Competition, geography, demographics. It all adds up to an uphill battle on the supermarket front for Rahway.
Matthew Casey has been analyzing supermarket retail for more than 30 years. He helps open new grocery stores, analyzing either a geographic area, the best places to build a store, or exactly how much business a store might do.
I recently spoke with Casey of Rahway-based Matthew P. Casey and Associates for his thoughts on the feasibility of a supermarket or grocery store in downtown Rahway. A grocery store is always a frequent topic of discussion among readers.
The general rule of thumb for supermarket retail is 1 acre per 10,000 square feet of retail, and that includes parking and loading docks, according to Casey. For example, the Clark ShopRite is about 65,000 square feet. He analyzed both ShopRite sites in Clark and Woodbridge.
“Downtowns are dead, they have been for 20 years. Supermarkets have been moving out of downtown for years. They want Route 1 or St. Georges Avenue,” Casey said. “That’s where all the traffic is, where the retail is, where people are oriented,” he said. Unless it’s a site at a traffic light on Route 1 or on St Georges Avenue, Casey said he wouldn’t consider downtown Rahway — as much as he’d like to see it succeed.
“Retail orientation isn’t downtown Rahway. That’s not going to change with a supermarket,” Casey said. The best chance might be getting a small, 10,000-square-foot suprette yet that still would require an acre of land and there are very few lots that big near downtown. Most sites large enough for a decent-sized supermarket are slated, or already approved, for residential developments, like the 3.5-acre Center Circle property.
“I highly doubt you’d get any supermarket interest,” Casey said. Pathmark and A&P no longer exist and the demographics don’t point to a Whole Foods or Trader Joe’s. One possibility might be a Key Food, which tend to be independently owned and smaller. It doesn’t help that there are supermarkets in every direction from Rahway, with high-volume ShopRites in Linden, Clark and Woodbridge. Trader Joe’s in Westfield is the highest volume store not just in the state but the entire the East Coast.
It costs between $5 million and $10 million to open a contemporary supermarket. “No one is going to take a chance if they’re not sure they’re going to do well; it’s too risky a venture,” Casey said.
What might work is “nothing that I would call a supermarket,” Casey said. “A convenience store or suprette might work but it’s got to be well known,” he said. There’s not enough pedestrian traffic downtown but it’s also in the suburbs and there’s not enough vehicular traffic downtown or enough of a retail draw bringing people downtown. There’s no co-anchor like a Kohl’s or JC Penney, he added.
Even if a store were to open in Rahway, surrounding ShopRites “are not going to lay down and let you take their business,” Casey said. “There’s a lot more to it then just, there’s 10,000 people in a 3-mile radius and need a store. There are countless alternatives in every direction,” he said. “ShopRite doesn’t give up volume, they will fight tooth and nail, they will lower prices and do what have to do.
“It’s just that competition surrounding Rahway is way too strong. If you were to put a store in Rahway, there’s not enough traffic downtown to support a major supermarket,” Casey said.
“A small store in Rahway is not going to stop ‘Mrs. Smith’ from going to Aldi. It’s not going to stop her from going to a 100,000-square-foot ShopRite in Woodbridge if she thinks she can get the best price there. They have 60,000 products and a great bakery.” Building a 10,000-square-foot store is not a strong enough draw to keep consumers from going to the Woodbridge or Clark ShopRite.
A number of times during our conversation, Casey emphasized that he’d like to see a supermarket in Rahway but it’s just not realistic.
The former Pathmark on St. Georges Avenue, which recently got Planning Board approval for become a fitness center, is not a bad location for a supermarket, according to Casey. The adjacent retail with Home Depot across the street and Kmart as a co-anchor are helpful.
The problem in New Jersey for anyone but ShopRite is that ShopRite is so strong. “Stop & Shop is pretty strong but they struggle when they go head to head with ShopRite. You’ve got unique guys in Trader Joe’s, Wegman’s, but they’re not going to Rahway.”
There are a handful of independent stores and Foodtowns but none do the business of ShopRite, according to Casey. “The problem in New Jersey is if you’re not ShopRite, it’s a tough road to go down. It’s so strong, everyone goes to ShopRite. A lot of independents are afraid to open and go head to head. It’s sad for the consumer.”