Dallas City Council Approves Incentive Package for Tom Thumb in South Dallas

On Wednesday, April 12, the Dallas City Council voted to approve an incentive package for the development of a Tom Thumb grocery store in The Shops at Redbird, a defunct mall turned economic redevelopment zone. The incentives were awarded to Albertsons, the parent company of Tom Thumb. 

The incentives include up to $5.8mm in grants to be awarded on a conditional basis as well as a five year business personal property tax abatement on 75% of increased value during the first five years of operation.

Tom Thumb has a long history in the DFW area. Wes Jackson, Albertsons Companies Southern Division President alluded the history in his statement on the incentives:

Our new Tom Thumb store at RedBird will bring meaningful jobs to southern Dallas, as well as provide convenient access to fresh food and pharmacy services. Tom Thumb has been proudly serving the DFW area since 1948, and we know how grocery stores greatly contribute to the health of the local economy. We are honored to be making this investment at RedBird and are grateful for the overwhelming support of Tom Thumb as we embark on building a new store in this community.

The RedBird area is currently what would be considered a food desert, lacking in quality food options. Food deserts contribute to both public health and quality of life issues in affected communities. The Tom Thumb will be a full service grocery hub, featuring a pharmacy in addition to produce, deli, bakery, meat/seafood, and floral departments. Delivery and pickup options will also be available.

The Shops at RedBird is an ideal location for development grants such as this. The $200mm+ project currently houses 450 residents and employs 1500, with the Tom Thumb projected to provide 90 more permanent jobs to the development. The developer behind the project, Peter Brodsky, spoke highly of the grocery development:

It has been a long-term goal at RedBird to offer our community a high-quality grocery store with lots of fresh food options. We could not be more thrilled. I especially appreciate Albertsons’ understanding that there is a market in southern Dallas for their upscale Tom Thumb product and the City of Dallas’ willingness to provide the incentives to Albertsons to mitigate any perceived risks.

The incentives provided were surely a catalyst for Albertsons' investment. It is also not a stretch to see that these incentives should pay off in a big way: a grocery store is always a strong driver for retail centers, let alone when it is the only one in the area. Majed Al-Ghafry, Dallas Assistant City Manager, spoke to the difficulty of attracting such investment:

Attracting a quality grocery store to southern Dallas has not been easy so we are so pleased that Tom Thumb is committed to bringing healthy food options and more than 90 permanent jobs to this underserved community.

Robin Bentley, Dallas Director of Economic Development, had a similarly optimistic view:

This project meets the priorities outlined in the City’s recently approved Economic Development Policy by bringing a needed service to this Target Area, which also happens to be a food desert. We are thankful to Tom Thumb for their partnership and look forward to working with them to bring this grocery store to RedBird.

The value added by the grocery store should be a strong driver in revitalizing areas of Dallas that have been neglected by recent economic growth. Rising property values, partly driven by population influx, have made housing affordability an issue for many, so helping to revitalize low income areas such as RedBird should improve quality of life and serve to attract further investment to increase housing supply in the metroplex.

For investors, the revitalization of these neighborhoods may present attractive opportunities despite rising cost of capital and economic uncertainty. 

Sources:
https://www.dallascitynews.net/dallas-city-council-approves-incentive-package-to-bring-tom-thumb-grocery-store-to-redbird