Stalled Hayes Valley grocery store sparks questions

The bottom floor of a Hayes Valley condo complex meant to house a Trader Joe's grocery store remains empty, and city officials are starting to ask why.

What's happening: Supervisor Dean Preston this week called on the board to investigate the stalled project at 555 Fulton Street that was supposed to be completed by early this year.

Why it matters: The inclusion of an affordable grocery store was a key demand from neighbors when the 139-unit condo building won approval some 15 years ago, the Chronicle reports.

• Its addition also allowed developers to expand the scope of the project and build more units.

What they're saying: "If there are legitimate reasons for not moving forward, let’s hear them. But delaying without a public explanation is not acceptable," Preston said in a written statement. "This space has been vacant for too long already, and we want to see it activated."

Flashback: Originally, the Portland-based grocer New Seasons was supposed to occupy the 29,000-square-foot space, but it canceled its lease in 2018.

• Trader Joe's received a special exemption to Hayes Valley's ban on retail chains in 2021.

Of note: The local neighborhood association has accused the project's developer, Z&L Properties, of dragging its feet on costly updates that need to be completed before Trader Joe's can move in, the SF Standard reports.

The intrigue: Z&L Properties is partially owned by real-estate billionaire Zhang Li, who was arrested last year on a warrant that accuses him of bribing San Francisco public officials to obtain construction permits.

• Mission Local reported that Zhang and the 555 Fulton Street project were at the center of the corruption case that led to the seven-year sentencing of Mohammed Nuru, the former head of Public Works.
• Z&L also owns a 109-unit condo complex in Hayes Valley on Oak Street that was completed over two years ago but mysteriously sits empty.

What's next: Preston said he wants a hearing on the stalled Trader Joe's to happen next month.