CARY – A consultant working with the village said he believes Jewel-Osco can operate stores in Cary and Fox River Grove, but Cary will need to continue to engage in conversations with the grocery chain.
Mike Mallon, the senior vice president of DK Mallon, a Chicago area retail real estate company, spoke with officials from Jewel-Osco and representatives of Cary Square Shopping Center, on behalf of the village, at a recent conference in Las Vegas.
Mallon told Cary Village Board members this week he expects Jewel to exercise its option in September to extend its stay at the shopping center through 2020. He added that it doesn't mean Jewel has to stay open.
The Cary location is 48,000 square feet, but the Jewel's prototype location is 62,000 square feet. Mallon doesn't expect to see an expansion of the store, but it is overdue for a remodel, he said.
Mallon said he does believe Jewel will try to get some sort of financial advantage, such as reduced rent, and might look for some sort of financial assistance from the village to a stay longer than five years at the shopping center.
The ownership of the shopping center does want a long-term deal with Jewel, Mallon said.
Mallon did say there are things communities can do to help spur development, or redevelopment or help the business. He suggested shared sales tax agreements, setting up a TIF district, waiving permit fees, providing tax incentives or streamlining the redevelopment process, among other things.
"It's important, if you do go ahead and provide any type of assistance, that you get something back in return," Mallon said. "There has to be perceived benefit."
Cary officials started asking about Jewel's future in the village after the grocery chain announced its plans to open mid-summer in the former Dominick's location in Fox River Grove.
A Jewel spokeswoman has said that the grocery chain plans to operate both locations.
Mallon said he expected Jewel, and its parent company New Albertsons, to monitor the performance of both stores.
Mallon estimated that when Dominick's and Jewel operated, the two stores did a combined $50 million in revenue. He added the Fox River Grove grocery store draws more people from the east than it does from the west.
"It is my belief .... that there certainly is a market to operate both stores effectively," Mallon said.
Mallon did suggest the village continue to engage in conversations with Jewel-Osco.
"They're not going to show their hand on their option, until they have to," Mallon said. "I think right now there's an opportunity to engage them in the conversation, at least be able to get smarter, and be able to put something together that works for all the parties."