News Coverage Pittsburgh Tribune-Review – Thursday, January 18, 2007
Area BP stations to be sold
By Ron DaParma
BP America Inc. said Wednesday it is selling 41 convenience-store and stand-alone gas station sites it owns in the Pittsburgh region
to franchise operators or owner-operators, but intends to remain as a gasoline seller here.
The company, a unit of BP PLC of England, said the move is part of its expansion of its "ampm" convenience store-gas station franchising
brand into the Eastern U.S., including Indianapolis and Pittsburgh.
"This is part of our overall growth strategy," said Valerie Corr, a spokeswoman for BP in Chicago. "Essentially, by selling to franchisees,
they can take the stations and grow."
The company has hired a national real estate firm, NRC Realty Advisors LLC, to coordinate the sale.
Corr said the move does not signal any plans by BP to pull out of the highly competitive Pittsburgh-area market, where discounts on fuel
purchases are available at such locations as the GetGo sites tied to the Giant Eagle supermarket chain.
Recent changes in the marketplace have included the exit of the Texaco brand from its sites in the region last summer, and an announcement
in October by Chelsea, Mass.-based Gulf Oil LP that it plans to expand its presence in Pennsylvania, including in Pittsburgh.
"The Pittsburgh market is extremely competitive," said Nancy Maricondi, executive director of the Pittsburgh-based Petroleum Retailers &
Auto Repair Association Inc.
"We have Sheetz, which sells very close to cost, and now we have the Shop'n Save (supermarkets) offering discounts along with GetGos,
and it makes it very difficult for the independent operators to survive."
Maricondi's organization represents about 300 members, mainly independent gas station, convenience store and car wash owners, mostly in Western Pennsylvania.
By selling its company-owned stations and stores to be franchises, BP not only would secure proceeds from the sales, but would be spared
the expense of upgrading older or outdated locations, Maricondi said.
"I don't know if this market is a real profitable area for (BP)," she said.
BP has about 1,000 franchisee-owned or -operated ampm franchise stores in the Western U.S., and 2,000 more in Brazil, Japan and Mexico.
"Our goal is to build and recruit a franchise network East of Rockies that complements our already distinctive BP brand," said Ben Amante, BP's vice president of franchising.
Initially, buyers will operate the Pittsburgh-area sites under another brand, BP Connect, and after finalizing their purchase,
will complete the conversion and rebranding to ampm, the company said.
"We are offering franchise buyers the rare opportunity to purchase a franchise with real estate rights," Amante said. "We look forward to
building a strong network of franchisees to help us grow our business and deliver our products and services to more consumers."
While the 34 convenience store sites will be sold as franchises, seven other BP branded gas station sites that will carry BP gas, but
will be sold to "owner-operators" and not franchisees.
Eight properties without stations or stores will be sold as commercial development sites, the company said.
NRC will use a sealed-bid process to sell the properties, with a March 13 deadline for prospective buyers to submit offers.
Ron DaParma can be reached at rdaparma@tribweb.com or 412-320-7907.
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