 at 2:28 PM

Contact WHOLEFOODS too and let them know how the community feels about this.
Here’s the link to contact them.
https://m.wholefoodsmarket.com/content/customer-service

Cellophane October 10, 2018 at 2:36 PM

Hmm.

Restraint of fair trade?

I never have liked the Amazon way of doing business.

This is just another reason not to like them.

Matthew October 10, 2018 at 2:55 PM

Before you boycott, file your complaint with Whole Foods: email media@wholefoods.com and rapidresponse@wholefoods.com and call National at 1(512)477-5566.

Original G October 10, 2018 at 3:02 PM

Lets see how does that work . . . .
one who pays the most rent wins ? ? ?
And the three hundred pound gorilla gets what it demands.

Did regency read the contract or do they just not care ???

Original G October 10, 2018 at 3:03 PM

Disregard last sentence of previous post.

Sweets October 10, 2018 at 3:41 PM

This is all on Regency, not Whole Foods, Regency allowed the lease to include that language, they could of not signed with those terms if they valued their tenants, but obviously they do not, its only about money, which is fine by me, but I will join in boycotting of that entire shopping center and not give any of my business to any business in their shopping center. Not a fan of Whole Foods or Amazon anyways so no big loss for me.

Sign from Above October 11, 2018 at 7:29 AM

I agree. Except I don’t want to throw Rocco’s out of business because of the actions of the greedy management company. That would be contrary to the argument. I certainly won’t do business with WF!

Kdogg October 10, 2018 at 3:55 PM

Why don’t they get rid of crapplebees and let Jade Garden stay?

sideline October 10, 2018 at 4:02 PM

hold your horses, people.
Jade Garden has a lease.
It expires.
Both parties have the right to discontinue the lease. It goes both ways, people. Thats business.

Nopety Nope October 10, 2018 at 9:47 PM

And we have the right to be upset about losing one of the few non-chain restaurants we have left, one that’s been a part of the community for decades.

This country is losing all its color and texture as people lose sight of the little things that make life interesting.

Sign from Above October 11, 2018 at 7:16 AM

And, both WF and the Regency Management will have to withstand the blow back from the community (their customers). That too is business! This is a power grab fueled by greed, plain and simple.

Doh October 10, 2018 at 4:09 PM

I don’t know why WF would have that clause in their lease. We are going to lose Rico’s as well.

Sign from Above October 11, 2018 at 7:13 AM

If Rocco’s is pushed out, I have no reason at all to visit that center.

Atticus Thraxx October 10, 2018 at 4:57 PM

I took the liberty of looking up Jade Gardens on the CCC Food Facility Inspection list: https://tinyurl.com/yca9nppj
In the interest of fairness I also looked up Whole Foods: https://tinyurl.com/yca9nppj

chuckie the troll October 10, 2018 at 5:11 PM

What about Applebees? Will they be required to leave when their current lease expires? And is it possible that they were given a heads up and allowed to extend their lease? I suspect that their are enough nut cases and lawyers on Claycord to change someone’s mind.

PO'd October 10, 2018 at 5:57 PM

Any space across the street? Hopefully with a storefront that’s highly visible.

Notify October 10, 2018 at 6:21 PM

just had delicious burger at longtime favs Evies Hamburgers and they were told the same..

BuuBuusFriend October 10, 2018 at 7:59 PM

No-one else has mentioned this, but the food at that restaurant isn’t good. I got sick the two times I ate there. Yes, the one glass of cheap wine exacerbated getting sick, but the food was not fresh and tasty. As a daughter of a small-business person, and former wife of one, I am sorry to hear about the circumstances – but that IS business these days, and no lease is engraved in concrete for all time, I would think.

Mick October 11, 2018 at 3:49 PM

Sorry to hear that you haven’t had a good food there. My family and many other families we know have been getting food from this place over 20 years, we never, ever had any bad food issues. Perhaps there was a hiccup in their kitchen and you got it that day.

Walt October 10, 2018 at 9:36 PM

Whole Paycheck wants to force people to buy their overpriced food !!!

Anon October 11, 2018 at 6:55 AM

Just heard this on KCBS. They got it wrong, claiming that Whole Foods was going to move into the Jade Garden location.

ZZ October 11, 2018 at 7:01 AM

This doesn’t make sense. Maybe it will, once the other leases are up and we’ll see if they have to vacate.

Sign from Above October 11, 2018 at 7:09 AM

Ahhhh! After spending yesterday trying to pass the blame to WF and avoid the backlash of this by telling us how much they tried to change the mind of WF, today’s news tells us that Regency has released a new statement. Now they’re saying that the decision was completely theirs and WF had nothing to do with it. They were trying to make a decision in the best interest of the community! Bull!! They were working with WF to ensure that big space, and their bank account, was filled! Regency is pond scum! The city planning department should nix any request they put forward, as their interests are clearly not in the community’s best interest!

LOL October 11, 2018 at 7:53 AM

As noted by a smart person above: both parties signed the lease and leases expire. The money wins, and in this case it is Whole Foods.

JustMe October 11, 2018 at 8:09 AM

I don’t blame Amazon for this issue, they didn’t own Whole Foods until after it was already in the center. This deal apparently was negotiated by Whole Foods. I suspect there’s more to the story than we know…

That being said, there’s really no reason to modify a lease once it’s been set unless you want an extension or you’re getting a better deal. Sometimes it’s better to simply leave things alone. Why expend the energy on something if you don’t need to do so? I suspect that’s what’s happening here. I don’t think it’s nefarious. If Regency Centers was so concerned about the other tenants why did they even agree to such terms? I’ve seen such deals in the past, and they’re STUPID. Remember when Starbucks was going to open up inside Lucky’s store but couldn’t because the shopping center negotiated a deal– if I’m not mistaken, with then Lisa’s House of Hotdogs which was selling coffee in the center. They went so far as to have the Starbucks sign up, and setup the space, only to take down the sign and then convert the space for sushi.

Anyway, I personally dislike exclusivity clauses, but once a long term lease is setup, I don’t see any incentive to change it. I guess this is why you negotiate long term leases.

MattfromConcord October 11, 2018 at 8:53 AM

How many times in the last 31 years has their lease been up. All of those times the landlord said thanks your a great tenant we thank you for being here. Now after 31 years they see money and say too bad so sad now get out.

Tangent October 11, 2018 at 12:26 PM

I just sent out a tweet to @jeffbezos . You can too. Bypass these local managers. Let Bezos advise his people. He may not act…but then.no harm trying.

KRAMER, TIMOTHY October 11, 2018 at 2:08 PM

glad that whole foods doesn’t want to sell bicycles

The Mamba October 11, 2018 at 3:02 PM

Jade Garden sounds really good right now, as does dinner with the Fam at Rocco’s. Whole Foods, blech.

Linda October 11, 2018 at 10:55 PM

That is a total monopoly. The fact the Whole Foods can dominate an entire strip mall, to be the only food, is awful. They are driving small businesses to demise, makes it hard to swallow Whole Foods Foods!!

taco truck October 12, 2018 at 1:30 AM

This kind of crap happens all the time. It’s not fair to the little guy. For example big chain restaurant like Zachary’s Pizza got to dictate (with the city of Pleasant Hill & Off the grid) that no food truck can operate in or around downtown that does Pizza. Crazy….I thought this was a free & democratic country? Guess not

GHS3 October 12, 2018 at 3:58 PM

If you connect the dots, you may come to a possible conclusion that Regency is really covering for AAA. The WC Planning commission agenda (link below) has multiple attachments, one of which states that AAA is ‘losing’ their lease at the Regency managed location in downtown WC at Plaza Escuela. AAA’s stated plan is to move into shopping centers (e.g., Crossroads in Pleasant Hill, The Veranda in Concord). Regency gets to keep AAA as a client by not renewing two other tenant leases. My hunch is that Regency has been working closely with AAA since the beginning to find a suitable location.

http://walnutcreek.granicus.com/GeneratedAgendaViewer.php?view_id=12&event_id=1629

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