State & City Help fund competition for existing grocery store
Last month Mayor Slay made an announcement many had been expecting:
Schnucks will build downtown’s first full-service grocery store, a 20,800 sf urbanized version, in the Missouri Development Finance Board’s Ninth Street Garage at 9th and Olive Streets.
I guess I am not clear how mayor Slay defines “full-service.” City Grocers opened in October 2004 and offers this downtown resident everything I expect from a grocery store. Of course, I don’t expect to fill a prescription at a grocery store. Nor do I expect to get mylar balloons & florals from a grocery store. I expect groceries.
The Mayor continues:
This is an important step forward for downtown. I can’t tell you how many times people have asked me why downtown doesn’t have a supermarket, and where downtown residents shop. Now we have a great answer to both those questions — we will have a Schnucks downtown later this year or early next year, and downtown residents will shop at it.
And what exactly has the Mayor told all these many people asking about where to shop ? Hopefully City Grocers.
The business journal had more:
It will cost $7.56 million for Schnuck Markets Inc. to build out, stock and open downtown St. Louis’ first full-service grocery store. But the family-owned supermarket chain is getting help.
Lots of help — from tax payers of course.
Schnucks will pay $3.42 million necessary for tenant improvements, inventory and other opening expenses at the downtown location, at Ninth and Olive streets, according to state finance board documents. The remaining money will come from a combination of state, federal and city subsidies.
“If we didn’t have the public support, it wouldn’t be a viable project,” said Scott Schnuck, chief executive of Schnuck Markets. “We’re starting with a space that wasn’t designed for a grocery store.” The location will require a leveled floor, extensive wiring and other improvements, he said.
Not designed for a grocery store? Who’s fault is that? Schnuck’s development arm DESCO was involved in building the garage. And in razing the National register listed Century Building. And in suing two downtown property owners who believed a parking garage facing the Old Post Office would be a detriment to downtown.
Does this mean they could not lease the space to anyone else?
Back to the article:
The grocery chain will receive $1.1 million in state funds from the Missouri Development Finance Board (MDFB), $1.29 million in proceeds through the federal New Markets Tax Credits program and $1.75 million from the city of St. Louis through a development agreement that will operate like a tax increment finance (TIF) plan, according to a resolution approved March 18 by the state finance board. The city’s Board of Aldermen approved the development agreement March 14 and has sent its bill to Mayor Francis Slay for his signature.
So tax dollars are now being used to buy inventory??? Inventory that will be sold for profit! WTF? Meanwhile we have a grocery store already — just not one that is heavily subsidized. Granted prices will likely be less at this new Schnucks compared to City Grocers. So we are helping buy food for downtown loft dwellers.
Do we really want the state and city government handing out favors to help one business at the risk of harming another? What message does this send to someone looking to start a small business in the city? That once you’ve taken a huge financial risk and proven the market does exist we will swoop in and give favors to our wealthy buddies so they can steal your customers!
From the same article on the new store; “it will have a pharmacy — something that’s been missing downtown since Walgreens left a few years back.“ Walgreens, ironically was located in the very same spot — on the ground level of the Century. Walgreens was booted out so the building could be razed for a parking structure.
It will be nice to see a new Schnucks without a massive treeless surface parking lot out front.