After a half-century downtown, City Market throws in the towel

Share this:
March 28, 2005 // UPDATED 1:53 pm - April 26, 2007
By: Jeremy Stratton
Jeremy Stratton

After two years of legal wrestling with their landlords, Brad and Brian Hansen were ready to sign a lease relocating their grocery store, City Market, from Loring Park to North Loop.

Then they read the news: Whole Foods had signed a purchase agreement for the Luther Automotive site at Washington & Hennepin avenues - just six blocks away from 800 Washington Ave. N., the Hansens' chosen locale.

"You can't even imagine how frustrated we are," Brad Hansen said. "We've been working so hard; we were very excited; all of a sudden, we're knocked down to the ground. My head is still spinning."

Brad Hansen said that he and his brother had spent $10,000 planning the relocation and were prepared to sign a lease in a few days. The new store would have been more than twice the size of the current 4,000-square-foot market.

"The window's so short now," Brad Hansen said. "There's no opportunity to pick up and move. We're going to be unemployed for a while."

The blow comes as the brothers are finally closing the book on 18 months of mediation over their current lease. Brad Hansen said the court fight is over, and the 1240 Hennepin Ave. S. store will close June 30.

The store's closing may hit people in poverty the hardest. About a third of City Market's customers receive welfare assistance to buy food, Brad Hansen said; without City Market, they'll have no place close to shop, he said.

"Maybe SuperAmerica," Brad Hansen said. "Until Lunds arrives, the nearest grocery stores are south on Hennepin Avenue: Kowalskis at 24th Street and Lunds on Lake Street."

Oak Grove Grocery, 218 Oak Grove St., is another option near SA, 101 W. Grant St. Both are at least a half-mile away from City Market.

The Hansens' move had nothing to do with a new Lunds store that will rise across Hennepin from City Market's current site. (Construction will begin this summer, said John Pazahanick of Lunds.) Even with Lunds book-ending Downtown (the other is at Central & University avenues), City Market could have found a niche, Brad Hansen said.

However, Whole Foods' arrival killed the Hansens' plans, they say. Adding a twist of the knife: the grocer may not open for years.

Dave Rosenberg, Whole Foods' Midwest marketing director, said a purchase agreement for the Luther site has been signed, but Whole Foods hasn't committed to building a store.

The company "decided it would be a good real estate decision," Rosenberg said, but Whole Foods will do a feasibility study on the site before it decides to build there.

"It could be a number of years" until a store opens, Rosenberg said. "We're pretty particular about design and where we put stores."

Stores take about 18 months to be built and opened, Rosenberg said. Luther officials say their relocation could be three years out.

No matter what the time line, the Hansen brothers aren't taking any chances.

"Downtown's all done [for us] if Whole Foods opens up," Brian Hansen said. "The party's over."

Long history

The party started "50-some" years ago, according to Brad Hansen, when his uncle Del Bauer and then his father Don Hansen owned the market on 13th & Hennepin. (Espresso Royale Caff currently occupies the space.)

"We were weaned on the avenue," Brad said, referring to Hennepin. "We've been in the business since we were old enough to stand behind a register."

The brothers purchased the store in 1997. In December 2003, City Market filed a complaint against Great Lakes Management Company, which manages Laurel Village, after the grocery was ordered to vacate its space by December 2003.

The landlord said the grocers hadn't given property notice to renew their lease.

City Market's nine-count complaint against Great Lakes ranged from breach of contract to defamation.

The case was held up in Hennepin County District Court until July 2004, when Judge E. Anne McKinsey ruled against City Market. The judge ordered the grocery to vacate in 30 days.

The grocer appealed, and has remained in Laurel Village awaiting a ruling.

Brad Hansen said that his customers and employees have been dealing with the store's possible demise for more than a year.

"Are you here for the beginning of the end?" said a passing customer, upon seeing a reporter and photographer in the store.

"No! Don't go!" he added.

"We've always been up front [with employees and customers] that the judge's decision would be coming around May or June," Brad Hansen said.

City Market has six employees, other than the Hansens.

The brothers still plan to relocate, but probably not in Downtown.

In fact, the brothers are looking past Minneapolis. Brad said he's looking in the Northern and Western suburbs, as far out as Rogers and Elk River.

"We're going to get right out of Downtown," Brad said. "We've been beat up to much in the city to keep fighting this."