Cedar Rapids officials continue work to draw new grocer to shuttered First Avenue Hy-Vee

CEDAR RAPIDS — The city of Cedar Rapids is keeping the pedal to the metal as it works to attract potential retailers to fill a vacant Hy-Vee storefront 18 months after the store’s closure created a downtown “food desert.”

Cedar Rapids Economic and Development Services Director Bill Micheel on Wednesday said city staff are working with two separate grocery chains to set up tours of the building at 1556 First Ave. NE.

The goal is to hold those tours within the next two months, he explained, although outreach to other potential operators will continue in the meantime.

“We certainly don’t want to see that store continue to sit vacant,” he said. “I’ll speak for myself when I say that my personal goal is that we see a ribbon cutting (there) at some point in 2026.”

Recommended Reading

‘Something has to change’: City plan calls for increased focus, growth along First Avenue

Micheel on Wednesday presented that and other updates to the Linn County Board of Health, which has taken interest in the situation given its impact on food access for a large swath of downtown Cedar Rapids residents.

Hy-Vee closed its First Avenue store in June of 2024 after the location had reportedly failed to meet the company’s sales goals for “several years.” The downtown store had been in business since 2002, and Hy-Vee most recently renewed its lease on the space in 2023.

The closure presented challenges for the surrounding Wellington Heights and Mound View neighborhoods, and elected officials and community members alike raised concerns about a growing “food desert” in the area.

Micheel said that concern lingers 18 months later, despite the opening of a handful of more specialty grocers in the area such as the recently opened Hornbill Asian Market at 1445 Fist Ave. SE.

“We’ve seen some things that fill some of that gap, … but there is obviously still a need for a full-service grocer in that area,” he said. “I’d have to look up what the exact definition of a food desert is, … but this doughnut hole (around the former Hy-Vee) would certainly qualify.”

Since Hy-Vee’s closure, Micheel said the city has courted several potential retailers with the help of the Independent Grocers Alliance, a nationwide grocers’ network more commonly known as IGA.

Those efforts led to some promising leads, but Micheel said that for one reason or another, none have taken the final step to officially seek tenancy.

  Buy Photo

The city last year was in conversations with an interested Kansas City, Mo.-based grocery chain, for example, but that effort was ultimately stymied when the city did not receive a federal grant that would have helped cover equipment costs associated with the project.

More recently, the city has been working with a Nebraska-based grocer. While “very interested” in the space, Micheel said the group ultimately told the city it did not have the capital to move forward with the acquisition at this time.

“What I told them was ‘We’re going to move forward (with other outreach). Once you get to a place where you have capital available, let us know,’” he said. “If the store is still available, then fantastic … but we don’t want to wait.”

The city has since continued with its outreach efforts in conjunction with IGA and with additional assistance from the Associated Wholesale Grocers distribution group. Those efforts led to the connection between the city and the two chains with which it is arranging tours.

Micheel did not name either chain, but said one is based in Oklahoma and the other in Arkansas. Both have expressed interest in expanding their footprint northward.

  Buy Photo

Comments: grace.nieland@thegazette.com