Downtown San Mateo is getting a full-scale grocery swap and a major facelift. Marin-based Woodlands Market is set to move into 222 E. 4th Ave, taking over the former Draeger's Market site as the anchor tenant in a planned five-story mixed-use project with office space and below-market-rate housing. The existing Draeger's building will be demolished to make way for the new development.
Project Plans And Size
The B Street South project calls for a five-story building with roughly 17,658 square feet of retail space for a grocery, about 104,554 square feet of office space and 10 low-income apartments, according to the City of San Mateo. The plan also includes a three-level parking garage with 221 spaces and was approved by the City Council in 2022.
Who’s Building It
Developers Lane Partners and Prometheus Real Estate Group are listed as applicants for the site and have taken steps to move the project forward. Industry reporting says Woodlands Market has signed on to occupy the ground-floor grocery space - roughly 19,000 square feet - and will serve as the retail anchor for the development, as reported by The Registry.
Local Leaders Welcome The Grocer
City officials are betting that a high-touch neighborhood grocer will be a draw for residents and office workers alike. San Mateo Mayor Adam Loraine told the San Mateo Daily Journal he hopes Woodlands' presence will serve as "a proof of concept that cities, developers and grocers can work together on amenities."
Woodlands founder Don Santa told the same outlet that "San Mateo feels like the perfect next chapter for the business," signaling enthusiasm from the company to plant roots in the downtown core.
About Woodlands Market
Woodlands Market is a family-operated chain with locations in Kentfield, Tiburon and San Francisco and emphasizes locally sourced produce, prepared foods and sustainable products, according to the company's website. The grocer pitches itself as an independent market that partners with small regional farms and offers chef-crafted meals and catering, a mix that has helped it carve out a niche against larger chains.
Grocery Requirement And Housing
City planning documents required that a grocery occupy the retail space as a condition of approval, and the project dedicates all 10 residential units to the low-income category, the city's project page shows. That pairing - an anchor grocery plus office space - is being pitched as a way to support daily neighborhood needs while boosting weekday foot traffic in downtown San Mateo.
A Brief History Of The Site
The downtown site has housed Draeger's Market since 1997. The San Mateo store closed earlier in 2025 as the city and developers prepared for redevelopment, a move that led to dozens of layoffs. The closure and replacement plan were reported by the San Francisco Chronicle, which noted the project originally called for a roughly 17,000-square-foot grocery when the plan was approved.
Timeline And What’s Next
Developers say they expect to demolish the existing building and start construction in early summer 2026, with the new grocery occupying the ground floor once tenant improvements and permitting are complete, per reporting in the San Mateo Daily Journal. City reviews and permits remain necessary before work can begin, and officials say they will monitor the project's progress as it moves through the city's permitting process.
