A preliminary management agreement is in progress for a new downtown Kansas City, Kansas, grocery store, according to Unified Government Administrator Doug Bach.
Bach said Monday that the UG has a signed letter of intent with the Merc Co-op for management of the downtown grocery store. He said the management agreement terms are fundamentally completed.
The UG has been working for years on developing a grocery store in the downtown “food desert” area of Kansas City, Kansas.
The plan is for a 12,000 to 14,000-square-foot full-service grocery store to be built at 5th and Minnesota Avenue, in the northeast corner of the Reardon Center parking lot, Bach said. He gave a report on the project at the Unified Government Economic Development and Finance Committee meeting Monday night.
Across from it on 5th Street is the old EPA building, which will be used for a University of Kansas Health Services site, and across from it on Minnesota Avenue is the Reardon Convention Center.
The Merc Co-op of Lawrence, Kansas, is the proposed operator of the new downtown grocery, Bach said.
Bach said the Merc has been working with the UG for some time on this project. People can come into the store, eat, gather and shop, and the Merc will target the store toward the clientele in the community, according to Bach.
He said there is a different clientele in each area, so the store’s operator would focus on what the community’s needs are. The store operator will be responsive and will be committed to having what the community wants in the store, he said. The Merc buys local food and has local partners, he said. They also do a lot of food education in their stores, he added.
Current plans are for the UG to be the owner of the store, with the Merc as the operator under a management agreement, he said.
The project size is a $6 million development, he said. The project would be funded through direct UG use of the Hotel Revenue Fund, Bach said. Money the UG received from the sale of the Hilton Garden Inn in the same block a few years ago will be reinvested in this downtown project, he said.
The project also will be funded by sales tax and property tax-increment financing, he said.
Although the UG will be the owner of the store under the current plan, the project will be able to be sold to a private entity in the future, according to Bach. If a private entity were to come in and buy it, the UG would be able to sell it to them, he said.
Just like the Hilton Garden Inn, which the UG formerly owned, and the theaters at The Legends, also formerly under UG ownership, the UG could sell the grocery store to a private developer, and that is the long-term goal, according to Bach.
If the budget allows, the UG could add additional square footage to the store to do additional things, he said.
According to Bach, the UG has assembled the cost projections and it has architects and engineers ready to begin work.
The UG will proceed with design and construction of the grocery store, while also continuing to work with master developers for other portions of the project area, according to Bach. The project could also include more retail and residential development in future phases, he said. Bach said the UG is working with neighborhood stakeholders to determine other services that are needed in the area. Specifically, a farmers market and a pharmacy were suggested as other retail options. Additional development would be through a private developer.
Bach said he feels the development agreement would come back to the August committee meeting for review, then it would go on to the UG Commission level. The UG could then begin the design and engineering phase, he said.
If it is approved by the commissioners, the design and construction bid process could begin in September, while continuing discussions with development partners about additional retail, according to Bach.
Then, in October, the final cost estimate and design program could be presented, and the groundbreaking date and construction timeline could be determined, according to Bach.
In a comparison to visualize the size of the grocery store, the proposed store downtown would have 12,000 to 14,000 square feet, compared to the Price Chopper at 77th and State Avenue, which has 68,000 square feet.
An audience member, Shirley Ikerd, a Kansas City, Kansas, resident, commented that she thought this should have been sent out to more people in the community to have the residents give more feedback on it. She did not think the whole community was involved in this, she said. She was also concerned about the money going to the project, and where it is coming from. She said there was another grocery store that also wanted to come here.
Bach said the Merc is a good operator, and would fit well in the community. It has been interested in this project a long time, he said, and the Merc has done a lot of work on it already.
Commissioner Tom Burroughs said he would try to get her some answers.
“I’m just excited we have a partner who wants to be in our community,” Commissioner Burroughs said. “I’m hoping they will be received well and treated with the respect that they will have already proven that they deserve in Lawrence.”