Residents fight Hy-Vee lease restriction

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BY DEENA WINTER / Lincoln Journal Star

The loss of a library drove Coleen Seng to get involved in her neighborhood in the 1970s.

Today — after 16 years on the City Council and four years as mayor — she is galvanizing opposition to the closing of a grocery store.

Seng and many of her University Place neighbors are worried about the effect the closing of the Hy-Vee at 48th Street and Leighton Avenue will have on their neighborhood.

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Jim Norsworthy returns his shopping cart after buying groceries at the Hy-Vee at North 48th Street and Leighton Avenue. Norsworthy said the store is the closest to his home. (William Lauer)

Jim Norsworthy returns his shopping cart after buying groceries at the Hy-Vee at North 48th Street and Leighton Avenue. Norsworthy said the store is the closest to his home. (William Lauer)

They say it’s Hy-Vee’s prerogative to close the store and essentially relocate to 84th and Holdrege streets.

What they’re mad about is that Hy-Vee’s lease bans another grocery store from moving in through 2013.

They worry that the loss of a grocery store will make shopping difficult for people who don’t have vehicles, depress the neighborhood and reverse revitalization gains.

Seng says Hy-Vee has been a good neighbor until now, and losing the store will be a blow to the “fragile, transitional neighborhood.”

“If it were losing money, if it was in an area where it was not patronized, that would be one thing,” said Seng, who has shopped at the store for years. “But it is a very busy store.”

Last month the University Place Community Organization passed a resolution setting up a “Release the Lease” committee during its annual meeting.

Seng is working with the committee to try to talk to Hy-Vee. Despite sending the Iowa-based company a petition with 50 signatures, they’ve had little response so far.

Hy-Vee’s director of communications, Christine Friesleben, said the lease restriction is “pretty standard” in retail. She said it makes little sense to invest in a new store and then allow a competitor to open up shop in your old location.

Hy-Vee held onto leases with similar restrictions in former stores at 14th and Superior streets and 40th Street and Old Cheney Road.

She said Hy-Vee is essentially relocating two stores — the University Place store and its oldest Lincoln store at 70th and O — when two new Hy-Vee stores open.

The 84th and Holdrege store is tentatively scheduled to open March 18, and the 50th and O streets store is set to open in the fall or later.

The 50th and O store is being built with city assistance — through an urban renewal financing tool called tax increment financing —that Seng’s administration put together. Asked about the irony of that, Seng said the new store was expected to only affect the 70th and O street store.

But at the time city officials were working on the 50th and O deal, there were rumblings that the University Place store might close.

Friesleben said Hy-Vee had hoped to open the 50th and O store at the same time the University Place store closed, so shoppers could go there. But construction of the 50th Street Hy-Vee was delayed in part by bureaucratic hurdles.

“When we made the decision, at the city’s request, to relocate our stores, we hoped they could both be opened at the same time to alleviate discontent of those shoppers,” Friesleben said.

And even if Hy-Vee allowed another grocer to lease the old space, it might be difficult to find one, given the trend toward big stores.

“Release the Lease” committee member Larry Zink said it’s difficult to gauge interest from other grocers unless Hy-Vee relents on the lease, because there are few other suitable locations for a store in University Place.

Hy-Vee is unlikely to back down on the lease restriction, Friesleben said. While change is difficult, she expects people will embrace the new stores once they see their products, selection and convenience.

Crystal Edwards teaches sociology at the nearby Nebraska Wesleyan University, and her students are going to get an up-close look at how a grocery store’s closure affects the neighborhood. Her class will study the impact by conducting interviews and focus groups and attending community meetings.

Edwards said a grocery store closure can be the tipping point for neighborhoods, sending them into a downward spiral. She said these kinds of lease restrictions emerged in the 1970s in such cities as Chicago, and are “essentially responsible for urban ghettos.”

“This is how they get stymied,” she said of inner-city neighborhoods.

Studies have shown that vegetable consumption goes down when neighborhood grocery stores close, she said, because people do more shopping at convenience stores.

Friesleben said she failed to understand how closing the Hy-Vee would send a whole neighborhood into decline, but she understands residents’ concerns.

“Obviously, as a business we want to make sure that those people are taken care of,” she said. “Having made a tremendous investment in the community, of course we want those people to stay shopping with us.”

She said the store may set up a program for people who can’t drive to the new store.

Zink lives a couple of blocks from the University Place Hy-Vee, but he’s already begun boycotting the Hy-Vee for focusing on what he calls “out-of-town, short-term profits.”

Another “Release the Lease” committee member, John Krejci, normally bikes six blocks to the store, but now he’s talking about organizing protests and pickets if Hy-Vee doesn’t relent.

Hy-Vee dealt with just such a scene on Valentine’s Day in Iowa, where more than 40 people rallied with signs and chants outside a store Hy-Vee plans to close in an older neighborhood in north-central Des Moines.

Asked whether she’d join such a protest in Lincoln  if it comes to that, Seng said simply, “Yes.”

Reach Deena Winter at 473-2642 or dwinter@journalstar.com.