Downey approves new Costco warehouse and gas station on Firestone Boulevard

Downey approved a new Costco warehouse and gas station on Firestone Boulevard, advancing a two-phase deal that first moves Downey Nissan and then clears the way for the warehouse to be built. The package includes a $10.5 million city allocation from the General Fund Reserve, making the project as much a redevelopment play as a retail expansion.

City staff recommended a Master Development Funding Agreement tied to Costco, Downey Nissan, Andrews Rancho del Norte and Andrews Rancho del Sur. The plan centers on the former All American Home Center property and the current Downey Nissan site, with the Costco parcel described as 13.59 acres and the future Nissan site as 5.1 acres. A 1.38-acre Nova Storage parcel is expected to provide additional dealership parking, and a Los Angeles Department of Water and Power property could also be used if approved. Under the financing structure, Andrews would contribute up to $1.6 million toward the dealership move, Costco would provide up to $20.8 million for the new Downey Nissan dealership, and the city’s share includes a $10 million lease-cancellation payment plus about $500,000 for environmental and entitlement review costs.

For workers inside Costco, the approval matters because it moves the project from concept toward permitting, construction coordination and hiring plans. A new warehouse in a dense market can open transfer opportunities for front-end assistants, stockers, forklift operators, meat and bakery employees, optical staff and supervisors, while also bringing a new layer of volume, traffic and parking pressure to the area. The agreement also contemplates a future $3 million sales tax-sharing deal with Costco after a certificate of occupancy is issued, a sign that the city is treating the project as a long-term revenue source, not just another storefront.

Mayor Pro Tem Horacio Ortiz Jr. said the investment would "create hundreds of jobs, generate new revenue for essential city services, and strengthen our city’s future." Not everyone in the city sees the need as clearly. Some residents questioned on social media whether Downey needs another Costco at all, given the nearby Norwalk warehouse at 12324 Hoxie Ave., which opened on April 18, 1983.

Costco first notified Downey of its interest in late 2022, and the city’s latest vote puts the company closer to a new foothold in southeast Los Angeles County. For Costco employees, the next phase will determine whether the project eases pressure at surrounding warehouses or simply pushes that pressure onto a new crew on Firestone Boulevard.