It didn't hurt that the price included a parking space and two storage lockers, not to mention a cute little balcony. And not too far away, in another neighborhood in Alexandria, Va., a new mixed-use residential development was rising on the grounds of a former rail yard.

But one of the biggest reasons he figured the unit would be a great investment: Whole Foods Market, (WFMI ) the building's ground floor retail tenant.

"Whole Foods is going to give identity to the neighborhood," said Katz, an urban planner and author of "The New Urbanism: Toward an Architecture of Community."

The apartment building, The Royalton in Alexandria, Va., is not quite finished but it sold out quickly. "There was a waiting list. I had to be very aggressive to get my unit," said Katz.

With its natural and organic foods and its vast array of perishables, Whole Foods has become a successful supermarket-industry trendsetter. Unlike many struggling grocery chains, same-store sales at Whole Foods are growing in double digits.

Now Whole Foods is becoming a trailblazer in the real estate industry. Developers want the stores to anchor swank new residential projects in up and coming or pioneering urban neighborhoods from San Francisco to Miami.

Whole Foods will take up a full city block of retail space at Avalon's new Chrystie Place, a 350-unit luxury rental apartment building under construction on Manhattan's Lower East Side. At 65,000 square feet, it'll be the largest supermarket in Manhattan, second only to another Whole Foods at the Time Warner Center at Columbus Circle.

Time Warner Center's Whole Foods is one of the top-performing stores in the chain, Whole Foods executives say. The 58,000-square-foot store takes up the basement level of the 55-story twin complex, which includes 200 ultraluxury condos, offices, high-end restaurants and a vertical retail mall.

"There's certainly a momentum to do more," said Chris Pine, a Whole Foods real estate executive, adding that the food chain is swamped with calls from residential and mixed-use developers. "We'll do these in most major markets in the U.S."

"The brand has great identification with one of the major housing movements - the new urbanism," said John Schleimer, president of consulting firm Market Perspectives. "The buyer profile of these new urban projects associates greatly with chains like Whole Foods," he said, noting that their tastes are "eclectic and progressive."

Whole Foods is slated to go into other looming high-profile apartment projects in various stages of development, including Seattle, Minneapolis, Hollywood, Calif., Miami, Phoenix and New York's Tribeca district.

They're expected to draw customers not just from apartment dwellers attached to the stores but residents and visitors from the surrounding neighborhood.

Jorge Perez, whose Related Group of Florida is developing the Icon, a condo tower planned for Miami's downtown, says he's counting on Whole Foods to serve as a beacon to draw in would-be buyers as well as other businesses to the desolate area.

In the past, national grocery chains largely avoided inner cities, leaving the field to smaller local chains, Katz says. "They couldn't follow all their suburban formulas such as parking and square footage," he said.

One key to Whole Foods successful entry into urban locations is its willingness to adapt to various and ever-bigger site plans. "They are very chameleonlike. They will fit into the constraints. Most retailers don't think like that," said Rob Bond, president of Chicago-based development firm Bond Cos.

While Whole Foods is the most visible example, a smaller number of traditional supermarket chains such as Safeway and Ralph's have ventured into emerging urban neighborhoods, though not typically as anchors of new apartment buildings.

"Grocery stores have a very important role in making a neighborhood in an urban place," Katz said. "But a lot has to do with which grocery store. If it's a downscale chain, people get nervous."

One of the first apartment projects to bring in Whole Foods was the 160-unit rental property Aurora in downtown San Francisco's emerging South-of-Market, or Soma, loft district. Whole Foods moved into the ground floor about two years ago.

"Our occupancy spiked up and it's never looked back," said Bond. His development firm opened the Aurora in 2000. "We believe Whole Foods has been a key component in keeping our property filled," he said.

Developers say Whole Foods adds value and prestige to their projects. "Whole Foods is regarded as a five-star supermarket," said Don Milliken, president of the Milliken Development Group.

Whole Foods will be the food anchor of one mixed-use Milliken project known as 2200 Westlake, located on the north edge of downtown Seattle. Set to open in October 2006, the complex includes 261 pricey condos, retail shops and the Pan Pacific Hotel.

Milliken's financial partner in 2200 Westlake, Vulcun Inc., founded by Microsoft co-founder Paul Allen, recently agreed to buy out Milliken's share. Milliken says that will give him the funds to develop yet another mixed-use development on the edge of downtown Minneapolis.

Whole Foods will figure prominently into that project, too, he says. Plans call for 250 condos and a Whole Foods store of at least 76,000 square feet, about 30,000 square feet larger than the one at 2200 Westlake.

"We think having Whole Foods in our development is going to differentiate us in a very positive way from other condo developments in central Minneapolis," Milliken said.

The combination seems to be a win-win for both the developer and Whole Foods. "They mutually activate each other. They become accretive to the project as a whole," Bond said. He says Whole Foods' sales at the Aurora are doing close to four times original projections.

Developers say their target customers are the same ones that like to shop at Whole Foods. They are often single or couples without children that have ample incomes. They don't mind spending a little more for quality and they want convenience.

Chrystie Place promotions, for example, beckon potential renters to "head downstairs to Whole Foods for some gourmet food. Meet up with friends in the resident lounge, or bask on the sundeck."

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