Gustine, CVS Push Land Buys Despite Store Shutdown Plan

Last summer, Gustine bought its first metro Phoenix tract for CVS. Since mid-December 2001, three more locations have been purchased. The largest parcel is 10 1/2 acres at the northeast corner of Warner and Lindsey roads in Gilbert, where another retail developer has started negotiating to take the bulk of the tract, GlobeSt.com has been told. Gustine, CVS' preferred developer for six regions, will build a 12,000-sf drug store on the hard corner.

Also bought was 2.36 acres at the southwest corner of Olive and 107th Ave. and acreage at the juncture of Union Hills and 32nd Street, both in Phoenix. In March, CVS will cut the ribbon on its flagship Arizona store at NW Warner and McQueen in Chandler.

Dave Cheatham, senior vice president, and Darren Pitts, vice president, comprise the CB Richard Ellis team scouting the metro area for Gustine. The going prices for all land sales are being kept confidential because more tracts are under option or on the radar screen for CVS locations. The final store count also is not being disclosed.

The Pittsburgh developer, through its involvement with CVS' entry into Arizona, is lobbying for its own piece of the action in the bustling metro market. Existing retail properties as well as development opportunities share the Gustine focus, Todd Sergi, Gustine's real estate manager, tells GlobeSt.com. He declined to say if any properties are now under contract. In late November, Gustine acquired its first Arizona holding outside the CVS pact, spending $2.3 million for a two-tenant center on two acres in Scottsdale.

As for the CVS rollout, construction will start in the spring in Gilbert and Phoenix. The 38-year-old chain is targeting September for ribbon cuttings on the 12,000-sf freestanding projects.

Two Southwest Developers LLC of Cave Creek, AZ sold the Olive and 107th Avenue tract while Verde Investments Inc. of Phoenix parted with the 10 1/2 acres.

CVS' Arizona version will have drive-through service and open doors on a 24/7 basis. The retailer has about 4,100 stores in its network, with less than half in freestanding structures. The shutdown plan calls for shuttering strip mall locations and replacing most with freestanding buildings.