Reading grocery store project at a second standstill

Dec. 6—The construction of a retail and wholesale grocery in Reading has hit another snag.

The developers of a Super Natural & Fresh Produce at North Fourth and Elm streets now say they need another $1.5 million to continue work, City Council President Johanny Cepeda-Freytiz said.

Announced in 2018, the project resumed in May after a nearly two-year delay, largely blamed on labor and materials shortages associated with the pandemic.

"Now, inflation has had another impact," the council president said Monday at a committee of the whole meeting.

To make up the shortfall, Cepeda-Freytiz said, local businessman Leopoldo Sanchez and partners are asking the city and county each for $750,000 in American Rescue Plan Act funds.

A representative of the developer was not immediately available for comment.

Previously estimated at $10 million, the project is funded by private investment and loans from the Greater Berks Development Fund and the nonprofit funding groups Community First Fund and Low-Income Investment Fund.

Cepeda-Freytiz said she attended a meeting Monday with interested parties, including city and county elected officials and administrators, lenders, representatives of the Greater Reading Chamber Alliance and others.

"Right now, the project has been at a standstill," she said, asking asked City Council to consider the developer's request for ARPA funding. "There hasn't been any construction, and there won't be any construction unless the owner can come up with $1.5 million."

The city received more than $61 million in ARPA funds and has already allocated $3 million to the Santander Arena, $4.5 million to FirstEnergy Stadium and $4.5 million to city nonprofits. City Council also recently approved $2 million each for Reading's two colleges and university.

"I've been an advocate since day one that we have ARPA dollars allocated (that) we do not forget our small businesses," Cepeda-Freytiz said, "because they're pouring into our revenue base."

If completed, the grocery business, warehouse and associated tortilla factory are expected to create about 120 jobs and bring fresh fruits and vegetables to a food desert area.

A food desert is an urban neighborhood in which it is difficult to find and buy affordable or good-quality fresh foods.

If the project is unable to continue, council members are worried the city may be left with a partially finished and vacant building.

"The last thing that we need is another blighted property," Councilman O. Christopher Miller said. "So I feel it's important that this move forward."

The parking lot and 40,000-square-foot building, formerly the city's vehicle maintenance garage, 229 to 243 N. Fourth St., are considered a brownfield, he said.

A brownfield is a former industrial or commercial site potentially affected by contamination.

The project also includes rehabilitation adjacent residential buildings at 225 and 227 N. Fourth St.

Many partners are involved, jobs would be created and fresh foods would be made available, which are important considerations in the decision making, Miller noted.

Councilman Christopher Daubert agreed with Miller's points but said he is concerned that other businesses and projects be given equal opportunity to apply for ARPA funding, also a concern expressed by Councilwoman Donna Reed.

"I'm uncomfortable in that, my guess is, there are many business people out there in the city that need a hand up and need a helping hand," she said, noting those with the right connections appear to have an advantage. "I think of folks out there who have not either the connections or the ability to come to us, who are just as deserving."

Any business in the city is a benefit, Councilwoman Marcia Goodman-Hinnershitz said, noting all should be treated fairly.

"I'd like to see this business be successful," she said, "but I also want to protect the city investment in it."

Before making any decision, Goodman-Hinnershitz said she plans to consult with the city's legal team to explore means of protecting the government's investment should the project not be completed.

No action on the matter was taken Monday.