Grocery Outlet hones in on Sebastopol
Grocery Outlet will hold meetings in January and February to answer questions about the company and its plans for the old Rite Aid site in downtown
Sebastopol residents got a flyer in their mailboxes this week from Grocery Outlet, which is considering leasing the old Rite Aid building on Main Street.
The company is holding two community open house meetings in the upcoming weeks: one on Monday, Jan. 26, from 5:30 pm to 7 pm, and another on Monday, Feb. 2, 5:30 pm to 7 pm. Both meetings will be held at Sebastopol Center for the Arts, 282. S. High St.
Back in October, Ross Fredericksen, Grocery Outlet’s VP of Sales and Merchandising, told the Sebastopol Times, “We’ve been looking at Sebastopol for a long time.”
Apparently, now they’re taking a closer look.
Regarding the upcoming meetings, Joseph Tanner, entitlements manager for Grocery Outlet, said, “Basically, we want to answer questions that the community has about Grocery Outlet and introduce ourselves to the community.”
Grocery Outlet got its start in 1946 selling military and government surplus food. Originally named Canned Foods, it changed its name to Grocery Outlet in 1987. Based in San Francisco, it now has 563 stores nationwide, according to a recent article in Business Insider.
Similar to a franchise company, Grocery Outlets have independent owners that profit-share with the corporation. Interestingly, the company seems to have a preference for married couples as owners.
“I’m from the Emeryville headquarters, and I represent the Grocery Outlet corporate side that supports the independent operators,” Fredericksen said. “The independent operator is an independent business owner. And so, for example, you have a different independent business owner in Rohnert Park than you do in Santa Rosa than you do in Petaluma, right? And so we would have an independent business owner that would be a Sebastopol independent business owner, and then become part of the community and support the community through providing quality, fresh food and value in their grocery shop.”
It won’t be a simple move-in, however. The Rite Aid site is covered by Sebastopol’s Formula Business Ordinance—which is meant to keep formula businesses outside of Sebastopol’s downtown.
The ordinance, which was updated in fall 2025, was originally drafted in the aftermath of an expensive legal battle the city fought to keep CVS from moving to its current downtown location on the corner of Highway 12 and Petaluma Boulevard.
Many people in Sebastopol seem to think of Sebastopol’s Formula Business Ordinance as a total ban on chain stores and chain restaurants of any kind, but that’s not exactly the case. According to Sebastopol’s Municipal Code, the ordinance specifically bans only three types of businesses outright:
A. Formula business offices on the ground floor street front.
B. Formula business restaurants. (This is why some folks were upset when the city accidentally OK’d a Little Caesar’s Pizza near the CVS in Sebastopol.)
C. Formula business hotels and motels. (Ord. 1111, 2018)
We asked Sebastopol’s interim Planning Director Jane Riley what it would take for Grocery Outlet to get permission to move into the old Rite Aid site.
She wrote back the following:
To open in that location, Grocery Outlet would need the following from the City:
A Use Permit for a formula business;
A Use Permit for alcohol sales, if they intend to see alcohol;
Design Review approval for exterior changes;
A Building Permit to make tenant improvements; and
A Business License.
Getting a use permit for a formula business entails filing an application with the Planning Department and a public hearing before the planning commission. If an applicant is denied by the planning commission, they can appeal to the city council.
Grocery Outlet does not have an advantage in this process just because they are replacing another formula business (i.e., Rite Aid),
“It’s a different business with different characteristics than the Rite Aid,” Riley wrote. “They will still need the City permits and entitlements listed above.”
In the meantime, the Grocery Outlet team is gearing up for the upcoming community meetings in Sebastopol.
“We are looking forward to offering the community what we would bring—in terms of value and offering of quality, fresh foods at prices that are affordable and that can help sustain families throughout the region,” Fredericksen said.
UPDATE 1/18/26
The Sebastopol Times has learned that Grocery Outlet has a signed a lease for the Rite Aid building on Main Street in Sebastopol. Kyle Noble, senior director of marketing at Grocery Outlet, wrote the following:
We are very excited about the opportunity in Sebastopol and have a fully executed lease that is recorded against the property with the County Assessor’s office. We hope to start construction later this year with a target to open in 2027.
Our goal [with the upcoming community meetings] is to listen and engage the community early in the process. Our open houses give residents an opportunity to ask questions, share concerns, and better understand who we are and how the store operates on a daily basis especially with our Independent Operator business model.
The company still needs to get a use permit from the city of Sebastopol and check off all the other procedural steps listed in our article below.
It is a formula business. There is no need for it. We have enough markets with affordable food.
I’d trade Grocery Outlet for Amazon’s Whole Foods any day.