Pyramid Foods seeks sublease of Smillie's store

Longtime area grocer Bill Smillie has set the date for his retirement, and he says it has nothing to do with a megaretailer’s construction of a grocery store across the street from his store.

He will close Smillie’s Market, 1421 S. Glenstone Ave., in August and focus on his role as executive director of the Ozark Empire Grocers Association.

Smillie said his decision to close shop came after his landlord, Jared Enterprises Inc., agreed to lease the store to Pyramid Foods, the holding company behind 48 grocery stores in Missouri, Arkansas and Oklahoma under names such as Price Cutter, Ramey and Smitty’s.

Pyramid’s lease begins Sept. 1, and Erick Taylor, its president and CEO, said the company is seeking to sublease the roughly 20,000-square-foot space at the southwest corner of South Glenstone Avenue and East Bennett Street.

Taylor said he found the lease opportunity more than a year ago while renegotiating contracts related to the five properties Pyramid leases from Jared Enterprises in and around Springfield. Through those talks, Taylor said the Smillie’s property was offered as an incentive to finalize a larger agreement.

He said he recently offered to sublease the property to Smillie, but Smillie declined.

“We thought the rent was pretty cheap, and we could sublease it and make a profit,” Taylor said. Though he declined to provide Pyramid’s lease rates, he said the company would likely list the Country Club Shopping Center end-cap for $7 per square foot.

Smillie said he had been considering his own retirement when he learned in June 2010 that his lease had already been given to his competitor.

“We had never considered extending the lease. I’ll be 67 years old next year, and a 67 year-old doesn’t need to be obligating himself to 10 to 15 years further out,” Smillie said. “So, we never considered extending the lease, but we never had the chance.

“We never got the opportunity to say ‘yes’ or ‘no’.”

Curtis Jared, executive vice president and chief operations officer at Jared Enterprises, said Smillie was consulted about pursuing a new lease before Pyramid agreed to a deal amid negotiations on other properties. Jared Enterprises owns or manages roughly 1 million square feet of commercial space, including BKD’s downtown headquarters and Deerfield Office Suites.

“We had spoken with Bill on multiple occasions on what lease rates would be and everything, and those were the same terms that we offered to Price Cutter when we inevitably worked out that deal with them,” Jared said, adding that Smillie can still strike a deal with Taylor.

“It’s not like Bill doesn’t have the opportunity to stay there.”

According to the Greene County assessor’s office, the 1.7-acre parcel owned by Jared’s Country Club Center LLC has a 2011 appraised value of $593,000.

After learning his lease was sold to Pyramid, Smillie then worked to secure the executive director post with the Ozark Empire Grocers Association in September 2010, telling its board of directors that he planned to retire. The organization has a policy against letting an area store owner hold that position, but it made an exception for Smillie based on his retirement plans.

Smillie said his retirement is not connected to the 40,000-square-foot Walmart Neighborhood Market under construction across Glenstone Avenue.

“We’re not leaving because of Wal-Mart,” he said.

Taylor said Pyramid isn’t shying away from the competition; he just doesn’t feel the site is the right place to square off.

“That’s not the kind of facility with which we’d want to compete against Wal-Mart head-to-head,” Taylor said. “We wouldn’t have near the room to have the selection and variety and all the things that the customer (wants).”

Taylor said if Pyramid cannot find a tenant, the company would consider moving one of its stores into the space.

“We’ll make something out of it,” Taylor said. “We thought we could either lease it to people or we could lease it to Smillie if he wanted to stay there, and if all that fails, we could try some new format.”

The company hasn’t yet marketed the property because Taylor said he’s only recently learned that Smillie wouldn’t be a candidate to lease the space from Pyramid.

“We didn’t want to do anything that could impact his business. And we wanted to give him the option to stay there,” Taylor said.

Smillie said he felt the head of Price Cutter was capitalizing on an opportunity to pick up a great center city location.

“For Price Cutter to want it was not surprising,” Smillie said, adding he thought Taylor intended to open a store at the site until earlier this year when Wal-Mart unveiled its plans for a Neighborhood Market at the northeast corner of Glenstone Avenue and Bennett Street.

Taylor admitted he felt Smillie’s retirement was a foregone conclusion before he called last month to see if there was any opportunity for Smillie to sign a new contract.

“I just wanted to make sure,” Taylor said.

Smillie said Pyramid is the largest member of the Ozark Empire Grocers Association, and both grocery veterans said they considered each other friends.

Smillie began working at the Consumer’s No. 4 store – the forerunner to Smillie’s Market – in 1964. He met his wife there in 1967. After a stint in the Navy beginning in 1968, he came back to work for Consumer’s for a few years. Then he left for nine years to help run Phelps Lumber Co., a family owned business, before Smillie came back to Consumer’s for good in 1986. After a change in ownership, Smillie got the opportunity to buy his old Consumer’s store in 1992.

He signed a five-year lease on the property at that time for $2 per square foot, with three five-year renewal options, he said.

Had he continued working out of that site, he would have had to renegotiate with Jared Enterprises, which started in 1990 as CRW Properties Inc. and is an outgrowth of Clarence Wheeler’s Consumer’s grocery chain that once had 38 stores in four states. Wheeler, Smillie’s former boss, is Curtis Jared’s grandfather.[[In-content Ad]]