Investor: Kroger missed chance to buy 'linchpin' property for new store

January 3, 2013
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Kroger apartments IndyThe owner of a row of three 1930s apartment buildings—which Kroger claims are standing in the way of a new store at 16th Street and Central Avenue—says he tried for months to sell the buildings to the grocery chain for a total of $175,000 but never got an answer. Aaron Adams, who said he bought the vacant properties on behalf of an investor in May 2011, waited to hear back from Kroger for almost a year before he began a rehab of one of the four-unit buildings in March 2012. "They never really wanted it," Adams said. "They're just using it as an excuse." A Kroger spokesman told IBJ in late December that the three apartment buildings are the "linchpin piece" of a long-simmering plan to replace a worn-out, old-format store along 16th Street. Adams said he spent about $180,000 to gut and renovate the first building (shown above, with frontage on Central) and plans to start work on the other two, which sit behind, this month. He said a Boston investor has agreed to buy all three for about $400,000 and finance the renovation of the two that remain untouched. (Adams even listed the properties on the MLS with an asking price of $385,000; an archive version of the listing is available here.) Adams said his investor, who he declined to name, has agreed to pay about $250,000 for the renovated building and $75,000 each for the other two. Adams' Alpine Property Management will handle leasing and management. Kroger spokesman John Elliott said the chain's new district real estate manager has spoken with Adams and instructed a broker representing Kroger to keep working toward a potential deal. Elliott insisted the chain is "serious" about buying the land necessary to redevelop the corner. With an eye toward redevelopment, the chain over several years acquired parcels including at the northeast corner of 16th Street and Central Avenue and a narrow strip behind its existing store."That store is a top priority in the Indianapolis market," Elliott said.

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  • Stay out of my wallet
    If Kroger ever does buy this property, I don't want to see one dime of public money go into supporting their redevelopment.
    • Step Up Mr Kroger
      Kroger can easily pay the new price. Look what CVS and Walgreens will pay for a good corner. Kroger needs to be sensitive to the neighborhood and design an urban style building sympathic to it's urban environment.
    • OOPS
      Make that sympathetic, not sympathic!!
    • Squandered Opportunity
      This push has been going on for sometime and I appreciate Cory following through and bringing attention to the project. The bottom line remains, Kroger is not serious about the project for a several reasons. First, their national vision of revitalization requires or has required gas stations at all new or renovated stores. Further, Kroger rarely entertains frontage design suggestions or requirements at any of its projects. Third, the landowners at these properties were a little high in their demand prior to their renovation. Fourth, King Park Development's frontage, second story, and no gas station requirements, tied Kroger's hands while it pushed more lucrative and amicable renovation, for example, in Nora and elsewhere around the city. Fifth, Indianapolis now has one of the highest grocery store to population ratios in the country, downtown, in particular, with a new O'Malia and grocery store to come at Illinois and Vermont. I suggest everyone do the following: Congratulate the landowners on their revitalization project. Kroger should take advantage of the option to purchase or acquire the remaining parcels available from King Park. King Park should agree to allow Kroger to seek gas station approval at the adjacent and vacant NW corner of Central and 16th or the NE corner, so long as Kroger revitalizes or somehow assists in the redevelopment of the NW corner. Kroger should buy into a herron-morton facade design but should not have to agree to business or apartments above its store. Ultimately, Kroger is a business and needs its common procedures and practices to maintain a healthy bottomline. That said, as a former Bloomington native and neigbor to the highest grossing Kroger store in the nation on College Mall Road, revitalization and incoming surronding business will be a boone to the neighborhood and Kroger as the leading midwest grocery store. Good luck! I live in the neighborhood and while a gas station, or more appropriately stated - pumps for Kroger customers, is not all that enticing, if it incentivizes Kroger to conceed facade design and box location, it will greatly improve the neighborhood and its economic development.
      • It is a Cash Cow
        At one time, I used to manage an inner city grocery store in another city. Since the closing of the store on east 10th Street and the Save-A-Lots around the area, the store at 16th and Central is a cash cow for Krogers. Living in the area, my understanding from the surrounding residents, isn't as much the design as it is, that they do not want a gas station next door to them. Anyway, it seems Marsh is taking the lead on gaining / developing in downtown Indy anyway. Thank you Marsh.
      • Wait A Minute...
        Hold on here... The property lies within the Herron-Morton Historic District, right? Or am I off on the boundaries? The apartments can't be torn down, if IHPC is to stand for anything. That's the point of an historic district. The question of an appropriate new use for the grocery site is a completely different matter.
        • Not IHPC
          Unfortunately, Joe, the NE corner of 16th/Central is the only one at that intersection not governed by IHPC. Both corners south of 16th are Old Northside. NW is Herron-Morton. NE is not protected.
          • But...
            ...it does have that unique PK-2 zoning, which says that bascially anything could be permitted, as long as its compatible with being near a significant park, but it's all up to the discretion of the MDC. While that wouldn't actually prevent an owner from tearing down the apartment buildings, it wouldn't seem a wise financial decision to demolish the buildings prior to having approval for a redevelopment.
          • Thanks
            Thanks for the correction! That is unfortunate.
          • Look to Louisville
            Google (map) Kroger, 520 North 35th Street, Louisville, KY. No gas station, two-story entry facade, building set up to the street. They CAN and DO build buildings like this.
          • re thundermutt
            I don't disagree with the sentiment, thundermutt, but that Kroger has a gas station; it just happens to be north of the street rather than in Kroger's parking lot per se. That said, the Kroger in Bloomington (not the College Mall Road store) doesn't have a gas station, so maybe take that model, add in a two-story facade on the street, and put it in Indy.
          • NICK IS AN EXCELLENT ANALYST
            Reading Nick's analysis was very beneficial. Nice job.
          • wow
            I lived in a house that is nearly identical to this one on Park Ave. They must of had the same builder.
          • HMP
            While the property does lie in Herron-Morton Place that side of Central is not in the historic district. Although Kroger may not be serious about the renovation of its store, Alpine Property Management has a history of self service and you can be sure they have done their part to slow this process.
          • Louisville and Savannah
            The Kroger on Bardstown Rd in Louisville is built closer to the street with fake facade to look like older stores. The Kroger in Savannah's historic district mimics the old cotton exchange. They can comprimise if it suits them.
          • Louisville and Savannah
            btw, neither of these have gas stations.
          • Wrong Concept
            The idea isn't that the building should simply look urban. The development should be a useful addition to the urban fabric. CVS has a fake 2nd story at 16th and Meridin and the building is one of the worst additions to the city. It doesn't do anything for the community to have a pretty building. To me, it makes sense for Kroger to actually build a 2 story building. They can place their offices, break rooms and other non essential items on the top floor. Obviously a vast majority of the store would be on the first floor, not that it has to be. The example brought up in Louisville on 35th street is a joke. It isn't built to the street, has little to no activation with the street, and the false 2 story facade is simply a suburban "entrance feature".
            • Neighborhood boundaries
              The Kroger actually lies within the Kennedy-King Neighborhood boundaries, not Herron-Morton Place.
            • not another L'ville 35th St store please
              The 35th Street store mentioned above doesn't even have a connection from the bus stop/sidewalk to the front door. As Joe said, we can and should demand much, much better than that. http://goo.gl/maps/5U1lf
            • CVS
              The 16th/Meridian CVS actually does have a mezzanine/2nd story over the north 1/3 of the building (over the pharmacy and storage area). The Kroger at 10th & Shortridge also has a mezzanine/2nd story over the front end. Also, Joe, a good urban grocery is an addition to the urban fabric. Maybe there's no awnings and windows against the sidewalk, and no apron-wearing shopkeeper sweeping the walk, but in the modern world a grocery does add to a neighborhood. For example, the Lockerbie O'Marsh doesn't exactly add streetlife to Alabama or Vermont (or New Jersey or New York), but it definitely adds to the neighborhood fabric.
            • Kroger
              Idyllic...check those Google aerials again. There is most definitely a sidewalk to the doors. It is set up the hill on 35th to function as an ADA ramp, since the store is set to match street grade at its rear. (Walgreen's at 16th/Meridian has a similar setup.)
            • 35th St
              Okay Thunder, it appears in the aerial photo that they moved the bus stop shelter south to be closer to the walkway from the sidewalk to the store. It's still not a very direct connection. Can you imagine them building a parking lot where the customers had to walk out of their way to acutally get to the store entrance? Of course not. It should be even more important to minimize pedestrian travel distance. Overall, it's a pretty poor urban design. The downtown O'Marshia would be much better if it had an entrance on Alabama, but it does at least provide some visual interest and natural surveillance by having windows that can be seen into from the street (albeit they've covered up some of them a bit too much).
            • And then... reality
              Have any of you ever been to the "Fellini Kroger", as we call it? Some use other, more charged terms. That place may be a cash cow near the 30th (or whenever benefit checks are issued) but I'm sure Kroger has put some thought into how they will integrate the armed guards, the wheel-lock carts (which will be turned into go-karts in about 3 minutes without the locks) and the 26 security cameras they will need to keep the armed robbery crews out of the parking lot. Now, why would they be delaying the 'gentrification' of this property?
            • Thundermutt
              I can't agree more that a grocery store is crucial to the development of a neighborhood. However, a grocery isn't defined by a massive suburban site plan and inflexible design. The manner in which a store connects to the physical environment is just as important as what is in the building. I am a firm believer that people are greatly impacted by the environment around them. If we continue to allow substandard developments to dot our community, then it becomes the norm. Take for instance the canal. Most development on their is far less supportive of an active neighborhood than it should be. So when Tom Developer comes along for a 15 story residential tower, residents of the much lower density Water Mark subdivision and area apartment complexes complain about people and views and traffic..........
            • Don't Worry
              Needn't worry, little man. The Simons and Lillys and Irsays have sucked the local public development coffers dry.
            • KROGER
              I just drove by the Kroger on W 86th this afternoon and they have installed a huge canopy to cover their new gas station. It is so big that it actually will block the view of the Kroger store. Gas appears to be a BIG part of their business plan.
              • Let's face it: Indy can't handle urban concepts
                I totally agree with Idyllic and Joe. Unfortunately, it is of no interest for Kroger or the majority of the Indy public to have enough vision for an urban concept for this ideal location on 16th & Central. There are many mixed use developments incorporating residential around (or in this case fronting 16th street) the grocery store. Parking should be on the north side of the store with the main entrance, which would open up to King Park and other residential units to the north. This layout would blend in naturally with the surrounding neighborhoods but more importantly deter crime. A rooftop parking deck (like Fresh Market) would be ideal but do we really have time to wait 20 more years? I really believe the Old North Side, Herron Morton, and YES King Park residents all deserve a development that fits in with the community... rather than an idyllic, pretty facades that don't fit into a developing urban fabric.
              • good luck
                The article mentions that the investors who own the other 2 apt bldgs want to renovate and then rent them. I drive past them everyday on the way to work and based on simply visual inspection of that area, good luck to them in trying to rent them out. They are hidden, next to a couple of dumpy houses and next to this Kroger that does not have the greatest group of people hanging around it and in the back of it.
              • Ben.....
                Ben, If priced correctly, these apartments will be rented out in no time. This is a very desireable area and while patches see vacant lots and yet to be revitalized homes, the area as a whole is a strong draw for renters owners and businesses.
                • Ben
                  Hey Ben, I guess you can thank your 'local' Kroger for not willing to develop properly to make this 'dumpy' area more desirable. Great observation on your part!
                • Clarification
                  The "dumpy" houses are fairly common in the near northside neighborhoods. Anyone who drives down Central, Delaware, College between the interstate and Fall Creek sees this. The unfortunate issue is that these are good neighborhoods and for whatever reason a few bad apples are still standing around. I believe I read that Indy has among the highest number of abandoned homes in the midwest. Indy is better than this and we need to do something about it.
                  • WELL STEP UP KROGER!
                    Well, unfortunately Kroger has no interest in the community and will stall progress for the near northside neighborhoods once again. Ben, can you name 5 businesses that have opened in the last 5 years between 16th street and Fall Creek? Yes, thank you Kroger for nothing.
                  • District
                    The property lies within the Herron-Morton neighborhood boundaries, but NOT the historic district. The historic district boundary is the center of Central Avenue.
                  • with respect to beautifying this area
                    How about tearing down the old gas station bldg on the NW corner of Central and 16th and maybe condeming (broken windowns, falling apart, etc.) the apt bld on the southside of 16th just west of Central? I think these actions would be helpful for that area
                  • Get a Grip
                    To say that Kroger is wanting to expand is laughable. They have a cash Cow as many of you know. Ever go into this Store on Food stamp Day. Kroger jacks up the price on Darn Near Every Item. During the rest of the Time,our illustrious Money Citizens don't even go in this Store. I have yet to see (pardon me) a White person(affluent) go in.Kroger people a slick! Don't be fooled. They want a bigger Store,yes from you the Tax Payer, preferably FREE!

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