Richmark proposes grocery store for downtown Greeley
GREELEY — Downtown Greeley, which has been without a grocery store since the 2014 closure of Safeway on 11th Avenue, soon could have a new place to buy groceries.
Richmark Real Estate Partners LLC, the Greeley-based real estate development and investment company that owns numerous properties along the Eighth Avenue corridor, has submitted plans for a grocery store at 1320 Eighth Ave.
The store would be located in the long-vacant Downtown Deals on Wheels building. Richmark acquired the property in December 2015 for $1.2 million.
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The 1320 Eighth Ave. project is undergoing design review with the city of Greeley.
“This project will provide another key piece in the overall redevelopment of 8th Avenue between 10th Street and 17th Street,” according to a project narrative submitted to the city.
Bianca Fisher, executive director of the Greeley Downtown Development Authority, said landing a grocery store downtown has been a goal of the organization ever since the closure of Safeway at 1122 11th Ave.
“It feels like such a fulfillment of a goal that we’ve had for a long time,” Fisher said. “When Safeway left, and even prior to Safeway leaving, we tried to work with them and, honestly, looked at some incentives to help make some improvements to the building.”
But Safeway ultimately opted to close the store and used a deed restriction to prevent another grocer from occupying the space. Ultimately, the city purchased the property and built a new fire station at that location.
“Since that time, there has been an incredible gap in the market, and it’s challenging because you read about, and you hear about, just how difficult the grocery space is, just the market and how it’s changed,” she said. “It seems like we’re faced with this great need, but also the challenge in the market for grocery stores to be successful.”
Developers are not revealing the name of the prospective grocer, except to say that it’s a publicly traded company. At 12,946 square feet — with 20 parkings spaces in two lots — the store would be far smaller than what would be typical for a King Soopers, Safeway or other major grocery, which can range from 46,000 square feet to 125,000 square feet.
In contrast, Natural Grocers by Vitamin Cottage Inc. (NYSE: NGVC), based in Lakewood, operates stores that range from 5,000 square feet to 16,000 square feet, according to the company’s website. The chain operates a Greeley store at 2819 35th Ave., but it’s unclear whether the company is considering another Greeley location.
Natural Grocers revealed in a recent earnings announcement that, “As of May 6, 2021, the company has signed leases for five new stores, which will be located in Colorado, Missouri, Nevada, and Oregon. These new stores are planned to open during fiscal 2021 and beyond.”
Company officials said in an earnings conference call that the company was slowing its new-store growth because of lower sales from existing stores, as well as shortages of construction materials and contractors.
A Natural Grocers spokesperson did not immediately respond to a request for comment.
A downtown grocery store would come just as the area is adding hundreds of new residents.. Richmark has completed construction of the Apartments at Maddie — three buildings totaling 221 units along Eighth Avenue from 15th to 17th streets. Edison Equity Management Corp. is building a 55+ project at the former Garnsey & Wheeler location at 1100 Eighth Ave. And other residential projects are on the drawing board for the area.
“It’s fantastic, and it couldn’t come at a better time with the new residents that we have downtown,” Fisher said. “Grocery is key to that because if you’re going to be a resident living in a semi-urban environment, the best part of that is not having to drive to the grocery store.”
Fisher said that downtown office workers also will benefit from the grocery store.
She said that, given its small size, the proposed store will not fully address the need for groceries downtown.
“It’s a huge benefit,” she said. “I recognize this doesn’t fill the entire gap of being a food desert. Certainly, this is more of a niche grocery-store market, but I think it does a whole lot to help start to fill in that gap.”
Fisher said the location also works well, located toward the southern portion of the DDA district, which extends from Third to 17th streets, near a lot of the new residents, as well as the University of Northern Colorado campus.
The Greeley Downtown Development Authority at its April meeting gave initial approval for the project to receive tax-increment financing. A TIF agreement enables a developer to retain the increase in taxes generated by a project — the increment — for a specified period of time. The grocery store received initial approval to retain 100% of the TIF through 2033, less the DDA’s 5 mill levy and the 1.5% treasurer’s fee.
The TIF amount is estimated at $44,000 per year, up to $550,000 over the term of the TIF agreement, according to a presentation at the April 15 DDA meeting, and is contingent on approval of a Redevelopment Agreement between Richmark and the DDA. The actual TIF amount would be determined by assessor valuations over the period of the agreement.
Richmark already has done extensive renovations of the building, including facade improvements. The DDA provided a building-improvement grant for the project in 2018 of about $64,000, which was 10% of what Richmark had spent on the renovation.
Fisher said the 2018 grant helped lay the groundwork for the grocery-store deal, helping to “paint a picture” of what could be.
“This is exactly what we hope these grants will accomplish,” she said. “If the facades can be improved, interiors can be improved,” then potential businesses can say, “wow, we can envision something happening here.
“They [Richmark] sunk a good chunk of capital into the building to make it more appealing and attractive,” she added. “You look at what will still need to be done, if it was them or any other tenant, and it’s pretty significant.”
Fisher said the developer hopes to have the grocery store open by October, or year-end at the latest.
Adam Frazier, vice president of real estate development for Richmark, told the DDA board in April that the company would spend $756,383 on improvements, according to minutes of the meeting.
“The plan is to give the tenant another $2.6 million allowance to build out the space,” according to the minutes, in remarks attributed to Frazier. The lease term with the grocer would be for 15 years, with four five-year extensions.
Frazier declined to comment to BizWest Monday afternoon.
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