Wal-Mart proposes Milwaukee supercenter

Plans to expand S. 27 St. store expected to draw opposition

By TOM DAYKIN
tdaykin@journalsentinel.com

Posted: Sept. 21, 2006

Wal-Mart Stores Inc. wants to expand a discount store on Milwaukee's south side into a supercenter, a development that would create Wal-Mart's first combined discount store and supermarket in Milwaukee County.

Wal-Mart would substantially enlarge the 138,000-square-foot store, at 3355 S. 27th St., to about 211,000 square feet, said Lisa Nelson, a Wal-Mart spokesman. But those plans could change and the expansion could be smaller, Nelson said Thursday.

Wal-Mart wants to expand the store in response to demand from its customers, Nelson said. She said the store, with 340 employees, would add 210 jobs because of the expansion. About 70% of employees at a typical Wal-Mart supercenter work full time, Nelson said.

The expansion proposal likely would rekindle opposition from nearby residents, who fought plans for the original store in 2000, said Ald. Joseph Dudzik, who represents the area on the Common Council.

The supercenter would be just a few blocks north of a Pick 'n Save store and within a three-mile radius of two other Pick 'n Saves, the Milwaukee area's dominant supermarket chain.

Wal-Mart has added supercenters in the Milwaukee area's outlying communities, including a Germantown store that opened this week. But a supercenter on Milwaukee's south side would bring Wal-Mart's competitive might much closer to the heart of Pick 'n Save, operated by Roundy's Inc.

Forced to lower prices?

The increased competition likely could force Pick 'n Save and other south side supermarkets to lower their prices, said David Livingston, a supermarket site selection consultant. Some weaker groceries could close because of sales lost to Wal-Mart, he said.

Livingston, who operates DJL Research in Pewaukee, said Pick 'n Save's market share is peaking at just more than 60% in the Milwaukee metro area. That market share has climbed in recent years after Kohl's Food Stores Inc. closed in 2003 and Jewel Food Stores Inc. stopped building new supermarkets in southeastern Wisconsin.

However, Pick 'n Save's market share will drop somewhat, Livingston said. Among other things, he cited this week's opening of a Whole Foods Market on Milwaukee's east side; the upcoming development of a 237,000-square-foot Woodman's Food Market in Oak Creek; and the continued encroachment of Wal-Mart supercenters. The result will be more choices and lower prices, he said.

"All of these things, I think, are really going to benefit the consumer," Livingston said.

However, Wal-Mart could face opposition when it seeks Common Council approval to expand the 27th St. store.

The store has a problem with cleanliness, including shopping carts frequently dumped in a nearby city-owned green space, Dudzik said.

"I'm not really a fan of the store," said Dudzik, who's called a community meeting next week to hear the opinions of neighborhood residents.

Nearby homeowner Michael Lowe said he'll oppose the expansion plans. Lowe drives to a Wal-Mart at 4500 S. 108th St., Greenfield, rather than shop at the 27th St. store, he said.

"The store looks like a tornado hit it," Lowe said.

Wal-Mart is aware of those problems, and it is fixing them, Nelson said.

Possible union opposition

The supercenter plans also could draw opposition from United Food and Commercial Workers Union Local 1473, which represents union workers at Jewel, Sentry and Pick 'n Save stores. The international union has opposed Wal-Mart, a non-union employer, throughout the country since it entered the supermarket business in 1988.

Wal-Mart has forced the closing of union supermarkets in part by undercutting prices through low wages and substandard health care benefits for Wal-Mart employees, union officials say. As a result, family-supporting jobs at union supermarkets have been wiped out, said Dan Welch, Local 1473 president.

Wal-Mart, the nation's largest supermarket chain, has opened dozens of Wisconsin superstores since 1997 but none in Milwaukee County. In the Milwaukee area, Wal-Mart operates supercenters in West Bend, Germantown, Mukwonago, Burlington and Mount Pleasant, and plans to develop another one in Hartford.

Wal-Mart in 2004 proposed a supercenter at W. Loomis Road and Highway 100 in Franklin. It drew opposition from Franklin residents who said it would bring traffic congestion, environmental damage and crime. Wal-Mart later dropped those plans.

Wal-Mart faced similar objections in 1999, when it sought Common Council permission to build the 27th St. discount store, at the site of the former Southgate Mall. The store was the first Wal-Mart discount store in Milwaukee, which since has added city Wal-Marts at 401 E. Capitol Drive, 5825 W. Hope Ave. and 8700 N. Servite Drive.

Then-Ald. Paul Henningsen, chairman of the council's Zoning, Neighborhoods and Development Committee, broke a 2-2 tie among committee members by supporting Wal-Mart. But Henningsen also said then he was "dead set" against any proposed future expansion of the store to include a supermarket.

A grocery store use was approved as part of Wal-Mart's zoning plans in 1999, said Andrea Rowe Richards, Department of City Development spokeswoman. But Wal-Mart still needs Common Council approval to expand the building, she said.