At a meeting of the Hollister City Council earlier this month, the council approved some of the final details regarding a new 130,000-square-foot near Highway 25 and McCray Street. The developer, Hawkins Corporations Commercial Developments, an Idaho-based developer, may break ground on Hollister Farms by late spring.
In what may indicate a larger overall trend of attracting new retail business to Hollister, city officials and business leaders believe the Hawkins Corp. decision to build in Hollister shows that investors are becoming more and more confident in the health of the city’s economy. The inclusion of new retail facilities will also help to keep sales tax revenue local.
“It’s a good trend that retailers are coming here—that means that we are negating leakage online,” said San Benito County Business Council Executive Director Kristina Chavez Wyatt.
While big-box retail stores have struggled to stay afloat in recent years—such as the announcement by Toys “R” Us of its bankruptcy and decision to close all of its U.S. stores— two new tenants in Hollister are expected to be TJ Maxx and Ross, companies that specialize in discounted, overstock items. Both have shown the ability to be resilient in combating the growing rate of online sales.
Collecting sales taxes for online sales has been an ongoing challenge for cities, and with the inclusion of new brick-and-mortar retail, Hollister hopes to attract a more consistent stream of sales tax revenue. The city also hopes to retain consumers who often leave the county to do their shopping.
“We have leakage from people buying online and who shop in places like San Jose and Gilroy,” Wyatt said. “The city gets a portion of the online sales, but those need to be collected by the state Board of Equalization.”
The new construction may also be an indicator that investors increasingly see Hollister and San Benito as a safe economic bet. Recent studies conducted by the Association of Monterey Bay Area Governments reported that the population of Hollister is expected to exceed 43,000 by 2030—a growth rate of more than 1 percent per year.
“The big picture for the community is the desire for more retail and services in town, but companies need certain levels of population, education and income levels before they build in a town. and I think we’re finally reaching that place,” Wyatt said. “We’re reaching a point of smart and moderate growth in housing.”
It’s still unclear if the rate of growth is strong enough to attract a wider pool of incoming businesses. The new Hollister Farms center itself will need to attract tenants to fill the other large retail units, nearly two dozen smaller retail units, along with six fast food restaurant plots. According to the Hawkins Companies website, a Panera Bread is expected to fill one of the restaurant spots.
The resolution passed at the March 5 city council meeting approved utility and tree planting and maintenance easements on the property bordered by McCray and East Park Streets and Highway 25.