The ‘Barron’s Roundtable’ panel discusses major retailers that beat the competition on value, their innovation and revenue models.
Costco plans to open a new warehouse in Los Angeles beneath an affordable housing complex, marking a creative expansion strategy for the retail giant.
The project, located in the Baldwin Village area of South Los Angeles, is expected to open in 2027, Costco CEO Ron Vachris said last month during the company’s first-quarter fiscal 2026 earnings call.
“We have a project in Los Angeles where we are working with a number of developers [where] there is affordable housing above a Costco just north of LAX,” Vachris said. “That project will open in 2027.”
Vachris said the unconventional approach allows Costco to enter markets where traditional big-box development would be nearly impossible.
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Costco plans to open a new warehouse in Los Angeles beneath an affordable housing complex. (Angus Mordant/Bloomberg via Getty Images/Getty Images)
“That would be a market we could never go into and find 25 acres to build a Costco,” he said. “It just wouldn’t happen.”
The strategy, Vachris added, also helps the company get closer to customers while reducing congestion in some of the busiest warehouses.
“We are finding creative ways to get closer to our members and take the pressure off some of our highest volume locations,” Vachris said. “…We continue to see some opportunities in markets that we had questioned in the past.”
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A Costco parking lot in Los Angeles. (Brian van der Brug/Los Angeles Times via Getty Images/Getty Images)
The project, developed by Thrive Living, includes approximately 800 apartments to be built above the warehouse. The building will also feature a rooftop pool and fitness center, according to the website Wall Street Journal.
About 184 of the apartments are expected to be for low-income households, the WSJ reports.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| COSTS | COSTCO WHOLESALE CORP. | 924.88 | +9.57 |
+1.05% |
Thrive Living founder Ben Shaoul estimated total development costs at about $425 million, according to the WSJ.
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The project, located in South Los Angeles, is expected to open in 2027. (Lindsey Nicholson/UCG/Universal Images Group/Getty Images)
During the retail giant CFO Gary Millerchip also pointed last month to unprecedented sales of pizzas, pies and e-commerce during the holiday season.
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