Walmart scraps Atascadero development project

Feb 13, 2017

After ten years of negotiations, a lawsuit, public outcry and thousands of staff hours spent working out possible traffic logistics, Walmart has called it quits on building a new store in Atascadero in San Luis Obispo County. 

Atascadero city leaders announced Friday that Walmart had officially sent word its development proposal for the corner of Del Rio Road and El Camino Real on the northern edge of the city is canceled.

Walmart spokesperson Delia Garcia says the company made a business decision to invest in improving existing stores instead, like nearby Walmart stores in Paso Robles and Arroyo Grande.

Terrie Banish, the city’s deputy city manager, cited robust e-commerce and online sales as contributing to the company’s decision.

Atascadero’s mayor says if the company had withdrawn four or five years ago, the news would have been quote more difficult to receive.

“The city will be working with new potential partners, and we are optimistic about the options that this retail location will offer,” Mayor Tom O’Malley said in a statement.

The development proposal for a new 127,000 square foot store was initiated over a decade ago and stepped up in 2015, the city started working on the development’s design with Walmart contractors.

In 2012, when the proposed development called for construction of the store, an adjacent “annex” 130,000 square foot shopping complex and 50 residential units - all on 39 acres of vacant land, a group called “Save Atascadero” filed a legal challenge to the project’s Environmental Impact Report. A court ruled in the city’s favor and the project proceeded.

As of June 2016, according to city documents, Walmart planned to cover $5.1 million dollars in costs to improve traffic circulation around the development. By then Atascadero city officials had approved a site plan, but forward momentum on the project stalled before grading and roadway construction around the planned development began.