Nugget Markets pulls out of Truckee Railyard project | SierraSun.com

Nugget Markets pulls out of Truckee Railyard project

A decision by a grocery store chain to abandon plans for a location at the Railyard development on the east end of downtown Truckee won't knock the project off track.

Nugget Markets pulled out of the multimillion-dollar project after the Town of Truckee Council paved the way for a Raley's market to be built at Soaring Way and Highway 267. The Raley's would be located about three miles from downtown Truckee.

"It's unfortunate to lose a great tenant like Nugget," Railyard project manager Jason Hansford said Wednesday.

"Clearly, we think it's important to have a family, full-size grocery store in the downtown corridor in order to encourage people to come out and shop, and spread their wealth."

“There is not enough sales potential for grocery sales in Truckee for all the stores.” Doug Wiele, Foothill Partners president

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Nugget Markets was expected to occupy a 35,000-square-foot building on 3.2 acres within Railyard — a project spearheaded by Holliday Development of Oakland. A 7,483-square-foot patio and plaza area was to be situated on the south side of the grocery store.

But after the Town Council approved a resolution on March 13 that denied an appeal of the Raley's grocery store, and allowed that plan to move forward, the fate of Nugget Markets was sealed. Nugget Markets President and CEO Eric Stille made the decision.

"There is not enough sales potential for grocery sales in Truckee for all the stores," said Doug Wiele, president and founding partner of Foothill Partners in El Dorado Hills and co-applicant for the Nugget Markets project.

"It's a tough, tough business and Eric concluded the risk of profitability was too great to justify going forward."

Had Nugget Markets decided to stick with the Railyard project, it would have joined a growing roster of grocery stores in Truckee that already includes Safeway on Donner Pass Road and Save Mart on Deerfield Drive.

A proposal to build a Grocery Outlet on Donner Pass Road and Vista Avenue was approved by the Truckee Planning Commission on Feb. 20. The proposed site is located across the road from Safeway.

However, two local residents and an environmental group have challenged the planning commission's decision on Grocery Outlet. The Town Council is expected to hold a hearing on the appeals next month, said Truckee Assistant Planner Kirk Skierski.

But none of those projects are nearly as far along as the Railyard, which features a mixture of residential and commercial uses.

The Town Council adopted a master plan for the Railyard project in 2009. The Town Council also adopted an amended Railyard master plan in November 2016.

Since November 2016, a significant amount of work has been completed at the site, including infrastructure improvements and the relocation of Union Pacific facilities last summer. That work cost nearly $10 million, Hansford said.

Work on the residential component of the Railyard project, known as Artist Lofts, is expected to get underway in the next few months and feature a lot of infrastructure improvements.

The Artist Lofts project consists of 77 apartments to be housed in a four-story structure with about 3,855 square feet of ground floor commercial and retail space, according to planning documents filed with the Town of Truckee.

The project, which also includes about 45 covered parking spaces for residential use, would be built in an area bounded by Donner Pass Road Extension on the south, A Street on the east, and Church Street on the north.

"We are proceeding with construction in the summer," Hansford said.

Staff writer Wyatt Haupt Jr. can be reached at 530-550-2652 or via email at whaupt@truckeesun.com.