US bulk-buy retailer Costco to open up to three stores in Adelaidehttp://www.adelaidenow.com.au/realestat ... 6439454041
BULK-BUY retailer Costco plans to open the first of up to three stores in Adelaide as early as next year.
The US warehouse wholesaler is negotiating to secure a 5ha site for its first store, which it says will open up opportunities for local food manufacturers and growers.
In another retail boon for the city, property developer Lang Walker and the Makris Group announced yesterday that they have agreed to develop the overgrown former Le Cornu site at North Adelaide, breathing life into the prime retail location, which has been vacant since 1989.
They are proposing a $200 million retail and residential development combining high-end boutiques, cafes, restaurants and office space.
The plan is to start selling the apartments and penthouses on the building's upper levels next year. Talks have also begun to secure a major European retailer.
Business SA chief executive officer Nigel McBride welcomed the developments and the jobs that would follow, as well as the competition created by new market entrants.
"New experiences for shoppers are important to keep the local economy vibrant and competitive," he said.
"There is always a place for the small specialist retailers that provide the touch-and-feel experience, and we have an economy where both the smaller and larger outlets can co-exist."
Australian Retailers Association executive director Russell Zimmerman said the US retail giant's interest in SA, plus plans for new high-end boutiques on O'Connell St, showed long-term faith in the future of the local market.
Even though consumer spending was still soft, only growing 0.5 per cent last month, he said "retailers will look to the future, knowing things will turn around, and they see the opportunities".
Costco's Australian managing director Patrick Noone said the wholesale retailer had identified a couple of potential sites for its first Adelaide store, in the city's north and south - he would not say where - and was in negotiations to "work through the commercial terms".
Mr Noone said he expected the store to open by late next year or early 2014.
Costco operates as a no-frills "membership warehouse club" where, for a $60 annual fee ($55 for businesses such as restaurants) members get discounts on bulk items.
The first Adelaide store would employ between 325 and 350 staff, and would cover 5ha with up to 700 carparks.
It will have shelves and pallets of products, from bulk deli items to own-label nappies and electronics, across 13,500 to 14,000sq m of floor space.
The building alone would be a $25-$30 million investment, Mr Noone said.
"We do see Adelaide as a huge potential site for us ... now we've just got to find the right location," Mr Noone told The Advertiser yesterday from Seattle, where the company is based.
"We've been in discussions for a few months now on a couple of different sites, so we're not cruising the market anymore," he said.
"In the future, Adelaide may have two locations or three, so we're looking for the first one in the best spot, to build upon that. Adelaide's not a large city, so wherever we go, we're going to be pretty central to everyone in the first instance."
The retail giant has launched three sites in Australia since 2009 - in Melbourne and Sydney, which both also have a hearing-aid centre, and one in Canberra.
It recently announced it would build a second Melbourne store at Ringwood, one of a handful it hoped to open nationally next year, with Brisbane to also get its first store.
Melbourne man Javier Paredes said shopping at Costco "easily" saved him more than a few hundred dollars every year.
"When I go, I buy stuff not only for us, but for other members of my family because the more you buy, the cheaper it is," Mr Paredes said.