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Viability of East End grocery debated

CHARLESTON, W.Va. - For over a decade, city and business leaders have talked a lot about recruiting a grocery store to Charleston's East End.

It was once again a topic of discussion at Tuesday's Charleston City Council meeting.

Officials even recently floated the idea of offering some type of incentives or subsidies to make the area more attractive for investment.

But business leaders remain split over whether the market will support a grocery store on that end of town.

 "We have beat this thing to death," said Jan Vineyard, president of the West Virginia Oil Marketers and Grocers Association.

 Vineyard has been one of several people working to expand shopping opportunities for East End residents ever since the Smith Street Kroger closed its doors in 2001.

In a statement released at the time, Kroger said it closed the store because it wasn't large enough to offer the variety of products and services its customers deserved.

"Sales have been steadily declining, and the store has been unprofitable for the past four years," the company said.

Many community leaders have focused their efforts on getting a grocery store built on the vacant lot at 1315 Washington St. E.

Kroger officials actually looked at that site prior to closing the Smith Street store in 2001 but they passed on it.  

"Ultimately, the high cost of the land appraisals made it impractical to pursue," the company said at the time.

Fast forward nearly 12 years, and many of the same issues remain.

The Washington Street land is currently appraised at $525,000, and officials say that is still too high a price to attract developers.

Officials with the Charleston Urban Renewal Authority have talked about writing down the cost of the land as an incentive to potential developers.

But Vineyard said talk of incentives will raise the ire of many local business people.

"That's really not fair," she said. "I think you start down a slippery slope in who gets them and who doesn't."

Vineyard, whose organization represents businesses like the Spring Street and Kanawha City Foodlands, along with the Washington Street One Stop location by the Capitol, said many local retailers have expanded their food lines to help accommodate the East End.

She said One Stop recently renovated its store to allow more room for staples like milk and bread. The Kanawha City Foodland offers home delivery of groceries for $10.

"I think the market's giving the East End what they need," Vineyard said.

The group known as East End Main Street and the Charleston Area Alliance sponsored a market study in 2010 to see if a grocery store in that area was feasible.

That study found that the East End could support a 20,000- to 30,000-square-foot facility that could net between $7 million and $10 million in sales per year.

While such a store would be smaller than the larger supermarkets being built today, it would be slightly bigger than some of the Fas Chek stores in the Kanawha Valley.

Fas Chek owner Don Tate said he would like to have a store in the area himself.

"I think there is a great potential for the East End of Charleston for a supermarket," Tate said. "There's no doubt in my mind that it would be successful."

Tate operated a Fas Chek on Smith Street in the East End until the late 1990s.   

He said while there are several existing options for East End residents to get food, they're not very convenient.

"It's well served because they drive five miles to buy their groceries," Tate said.

He said he would love to place a store on the vacant Washington Street property.

"I think you could take a 12,000-square-foot store and serve the needs for the people on the East End," Tate said.

So why doesn't he do it?

The cost.

Even if Charleston leaders were to write down the entire cost of the Washington Street property, Tate said a developer still would need to invest $1.5 million to build and stock the store.

He estimates it would take $500,000 to $600,000 to erect the building. Equipment would run about $750,0000. Then it would take another $250,000 to stock the store shelves.

Tate said he just doesn't have the resources to make that kind of investment.

"There's a wonderful opportunity if you could get the capital to do it with," Tate said. "If one of these millionaires would like to make a nice donation to me and the people of the East End, I'd be happy to do it."

He said it would be wonderful if city leaders could secure some special financing or development loan to get the business started.

"You ought to be able to get a small business loan guaranteed by the government, because you're serving the people - you're serving the whole East End of Charleston," he said.

But while Tate was optimistic, another veteran store owner was not.

Joe Joseph, owner of the Spring Street Foodland a short distance from the East End, said increasing competition from stores like Target and Walmart have made it hard to make a living in the grocery business.

He said big-box stores advertise low prices and hurt smaller businesses.

"Target uses groceries as a drawing power," Joseph said. "They don't care if they make a dime or not."

And he said consumers will flock to those low prices.

"People are cherry pickers," Joseph said. "They'll travel 15 miles and pay $10 worth of gas just to save a nickel."

He said retailers now have to have very large stores and move lots of volume to make profits and compete with the larger corporate chains.

He said he didn't think the East End could support that type of store.

"I think the public will be better served and the city save a lot of money if they stay with what they've got," Joseph said. "I don't think they're doing an individual a favor by trying to get them in there."

Contact writer Jared Hunt at jared.hunt@dailymail.com or 304-348-5148.

 


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