CERES -- The company that wants to develop a Wal-Mart Supercenter here told shareholders early this month that it is slowing the pace of new projects because of the recession.
Florida-based Regency Centers Corp. is a national developer of grocery-anchored shopping centers and has developed almost 200 centers since 2000. Its chief executive officer said at the company's annual meeting May 5 that it will invest in new projects with caution.
So what does that mean for the Ceres center?
"We have heard nothing at this time that it means the Ceres project is on hold," City Manager Brad Kilger said Friday. "We have been having weekly meetings with the development team, including Regency, and they have given us every indication they are still moving forward."
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Pete Knoedler, a vice president of investments for Regency, said through an assistant that the company could not comment at this time.
A Wal-Mart representative said the project is still viable, despite the tough economy. "We continue to see our customers looking for ways that we can save them money, particularly with their food purchases," said Aaron Rios, a Wal-Mart spokesman. "We are still working on that store."
The Colliers International real estate firm is marketing the proposed 26-acre center at Mitchell and Service roads near Highway 99 with a potential opening in September 2010, although a Colliers representative said that is optimistic.
According to the marketing literature, the center would have 304,000 square feet of commercial space anchored by a 195,000-square-foot Wal-Mart Supercenter. It would be slightly smaller than the Wal-Mart Supercenter in Stockton. The remainder of the Ceres center would have retail stores, shops and restaurants.
Supercenters are larger than regular Wal-Marts and sell general merchandise and groceries, including fresh meat, fruit and vegetables.
Rios said the timeline for building and opening the center depends on city approvals. A draft environmental study should be completed in a couple of months. Planning Commission hearings on Mitchell Ranch could start in late fall, followed by hearings before the City Council.
Kilger said the shopping center could be built and opened within a year of issuing city permits, which could place the opening of Mitchell Ranch in late 2010 or the first half of 2011.
At its annual meeting, Regency announced a plan for steering the company through the recession. It recently cut dividend payments to shareholders and has laid off 100 employees, or 18 percent of its work force, since early 2008.
The company noted, however, that grocery-anchored shopping centers are fairly resistant to a recession. The sale of more than $300 million of company stock will cover capital needs for the next three years.
"A lot of projects that have (opened) recently have struggled, but this project is still pretty far out," said Ben Rishwain, an associate retail specialist for Colliers. "We have had interest from some pretty strong tenants."
He said he expected to know more after talking with potential tenants, architects and others at a Las Vegas convention over the weekend.
Rios said Wal-Mart is awaiting release of the environmental impact report, which will tell what improvements are needed to mitigate effects on traffic, air quality, noise and public services.
The Mitchell Road turnoff on Highway 99 would be the main freeway access to the center. Traffic counts at Mitchell Road and Highway 99 have exceeded 110,000 vehicles per day; there is no estimate on how much additional traffic the supercenter would generate.
For years, the state Department of Transportation has planned a new interchange on Highway 99 to replace the Mitchell Road turnoff and the Service Road crossing. There is no need to build the interchange before the shopping center is allowed to open, said Tom Westbrook, a senior planner for Ceres.
Bee staff writer Ken Carlson can be reached at firstname.lastname@example.org or 578-2321.