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Pick 'n Save closing to leave 'food desert' on south side

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Neil Johnson
Monday, September 11, 2017

JANESVILLE—Janesville south side resident Gary Kontny said Pick 'n Save's closure in November will leave him with scant choices for grocery shopping.

He said it means he'll have to drive to Beloit or Janesville's north side. Either option would entail a half-hour round trip, and that's as long as he's got wheels.

The 65-year-old Kontny, who has lived on the south side his whole life, has progressive rheumatoid arthritis. He's unsure how much longer he'll be able to drive.

He's shopped at Pick 'n Save almost exclusively for years because it's close to his house.

“At some point, probably sooner than later, I will be in an electric wheelchair. I was so happy to have a grocery store nearby. I could get there. For me, not having this (Pick 'n Save) nearby, it's going to be absolutely devastating,” Kontny said.

Pick 'n Save's planned closure in November will leave Kontny and thousands of residents on the south side without access to a major, fresh-food grocer nearby. The store is the only full-service grocer on the south side, and city officials say its closure in the near term will create a sizable food desert on the south side.

On the north side, Janesville is flush with more than a half dozen supermarkets and grocers. That's small consolation for south side residents who might have a harder time making the trek across town for groceries compared to a trip to a grocer just down the street.

It's not clear what might come next for the 120,000-square-foot store at 1717 Center Ave. that Pick 'n Save plans to vacate.

In the days since Pick 'n Save's parent company, Roundy's, confirmed the store's closure earlier this week, city Economic Development Director Gale Price said at least one local commercial real estate group already had reached out to owners of the store property.

“We're trying to find out what their game plan is,” Price said.

Price said the city wants to press for some sort of grocery store for the property, even if it's a grocer that runs on a smaller scale.

“You'll have well over a mile radius with no grocer, and that's a food desert, for sure. That's a big deal. We need it backfilled for the community's sake,” Price said.

Price said it's not clear whether Pick 'n Save still has an active lease with the building's owner, Oak Creek-based NDC Commercial Real Estate. The Gazette was unable to reach an NDC property manager for comment.

The owner doesn't appear to have restrictions on reuse of the property, a Roundy's official indicated this week.

In June 2017, Roundy's closed two Pick 'n Save locations in the suburban Milwaukee communities of New Berlin and Pewaukee. Unlike the Janesville store, both of those locations were within a few miles of other existing Pick 'n Save stores.

Those stores were closed, Roundy's spokesman James Hyland said, because the “long-term financial performance” of the stores didn't meet the company's goals. That's the same reason Hyland cited in a statement to The Gazette this week explaining the Janesville store's planned closure.

Of all Janesville's grocery stores, Pick 'n Save is the farthest-flung from the north side retail corridor along Milton Avenue and Highway 14, the location of the city's heaviest concentration of grocery stores. The market got even more packed in April 2015, when Festival Foods opened a new, 70,000-square-foot store at the site of a defunct K-Mart at Milton Avenue and Highway 14.

 

David Livingston, a Milwaukee-based grocery industry analyst and a former Roundy's market research manager, said the Janesville Pick 'n Save has had a long history of scuffling for customers in the city's ultra-competitive grocery market.

“As I recall, the (Janesville) store's never done very well,” Livingston said. “Population density, competition, there are a number of reasons why it's not working. Bottom line is it's not working out for them, and they're now moving on. They don't see any light at the end of the tunnel for that (location),” Livingston said.

“The competition in Janesville is very strong. The pricing is very competitive. If you've got Wal-Mart, Woodman's, an Aldi and a Festival in a community, nobody's going to have to complain about overpaying for groceries,” Livingston said. “At the end of the day, it all evens out. Festival comes in, and Pick 'n Save goes out. It's a zero-sum game.”

Livingston said vacant supermarkets in the region often are retrofitted and cut up into smaller spaces for reuse as minimalls. The uses can range from bargain stores to fitness centers or even churches, but less often do the vacated stores become grocers again.

“They try to get anything they can to come in, and it's usually lower-rent tenants. It doesn't end with a pretty picture,” he said.

Price said the city's market research suggests the proportion of home-ownership and long-term residents on the south side represents an ample market for a full-service grocer. He believes a vacant building already set up as a grocery store would be attractive.

The city estimates there are about 3,000 households and about 7,300 people who live within a mile of the Pick 'n Save store, according to a third-party analytical tool that the city uses for market research.

The analysis is based on the most recent U.S. census data, and doesn't include the population in that area of Janesville that lives in group homes such as skilled nursing facilities.

The analysis shows that in the area surrounding the store, median household earnings average about $48,000, which is less than the state's median for household earnings, $53,000.

Price said if a new grocer did move in at the Pick 'n Save, it likely would be a smaller to mid-size store.

“I just don't think you're going to see a giant store there. It's more likely it would be an 80,000- to 100,000-square-foot grocery, with the balance divided off for another tenant,” Price said.

“That's OK. I don't' think that's a bad thing.”

This story has been modified to include market data provided by the city of Janesville.   



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