Friday, May 9, 2008

A closeout for Wal-Mart

More about the story about Wal-Mart not coming to the Chatham neighborhood from the Tribune:
Wal-Mart Stores Inc.'s hard-fought battle to turn Chicago into a beachhead for urban expansion across the country has come to a quiet end, at least for the foreseeable future, as big-city politics held sway over low prices.

Now the world's largest retailer is turning its attention to a backup plan of opening stores just outside city limits, banking that thousands of low-to-middle-income city dwellers will travel to collar suburbs to shop at the discount store. Among the suburbs Wal-Mart is looking at are Calumet Park, Cicero and McCook, according to people familiar with Wal-Mart's plans.

Wal-Mart got the word from city officials last month that Mayor Richard Daley doesn't want to risk a messy showdown with unions over Wal-Mart—like the big-box store battle of 2006—while Chicago is still in the running as a host city for the 2016 Olympics, according to people familiar with the matter. The International Olympic Committee is slated to make that decision in October 2009.

"That's the end of the story, at least for the next two to three years," said John Melaniphy, a Chicago-based retail real estate consultant. "I think in the long run they'll end up in the city one way or another, but it's going to take them a long time."

Goldman Sachs Group Inc.'s development arm, Archon Group LP, isn't waiting. The Chicago-based developer of Chatham Market on the South Side, where Wal-Mart had hoped to open its second city store, put a "For Sale" sign on the property last week.

Lowe's Cos. has already opened a 117,000-square-foot anchor in the shopping center at 83rd Street and Stewart Avenue. Wal-Mart was slated to be the second anchor and Archon had counted on the discount chain to attract other retail tenants. The developer has not been able to find another anchor to replace Wal-Mart.

"We're doing this to see what options present themselves," said Bill Moston, director of retail investments for Archon in Chicago. "We have a responsibility to pursue all available options and to evaluate what they are."

That could mean the empty land would go for other uses such as office space or storage or housing.

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