Noe Valley Voice February 2007

Deal to Buy 24th Street Bell Falls Through

By Olivia Boler

Back in October 2006, the Noe Valley Voice reported that Harley DeLano and his company DeLano Retail Partners were just a few weeks away from becoming the new owners of 11 Bay Area Cala Foods and Bell Markets, including the one on 24th Street. In December, however, the agreement for the purchase of the Noe Valley supermarket fell through.

Because of a confidentiality clause in the escrow terms, DeLano cannot give details as to why the deal soured. His company did successfully purchase eight of the 11 markets, which are owned by Ralphs Grocery and its parent company Kroger Co., based in Cincinnati, Ohio.

"All I can tell you," DeLano says, "is that in the instance of the Noe Valley store, we were not successful in our approach with the landlords there. We thought the deal was done, but it was not, and we are not going to be the operators of that store."

One of the eight stores DeLano did purchase was the Cala Foods in the Castro, at 19th and Collingwood streets. The transfer of that store to DeLano's control will go through in February. Five other stores are in Marin County, and the remaining two are in San Francisco, on Geary Boulevard and South Van Ness Avenue.

Mark Campana of Anchor Realty is the broker for the property owner of the Noe Valley Bell Market, Bell-Camp Investments. Some of Campana's family are owners of the property, but he himself has no personal ownership interest in it. Campana, who is a board member of Noe Valley's Community Benefit District (also known as the Noe Valley Association), wants to assure Bell Market patrons that nothing is going to change at that location in the foreseeable future, and that Kroger is no longer looking to sell the store.

"Kroger is prepared to honor the terms of their lease [on the 24th Street store], which expires in 2009," he says.

Campana would not give any clues as to why the deal did not work out. "That's between the parties," he says.

Some have speculated that it might have had to do with DeLano's interest in changing the name, and that the landlord was against it because the Italian word campana means bell. Mark Campana laughs at this notion. "The name thing was not a part of the deal not going through. The current lease does state that the Bell Market sign shall remain during the term of the lease, but all of that goes away in 2009."

Richard May, president of the neighborhood group Friends of Noe Valley, finds it curious that DeLano was interested in such a short lease takeover in the first place. "The grocery industry is a really low-profit industry, so if the DeLanos went in and sank a lot of money in the store and then at the end of three years the landlord decided not to renew the lease, they would lose out. I'm not surprised the deal didn't go through," May says.

Harley DeLano says that even though he and his company have decided to move forward and concentrate on their new acquisitions, he hasn't completely closed the door on Noe Valley. The former president of Cala Foods and Bell Markets in Northern California, who now lives in Greenwood near Auburn, raising cattle and horses, has a soft spot for the neighborhood.

"I've always wanted to be back [in business] in Noe Valley. It's a very special store and a very special place. We're still open for it in case something were to come back to us, and we would still very much like to be your grocers," he says. "But we're respectful of the principal parties in this and their decision."