Disappointment and controversy over opening of grocery store at downtown high-rise

NOW: Disappointment and controversy over opening of grocery store at downtown high-rise

SOUTH BEND, Ind. – The 300 East LaSalle project was set to be a new cornerstone of downtown South Bend.

Developed by Matthews LLC—responsible for dozens of other downtown projects—the building was set to feature multi-family apartments and a parking garage, along with a grocery store and a pharmacy, located right on the St. Joe River.

South Bend’s Executive Director of Community Investment, Caleb Bauer said “The goal was to have an identifiable grocery store in that space—a brand that residents are familiar with, and so that was our hope, certainly, and a big part in the city’s participation in supporting this project.”

An agreement was made with Matthews LLC in January 2017. $5 million were contributed from the city, along with another $5 million from the Regional Development Authority.

But after years of work, and two extensions, the final deadline given to open the grocery store was December 31, 2022.

Officials were dismayed at the results: rows of goods lined up on sawhorses, with paper signs advertising the market.

“It’s insulting what is set up in there,” said Bauer. “It’s a slap in the face to taxpayers.”

Bauer said the city is even considering pursuing the ‘clawback’ provision of their agreement, meaning Matthews LLC could be ordered to repay 150% of the amount contributed by the city. In this case, it could mean a payback of $7.5 million.

Developer David Matthews, of Matthews LLC, told me that this was not meant to be the final product.

“We asked for another extension from the state; they haven’t granted it or denied it yet,” Matthews said. “The grocery store had to open by the end of the year, and our operator opened it. It’s not ideal. We felt like we had a hand behind our back, tied off. But we had to meet that, just in case the extension isn’t granted. We are committed to making an awesome grocery store there.”

As of January 4, the store is not open. Matthews said they are still working to finish the grocery store and get the necessary permits to properly open to the public.

In the meantime, he said the criticism from the city is disappointing.

“The communication with the city isn’t always great,” he said. “If you don’t know what’s going on, it might be a slap in the face, but when there’s no communication, you don’t know anything.”

Bauer said the disappointing results of the grocery store could impact any future agreements the city enters into with Matthews LLC, though Matthews said that this is the result of numerous unforeseen challenges brought about due to the Pandemic, and that they remain committed in investing into South Bend.

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