The City’s Economic Development Committee decided unanimously to approve a $500,000 subsidy to Farmer’s Best Market to assist Farmer’s Best to build out its store at 430 Asbury Ave. The subsidy would be provided over time by sharing City sales taxes with Farmer’s Best up to the $500,000 amount.
Farmer’s Best has entered into a 12-year sublease of the space at 430 Asbury Ave., which has been vacant for three years, said Morris Robinson, economic development planner. The store will sell produce, fish/meat, groceries, and beer and wine. “They are coming in with a wonderful store, a wonderful design,” Mr. Robinson said.
The principals met with neighbors at the site last month, and more than 200 people attended, showing support for the store. Referring to Aldermen Ann Rainey, 8th Ward, and Anjana Hansen, 9th Ward, Mr. Robinson added, “The aldermen were adamant: They wanted a grocery store.”
Nick Merikas, one of the principals of Farmer’s Best, said the stores they operate emphasize freshness. Their stores are full of fresh produce, fresh fruit and have a wonderful deli, he said. They will be competitive for the whole community, whether households make $40,000 or $150,000, he added.
The shop owners requested a sales-tax-sharing subsidy to help offset the cost of the cooler/refrigeration equipment needed for the store, which is pegged at about $560,000, said Bob Richlyki, a representative of the City’s consultants Kane, McKenna and Associates, Inc. He said Farmer’s Best’s sublease did not contain an allotment for tenant improvements, although the rent charged under the sublease was less than the amount being paid under the original lease. He said a gap exists between the estimated cost of the improvements and start-up inventory, pegged at about $2.2 million, and Farmer’s Best’s ability to finance the improvements.
Farmer’s Best projects it will have sales totaling about $94 million during the six-year period 2009 through 2014. Based on those projections, the store would generate about $1,035,000 in City sales taxes. Under the sales-tax-sharing agreement, one-half of the sales taxes generated would be shared with Farmer’s Best, up to a maximum of $500,000.
“I think this is all very, very good news,” said Ald. Melissa Wynne, 3rd Ward, “I have a lot of people in my ward who would like this type of store. We’ve used sales tax in the past to bring businesses.”
Sixth Ward Alderman Edmund Moran said Ald. Rainey, Ald. Hansen, and Mr. Robinson worked very hard to make this happen, adding, “I think this is going to be a terrific development.”
The site of the new store was formerly occupied by an Osco Drug store. Osco was closed about three years ago, after CVS acquired Osco and opened a new CVS store on Howard Street and Asbury Avenue. Ald. Rainey said CVS could have leased the vacant space to an auto parts store or for other uses. By not doing so, “they showed respect to our community,” she said.
The Committee directed staff to prepare a sales-tax-sharing agreement for the Committee to review. The arrangement is still subject to City Council approval.