Alfalfa's Market may come to Centennial

Grocery store gets OK for tax rebate from city during changing times for retail

Posted 6/17/18

Amid a steady stream of closings for grocery and other big-box stores in the metro area, one vacant building not far from East County Line Road and Interstate 25 may rise from the ashes as an …

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Alfalfa's Market may come to Centennial

Grocery store gets OK for tax rebate from city during changing times for retail

Posted

Amid a steady stream of closings for grocery and other big-box stores in the metro area, one vacant building not far from East County Line Road and Interstate 25 may rise from the ashes as an Alfalfa's Market.

The Boulder-based grocer, whose two locations sit in that city and nearby Louisville, would break into the metro-area market at the south edge of Centennial near the Willow Creek neighborhood. And Alfalfa's would do it on the strength of an up to $500,000 sales-tax rebate from the city, paid over a maximum of 10 years.

“The city recognizes that significant changes are occurring in the retail industry due to the rise of online shopping, the Amazon effect and consumer desire for new retail experiences,” said Neil Marciniak, economic-development manager for Centennial. “These changes will continue to impact the city's main revenue source, sales tax, while at the same time impacting our neighborhood-shopping centers and the surrounding residents.”

In line with what officials call the city's “Retail Reinvestment Strategy,” the Centennial City Council approved an agreement with Quebec Alfalfas LLC, the company that intends to redevelop the building at 8101 S. Quebec St., at the June 4 council meeting.

That site, the former U.S. Toy building, sits mostly vacant not far from a former Safeway that closed in June 2015 — one of nine in the metro area that shuttered at that time — and an Albertsons just a few minutes northwest at 7450 S. University Blvd. that closed in November 2016.

The city is banking on the idea that Alfalfa's isn't just a normal grocery store. It boasts an extensive in-house menu, allowing shoppers to eat in its food court or carry a take-out meal home. Its website talks up its support of “local, organic and innovative food, wellness products and culinary creations.”

“The project provides an opportunity to further the city's goals and objectives, including the Retail Reinvestment Strategy, by introducing a unique tenant to the trade area and updated architecture that represents current and future retailing development trends,” a report by city staff said.

Centennial's reinvestment strategy generally is a pivot toward recognizing the trend toward experiential uses, a term for services like restaurant dining that consumers can't get online.

“Alfalfa's brings a unique retail and grocery concept to Centennial,” Marciniak said. The neighborhood's “Safeway space was taken over by VASA Fitness, which is a growing trend in retail centers: fitness uses, churches and other non-retail uses taking over big boxes that aren't being backfilled by traditional retailers or grocery stores.”

The city would gain in sales- and property-tax revenue and attract grocery spending from non-Centennial residents, the staff report said. After necessary approvals by the city, construction could wrap up around the end of the year if the project moves forward. The developer could not confirm an opening date due to variables involved in the remodel process, Marciniak said.

The project would remodel a roughly 30,000-square-foot building, of which Alfalfa's would occupy about 24,000 square feet — two existing businesses, Biryani Pot, an Indian restaurant, and Spa Brokers, a seller of hot tubs, spas, saunas and fireplaces, occupy the other 6,000 square feet. The project aims to feature a trendier exterior look, with repainted walls and a veneer-wood accent at the corners closest to Quebec Street. A main draw could be a “community meeting” area with a multi-use outdoor space, interior café/community room, and a demo or prep kitchen for culinary classes and educational events, according to the city's agreement with the developer.

“The indoor-outdoor gathering spaces allow for a variety of functions including group meetings, community events, a community garden and health fairs,” the city report said. The area will be part of the store but is intended to be a free meeting space, Marciniak said.

The $500,000 total the city promised in its development-incentive agreement isn't free money — Alfalfa's would be required to remodel the building's exterior much more thoroughly and according to its proposed design. All development-incentive agreements are performance-based, meaning the city doesn't pay up-front, but rebates some of the tax revenue the store generates if the conditions of the agreement are met.

“The city considers incentives for significant projects that will have a positive impact on the community,” Marciniak said.

City council approved an incentive agreement for a new Natural Grocers on East Arapahoe Road near South Peoria Street in 2017, Marciniak said. The monetary amount for Alfalfa's is “in line with projects of similar size and scale,” he added.

Neil Lipson, a Willow Creek resident, attended a meeting with Mayor Stephanie Piko, the assistant city manager and city planners, he said.

“I think (the Alfalfa's) would be a great addition,” Lipson said. “We did discuss trying to create a fully coordinated development on both sides of Quebec. The east side, Willow Creek Shopping Center, is still struggling in areas.”

Lipson praised the proposed outdoor patio area, too.

“That would also be a welcome addition,” Lipson said. “I think the store will get plenty of business from the neighborhood.”

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