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Published: Thursday, 4/28/2005

Central city residents to return to life without major grocers

BY GARY T. PAKULSKI
BLADE BUSINESS WRITER
The Food Basics on Cherry Street has been a convenient supermarket for shoppers like Kim Huss. The Food Basics on Cherry Street has been a convenient supermarket for shoppers like Kim Huss.
WADSWORTH / BLADE Enlarge

Budget-conscious shoppers in Toledo's central city who waited for years for a major supermarket face a double wallop.

On top of an announcement Tuesday that the area's biggest grocery store, on Cherry Street at Bancroft Street, will close, a nearby Aldi is shutting its doors Memorial Day weekend.

"We need a grocery store down here!" said Food Basics shopper Betty Huntley, who complained that other central city stores offer a limited selection or are too pricey.

The Food Basics store will close within 90 days, along with two others in the no-frills chain, in West Toledo and South Toledo. About 300 employees will be furloughed.

All three sites probably will attract interest from other retailers because they are in heavily populated areas, but they are unlikely to draw a national supermarket chain because of industry cutbacks and changing dynamics, real estate experts said.

The closings, which are part of an attempt by parent Great Atlantic and Pacific Tea Co. to cut costs, will have the greatest impact in the central city, shoppers said.

The effects will be compounded by the closing of the Aldi on West Central Avenue near Cherry, they added. Owned by a no-frills German discounter, the store has had "declining profitability over the last couple years," said Tom Behtz, an official at divisional headquarters in Hinckley, Ohio.

The closing, set for May 28, will not affect five other metro area locations.

Ms. Huntley said the lack of grocery choices in the central city is particularly hard on residents without transportation. "I sometimes walk here," she said.

"It's sad," added another shopper who declined to give her name. "With all of these apartments, new houses, and senior citizens' high-rises, there are a lot of people. But many of them will need a ride to shop."

"I'm concerned," said Deborah Younger, executive director of nonprofit Onyx Inc., a central city neighborhood redevelopment organization. "We will once again be without a supermarket and we will have vacant buildings we will not have a use for."

Officials of Toledo's economic development department did not return a call seeking comment. The three Food Basics to be vacated were built as or converted to Farmer Jack stores within the past four years. They were converted a year ago to the discount Food Basics format when the chain failed to achieve desired sales. Three other locations in the suburbs remained Farmer Jack stores.

Cincinnati-based Kroger Co. currently dominates the metro Toledo grocery market, followed by Meijer Inc., of Grand Rapids, Mich.

Officials at A&P, in Montvale, M.J., told union officials this month that its six Food Basics and Farmer Jack stores in metro Toledo were for sale. The fate of the Farmer Jack stores is uncertain, although a chain spokesman said there are no immediate plans to close them.

Also this week, A&P, which has struggled financially recently, indicated that nine Food Basics and two Farmer Jack stores in metro Detroit will be closed, according to officials of the United Food & Commercial Workers union, which represents employees.

David Kienzle, a real estate developer who rents to Farmer Jack in an upscale shopping center in Perrysburg Township, said he is working with the chain to find a replacement tenant. He is negotiating with prospects and hopes to land an upscale grocer.

He predicted that it will be difficult to find replacement grocers for the Food Basics stores in Toledo because many chains have gone out of business or have stopped expanding.

Factors the move of Wal-Mart Stores Inc. into expanded grocery offerings; the popularity of dollar stores, which carry a mix of groceries and hard goods; and the growing number groceries found in drugstores, said Dave Long, a retail specialist with the Maumee commercial real estate firm CB Richard Ellis/Reichle Klein.

"The locations are good from a real estate perspective," Mr. Long said of the Food Basics stores. "But it's going to be difficult to capture a conventional store. There is a real short list of conventional store operators."

The most likely scenario, he said, is that the sites will be snapped up by smaller, independent grocery retailers or by other retailers.

Contact Gary Pakulski at:

gpakulski@theblade.com

or 419-724-6082.



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