Gilroy
– The city’s commercial explosion around Pacheco Pass may cool
off a bit as an assortment of restaurants and stores claim the last
few spots in a million square feet of retail space.
Gilroy – The city’s commercial explosion around Pacheco Pass may cool off a bit as an assortment of restaurants and stores claim the last few spots in a million square feet of retail space. But that doesn’t spell the end of Gilroy’s economic growth, according to some officials. With the right market conditions, they predict the city’s commercial expansion will combine with new corporate and industrial uses to create a self-contained city, one that offers people of all income levels a place to live, shop, work, and advance.
The city has already doled out nearly all of its existing retail space in Pacheco Pass and Gilroy Crossing, the shopping centers that stand on the north and south sides of Route 152. In the next two years, five new businesses will open up in Gilroy Crossing, including two restaurants and Sugarland, a music chain-store.
To the north, Chuck E. Cheese will hold its grand opening on Thursday in the Pacheco Pass shopping center, followed by Home Goods, Jack In The Box, and Old Navy. The Wal-Mart Supercenter, set to open in summer 2005, will eat up 220,000 square feet of space – one third of the land available for development in Pacheco Pass.
It is no accident that businesses have chosen Gilroy as their home, according to Sandy Tompkins, store manager at Kohl’s. The discount retail store opened in early October in Gilroy Crossing.
“I know that the CEO of Kohl’s personally chose this location based on the shopping center opportunities and the other retailers moving in,” Tompkins said. “You want good neighbors to attract people. The other thing is our proximity to the freeway.”
She also cited the city’s retail training program, which teaches students customer service and other skills essential to working retail, as one of several elements that make Gilroy “a very friendly business environment.”
Of the 475,000 square feet originally available in Gilroy Crossing, only 10,000 square feet designated for restaurant use is left, according to John Greenhut, the city’s deputy director of community development.
In Pacheco Pass, the city has already allocated two thirds of the 526,341 square feet of available space, he said, with the lion’s share going to Wal-Mart. The remaining 220,000 square feet will go to Chuck E. Cheese, Home Goods, Old Navy and a handful of other stores.
The era of big-box stores and major retailers began about four years ago with the opening of Home Depot and Staples, according to Bill Lindsteadt, executive director of the Economic Development Corporation. Those stores set off a chain reaction that led to the openings of Office Max and Petco, across the street on Murray Avenue, followed by the explosion of retail stores to the south.
The commitment of county monies to expand Route 152 convinced Costco and Lowe’s to set up stores in Pacheco Pass, according to Lindsteadt, who said the stores timed their Nov. 2002 grand openings to coincide with the unveiling of the intersection.
“When we opened that signal [on Route 152], they opened their doors,” he recalled.
Target, Best Buy, Barnes & Noble, and others followed suit in the last few years, helping to keep the city’s budget in the black during tough economic times.
Since Lindsteadt was hired to create the EDC in 1996, the city’s retail space has grown by 2.2 million square feet. Annual taxable retail sales have grown from $600-million to $1.1-billion, in 2003. Lindsteadt predicted that additional growth would drive sales figures closer to $1.3 billion for the current year.
While the city’s economy remains vibrant, the future of the man who started the upswing remains unclear. Lindsteadt has suffered a series of medical complications, including a heart attack, following a Dec. 16 hospitalization for an undisclosed health emergency. As of yesterday, he remained in the critical care unit at Salinas Memorial Hospital, according to Gilroy Chamber of Commerce President Susan Valenta, who has worked with Lindsteadt for the last eight years.
The EDC board expects to discuss at a Jan. 14 meeting how to run the non-profit in his absence, and prepare for the possibility of a potential early retirement. Lindsteadt had planned to retire at the end of 2005.
In the meantime, they credit Lindsteadt with laying the groundwork for the next big phase of development in Gilroy, which will involve a mix of commercial, industrial, and corporate development to the east of the Pacheco pass shopping centers. EDC board member Bill Rameil said retail stores and industrial buildings are slated for the Machado property, about 100 acres east of Pacheco Pass off Renz Lane. Meanwhile, the McCarthy Industrial Park, planned for development on the southern edge of Route 152 just west of Gilroy Foods, could draw industrial uses and corporate offices for high-tech companies and research and development.
An improved economy could help Gilroy lure the companies it needs to achieve it’s vision of a textured, self-sustaining economy, according to Rameil. Right now, the city is finding it hard to compete with rock-bottom office prices in Silicon Valley.
More than 6,000 residents now commute to jobs in San Jose and the San Francisco Bay area, according to figures from the EDC.
Rameil said the original intent of the McCarthy project was to attract “more of the middle- to high-income jobs like engineers, high tech, and management people, which means bringing companies down.”
If the economy improves and drives companies further south, it could spell a major transformation for the city, according to Valenta. She said the city would then have everything it needs to be self-sufficient – a variety of jobs appealing to all income levels, places to shop, and a community college and job training programs that offer the chance for career improvement.
“I would envision a well-balanced community,” Valenta said. “By providing a well-balanced number of jobs, people can enter the job market and continue to improve their skills in a locally-based job environment.”
What’s going in
Gilroyans will see nearly a dozen stores and restaurants open.
On the south side, in Gilroy Crossing shopping center:
• Johnny Carino’s, an Italian restaurant
• Mimi’s restaurant
• Panera Bread
• Sally’s Beauty Supply
• Sugarland, music store
On the north side, in Pacheco Pass shopping center:
• Chuck E. Cheese’s
• Home Goods, kitchen supply store
• Jack In The Box, gas station
• Old Navy
• Wal-Mart Supercenter
