A Celebration shopping center could raze an existing building and replace it with a $6 million-$10 million Publix — just a block away from an existing Publix store.
If it moves forward, the project could create up to 100 temporary construction jobs and roughly 125 permanent jobs.
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GE Capital Corp. foreclosed on the 124,000-square-foot Water Tower Shoppes shopping center on U.S. Highway 192 and Celebration Avenue last year. It notified Osceola County earlier this month that it wants to build a 50,668-square-foot Publix store in the place of a former 33,000-square-foot Gooding’s Supermarket. Sources said if the deal is finalized, the store likely would open by 2013.
The property currently has the former Gooding’s Supermarket space divided into five spaces. Because of that, and the difficulty it would create for a single user, it’s likely Publix would need to tear down the space and rebuild it.
Gooding’s closed that location after filing for bankruptcy in 2005. Former owner Water Tower Retail LLC struggled to find an anchor to replace Gooding’s, but a variety of financial problems led to the property foreclosure.
A new Publix there would revitalize the property, which has a 49 percent vacancy rate. Other larger tenants include a 7,000-square-foot Joe’s Crab Shack, a 6,716-square-foot Pep Boys, a 4,197-square-foot Chick-fil-A and a 4,000-square-foot Exxon Mobil Oil.
“We’d love to see an establishment there just because it’s good for business and will liven up the plaza,” said Luis Quevedo, a service representative with Best Cleaners at Water Tower Shoppes.
The Kissimmee submarket, which includes Water Tower Shoppes, had a 4.2 percent retail vacancy rate in the third quarter, but also had a negative 14,437 square feet net absorption — space that was vacated and not backfilled. The average asking lease rate was $13.18 per square foot, said real estate data firm CoStar Group Inc. (Nasdaq: CSGP). That compared with a 4.7 percent vacancy rate, a net of 33,870 square feet of space that was filled and an average asking lease rate of $14.49 per square foot.
Publix is known in the retail industry as a financially stable anchor that can generate additional leases.
“The original anchor opened for two months, which never provided enough time for the center to mature,” said Jorge Rodriguez, director of retail for commercial real estate brokerage Colliers International, which is not involved in the project. “What was the biggest liability of the project — the anchor — just became the biggest opportunity for growth.”
Dwaine Stevens, spokesman for Publix in Orlando, declined to comment other than to say there is no signed lease there at this time. It is unknown whether Publix would keep both this store and the nearby one on International Drive and U.S. Highway 192. However, the grocery chain in the past has said it would have two stores close by, if the density and population supports it.
“Because of the strength of Publix, they can put stores in close proximity to capture the market and hinder competitors from moving in,” said Willow Shambeck, president of commercial real estate firm Cursor Properties Inc.
John Crossman, whose firm handles leasing and property management at Water Tower Shoppes, declined to comment. Officials from project engineer Lochrane Engineering Inc.were unavailable for comment by press time.