Kresge’s to Kmart: A century in Cedar Rapids

Judge N.M Hubbard had just purchased the Waterhouse Building on the corner of First Avenue and South Third Street when he died in June 1902.

The property, known at the time as the Taft Corner, was occupied by the successful John Taft Co. dry goods store.

On July 29, 1911, the Killian Co. became the successor to the Taft Co. store, and the Hubbard building became the first home of Killian's in Cedar Rapids.

When the Killians (father Edward, son James and Edward's brother, A.L.) decided to move to Third Avenue, S.S. Kresge Co. signed a lease on the Hubbard building on May 5, 1913.

The new Kresge's was the 108th store of a chain with its headquarters in Detroit. The building was remodeled with new fronts and show windows and a modernized store room.

At that time, there was a Kresge's in Des Moines. Mainly an East Coast company, Kresge's presence was fairly new to the Midwest. There were stores in Chicago, Kansas City, St. Joseph, Mo., Springfield, Mo., and Milwaukee. The stores did 5-cent and 10-cent business, with any article in stock sold at those prices.

The Cedar Rapids Kresge's sustained $1,000 in damage in May 1919 when the Douglas Starch Works exploded.

Just a few weeks later, fire broke out in a paper bin in the rear of the store's basement. About 60 employees escaped, saving only the cash registers. The fire was quickly contained. Hubbard had insurance to cover the $3,000 to $5,000 in damages to the building, but damage to merchandise had to be appraised. The Kresge store announced that employees still would be paid as if the store were open.

In 1924, the red front of the Kresge 5-cent to 10-cent store was joined by the green front of the Kresge 5-cent to $1 store. To accommodate the additional store, Kresge's purchased additional space.

In 1948, S.S. Kresge Co. removed the two floors above its retail space, converting the structure into a one-story building, and merged its two units together into one large, self-service sales floor. That same year, the Kresge fountain was added.

The last tenant in the building's third floor was Tru-Art Engraving. The company moved in 1941 when the floor was deemed unsafe for heavy machinery. The second floor had been vacant for a few years.

When the S.S. Kresge Co. celebrated 50 years from the opening of its first 5-cent and-10-cent store in Detroit in 1949, there were 700 stores throughout the United States and Canada.

Sebastian Kresge was 81 that year and still the chairman of the board. The 92 local employees were eligible for free insurance, vacations up to four weeks with pay, pensions, Christmas remembrances and opportunities to win cash through a suggestion system.

With Lindale Plaza's opening in 1960, Kresge's opened a branch there as well, but the company was discovering that its profits were coming from its newly developed Kmart discount stores. The Lindale store closed at the end of 1976.

Kresge's closed its downtown store on Dec. 31, 1965, reopening as Jupiter's Discount, a division of Kresge that was used to fill a store space until the lease expired. Jupiter's closed after four years when Kresge's opened its first Kmart store in Cedar Rapids.

Opening day was Nov. 13, 1969, in the Kmart-Cedar Mall Shopping Center at 2727 16th Ave. SW.

It was the 323rd Kmart worldwide, but in Iowa it was the sixth and, at 117,000 square feet, the largest. The store employed 175 full-time in 62 departments, which included a supermarket, a building materials store, sporting goods, major appliances and automotive services.

Merchants National Bank bought the Jupiter property across the alley from its main building in 1970. The property had 100 frontage feet on First Avenue, 80 feet belonging to the Hubbard family, the other 20 feet owned by S.S. Kresge.

The bank dedicated the city's first "environmental parking lot" on the site in June 1973. Part of the city's urban renewal project, it had 40 parking spaces, a bicycle rack, trees and artificial grass.

The largest discount department store chain in the world in 1969, Kmart had opened some 60 stores that year and planned the same for 1970.

One of those was the east-side Cedar Rapids Kmart, which opened on Nov. 19, 1970, at 180 Collins Rd.

When Jack Jacobs petitioned the City Council for a rezoning for the Kmart shopping center, in June 1969, the property was not yet annexed to the city. Jacobs knew that when it was annexed, it would automatically be zoned R-1 (single-family residential).

Kmart stores accounted for more than half of Kresge's sales volume of $1.7 billion in 1968. To keep prices competitive, the home office set prices on Kmart merchandise. Local managers were allowed to lower prices on some items, but they were never allowed to raise prices.

In business for 70 years at that point, the S.S. Kresge Co. operated 1,000 Kresge, Kmart and Jupiter stores in the United States, Canada, Puerto Rico and Australia.

The corporation faced change again in 2005 when Kmart bought Sears, Roebuck & Co. for $12.3 billion, combining two retail icons into the third-largest retailer in the nation, with sales of $55 billion. The entity that resulted was called Sears Holdings Corp. Its board was comprised of seven Kmart board members and three from Sears. Each business, however, retained its own brand. That year, Cedar Rapids had its two Kmarts and a Sears store at Lindale Mall.

The 16th Avenue Kmart closed in 2012; the Collins Road one will close this year, ending Kresge's presence in Cedar Rapids after 100 years.