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           July 30, 2011

   

Some Detroit grocers open up Shop without Incentives

 

 


Patty Atisha, owner of Lafayette Foods, left, talks with customer O'Deal McGruder of Detroit

DETROIT FREE PRESS BUSINESS WRITER

The coming of Whole Foods to Detroit's Midtown raises anew the question of who gets lucrative incentives to open a shop in Detroit and who doesn't.

Chaldean grocer Patty Atisha and her family opened their third grocery store in Detroit in June, the 13,500-square-foot Lafayette Foods in Lafayette Park, with no incentives or financial help from the city.

She says her family has operated groceries in Detroit since 1987 and knows how to make it work without incentives.

"It would be nice if we could get some, but we feel we can do it on our own," she said Thursday. "We didn't chase it, and nobody came to us saying 'These incentives are out there, either.' " However, city officials did work with the store on permitting and other issues.

So far, no incentives have been approved for the Whole Foods project, which as announced Wednesday will see a 20,000-square-foot Whole Foods open in 2013 on a site north of Mack Avenue between Woodward and John R. But the local Chaldean News reported that the Whole Foods project could qualify for between $4 million and $5 million in tax incentives and foundation money.

Whole Foods spokeswoman Kate Klotz said that the company would get no incentives from the city, but acknowledged that Ram Realty Services, the real estate developer handling the project, may be getting some that would make the deal more financially feasible.

In Detroit as in many cities, tax breaks and other incentives typically go to major projects, like the restoration of the Westin Book Cadillac Hotel, or to lure unique retailers, such as Whole Foods. Austin, Texas-based Whole Foods offers upscale organic food sought by many shoppers. It operates several stores in suburban Detroit.

Citing the important benefits of the new retailer, Sue Mosey, director of the nonprofit group Midtown Detroit, said Thursday that the Whole Foods store would create more jobs in the city and send a clear signal of confidence in the city of Detroit to other national retailers.

"But the best reason of all," Mosey said "is that it eliminates the age-old question of where do I shop when I live in the city of Detroit?"

Atisha said the notion of a food gap in Detroit is greatly exaggerated.

"We carry organic stuff, natural gluten-free, dairy-free items here, too," she said. "We're definitely not a Whole Foods, but for a small store in the city, we carry a lot of fresh items, great items, too."

As for the incentives, she added, "It's a little unfair, but I guess the squeaky wheel ... "

Economic development officials defend incentives as crucial to winning business that would go somewhere else without them. Officials point to deals like the reopening of the Book Cadillac, which stood vacant for more than 20 years before a complex financial package including multiple layers of investment tax credits and other aid made the deal possible.

George Jackson, president of the Detroit Economic Growth Corp., noted that his agency's Green Grocer Program, initiated in May 2010, works with local grocers to bring fresh food to the city. So far, the program has worked with 12 independent grocers on initiatives and facilitated more than $800,000 in grants and loans to Detroit grocers. Details of the program are available at http://greengrocerproject.com.

"Without a public-private partnership under the auspices of the Green Grocer Project, this deal would not have happened," Jackson said of the Whole Foods deal.

Art Papapanos, vice president of the DEGC, added that incentives also give the city and state an edge in the national competition for relocating businesses.

But Auday Arabo, president and CEO of the Associated Food and Petroleum Dealers, said there are 83 full-service grocery stores operating in Detroit without incentives from the city.

"Competition is a good thing, but we want to make sure it is on a level playing field," he said.

 

 

 

 

 
 

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