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Note 5 - Store Openings and Closings
6 Months Ended
Jun. 29, 2013
Store Openings And Closings Disclosure [Text Block]  
Store Openings And Closings Disclosure [Text Block]

5.      Store Openings and Closings


In September 2012, Gelson’s entered into a lease for a supermarket location in the marina area of Long Beach, California. Gelson’s took possession of the property on March 1, 2013. Gelson’s is in the process of extensively remodeling the site and currently anticipates opening a new Gelson’s supermarket at that location in late 2013. The development and actual opening of the location, and the costs of remodeling, are subject to normal construction uncertainties and the ability to obtain necessary governmental approvals among other things.


Gelson’s closed its store located in Northridge, California after the close of business on February 25, 2012. Effective March 6, 2012, Gelson’s reached an agreement with the landlord and a third party to assign the lease of the Northridge store to the third party. Gelson’s rent and all other obligations under the lease agreement ended May 1, 2012. In accordance with the assignment of the lease, various items of equipment were transferred by Gelson’s to the assignee and Gelson’s paid the assignee a lease assignment fee of $1,850,000 during the second quarter of 2012. In addition, Gelson’s incurred other closing costs of approximately $393,000 during fiscal 2012 to transfer excess product and supplies to other Gelson’s locations, to write off product which could not be transferred, to shut down and relocate or write off equipment and to maintain the store until Gelson’s was released from its lease obligation. Anticipated exit activity costs were recorded on the Condensed Consolidated Statement of Comprehensive Income in the line titled Loss (Gain) from Exit Activity during 2012. These costs were net of the reversal in 2012 of a deferred rent liability of $331,000 previously recorded for the Northridge location.


On March 18, 2013, the Company announced its decision to terminate the lease for its Gelson’s location in Pasadena, California in accordance with the lease terms. The store was closed on June 15, 2013, and Gelson’s rent and all other obligations under the lease agreement ended July 21, 2013. Gelson’s transferred some of the fixtures and equipment from the Pasadena location to the new Long Beach store discussed above. Gelson’s has recorded closing costs of approximately $170,000 to transfer excess product and supplies to other Gelson’s locations, to write off product which could not be transferred, to shut down and relocate or dispose of equipment and to maintain the store until Gelson’s was released from its lease obligation. These closing costs are included in the Loss (Gain) from Exit Activity line on the Condensed Consolidated Statement of Comprehensive Income. Active employees at the time of closure of the Pasadena store were offered employment at other Gelson’s locations.