A TOUGH MARKET

Is Central Market’s Oak Cliff land purchase the beginning of a new era?

By RACHEL STONE

Photos by DANNY FULGENCIO

Dallas/Fort Worth has one of the most competitive grocery markets in the United States.

In the corridor between McKinney and Little Elm, nearly any chain you can think of has a presence. Grocery companies, from Aldi to Whole Foods, have purchased about every corner along U.S. Route 380.

In Lakewood, Tom Thumb recently opened a swanky new store 1.4 miles away from rival Whole Foods. Neither of those stores is more than 4 miles from Kroger’s flagship Dallas store on Mockingbird Lane.

As with everything, the story is a little different on our side of the river.

Aldi opened two Oak Cliff locations in 2010. But the last time our neighborhood attracted a major supermarket chain was in the previous millennium. Houston-based Fiesta Mart built stores on Jefferson Boulevard and on South Lancaster Road in 1993 and ’95 respectively.

Last year, the City of Dallas offered a $3 million incentive to grocery companies willing to build a store in the food desert east of Interstate 35 in Oak Cliff, but there were no takers.

And then this past August, Central Market purchased land in the Bishop Arts District, on West Davis Street at Beckley Avenue, adjacent to where Crescent Communities is building an apartment complex. While the San Antonio-based retailer, whose parent company is H.E.B., has said they have no immediate plans to build there, it is one of the few signs of interest from any major retailer in the southern sector of Dallas in decades.

Kroger has eight stores in Dallas, but the one at Wynnewood Village Shopping Center is the only one south of Interstate 30. Fiesta Mart built its store on Jefferson Boulevard in 1993.

Why is Oak Cliff such a hard sell for grocers?

That comes down to the tricky business of selling groceries as well as the demographics of our neighborhood.

The average profit margin for grocery stores is about 1 percent.

“It’s a very high-volume, low-margin business,” says Will Adams, a real estate broker who has worked with grocery companies. “That’s why they’re so careful. Because it really can affect the bottom line of these companies.”

Grocery companies know their customers down to the nitty-gritty. When considering real estate, they might have as many as 200 demographic data points that must match before they’re willing to make a deal.

While those specific data points are proprietary and generally a mystery to

By BRENT MCDOUGAL