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Study Supports Creation of Specialty-Foods District in Columbus, Ohio

Posted on: Monday, 14 November 2005, 21:00 CST

By Mike Pramik, The Columbus Dispatch, Ohio

Nov. 11--The North Market should support an effort to create a specialty-foods district Downtown that would include a Whole Foods supermarket, a study says.

A report by Chris Boring of Boulevard Strategies says that a plan by Columbus developer Casto to build 500 residential units, 185,000 square feet of retail space and 2,000 parking spaces "holds great potential'' to transform the area between the North Market and Neil Avenue.

The project's centerpiece would be a 50,000-square-foot Whole Foods supermarket that would compete with many of the North Market's small businesses. Casto representatives laid out initial plans for the project in the spring.

The project, which would create a cluster of retail stores lining Vine Street, is complex because it involves not only land that Casto controls but parcels owned by others, including the city and Nationwide Realty Investors.

"We are encouraged by the report and intend to renew our discussion with Whole Foods about this being a potential site for their second store in the Columbus market,'' said Bill Riat, a Casto partner.

Riat had no further comment on the report, which Casto, the city and the North Market co-sponsored.

The study noted that the North Market already faces increased competition from a number of specialty-food retailers in the Columbus market. They include Wild Oats, Fresh Market and Trader Joe's, as well as Whole Foods, which in September opened a store on the Northwest Side.

But the Whole Foods proposal got the attention of market merchants: The study said they could lose $2 million of their $7.9 million in annual revenue to Whole Foods.

North Market Executive Director David Wible said that would be a big challenge for the 34 vendors who operate at the market.

"I don't think that the findings of the study can provide any comfort for the current community of merchants here at the market,'' he said. "(The study) has concluded that we could face the loss of 25 (percent) to 30 percent of our customer base.'' However, the report also stated that Whole Foods would bring an estimated 85,000 new shoppers to the district, giving merchants a chance to recoup the $2 million projected decline.

The North Market might have little choice but to cooperate. Boring said that if Whole Foods were to build a store a mile away from the market, instead of within walking distance, it would cost market merchants less -- $1 million in lost revenue -- but it would be nearly impossible to recoup the loss from supermarket shoppers, who would be unlikely to drive a mile to the North Market after shopping at Whole Foods.

"Doing nothing in the face of this growing marketplace of specialty foods is extremely detrimental to the future of the North Market and would not appear to be an option,'' said Bob McLaughlin, the city's Downtown development administrator.

It's not as though the North Market is struggling. Wible said sales have grown steadily in the past five years.

However, the threat of Whole Foods looms large.

Don Ziliak, owner of Pastaria and Sarefino's in the North Market, said the report is "probably not a good thing'' for market merchants. He said he thinks they need to be proactive in seeking other revenue streams. He and partners have opened two restaurants, for example.

"Because it's not definitive yet and ground hasn't been broken, I don't think there's a sense of imminent disaster,'' Ziliak said. "But it's been a concern for me since they announced it.

"To sit here and just wait would not be a good idea.'' Boulevard Strategies' study involved interviewing 64 people who have a stake in the market's success, including 27 merchants. It also surveyed 293 North Market shoppers.

Among the findings:

--Whole Foods would devote 25,800 square feet to goods also sold at the North Market's 17,400 square feet.

--The North Market needs to advertise more to attract more weekend shoppers.

--Nearly 90 percent of shoppers surveyed thought the city should subsidize the market.

The city will provide the market with more than $23,000 this year, Wible said. While the yearly figure has been declining, McLaughlin affirmed the city's interest in helping the North Market throughout the development process.

"The North Market in its role as a public market is terribly important to work to protect and preserve,'' he said.

Boring also suggested that some of the tax revenue generated from the project be invested in improvements to the North Market and the east end of Vine Street. There are a number of other issues to iron out, and there is no timetable for breaking ground on the development.

"I don't think there's any question that it would be good for the Arena District and for Downtown, and also for the convention center,'' Boring said of the Whole Foods project. "The only complexity comes in when you're looking at its impact on the North Market.''

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Copyright (c) 2005, The Columbus Dispatch, Ohio

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WFMI, OATS,

Source: The Columbus Dispatch, Ohio

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