Hy-Vee closing Cedar Rapids First Ave. store June 23

Logan Avenue store in Waterloo also closing; spokesperson says locations ‘have not consistently met our financial expectations’

Hy-Vee First Avenue Cedar Rapids
The Hy-Vee store at 1556 First Ave. NE in Cedar Rapids will be permanently closing June 23, 2024. IMAGE VIA GOOGLE

Hy-Vee will be permanently closing its store at 1556 First Ave. NE in Cedar Rapids as of June 23, company officials have confirmed, leaving a potential “food desert” in one of the lowest-income areas of Cedar Rapids.

A store at 2181 Logan Ave. in Waterloo will also be closing June 23, officials said.

Both the Cedar Rapids and Waterloo stores are located in historically economically disadvantaged neighborhoods.

“Unfortunately, these locations have not consistently met our financial expectations and sales goals over the past several years,” Hy-Vee spokesperson Tina Potthoff said. “All employees will be offered a position at another Hy-Vee store in the area, at the same rate of pay and will retain their existing benefits. Pharmacy customers’ prescriptions will be automatically transferred to another local Hy-Vee Pharmacy. Patients will receive a letter in the mail with additional information on the pharmacy that will serve them in the future.

“Hy-Vee continues to be committed to the Waterloo and Cedar Rapids area through our involvement and continued investments in the local community, and we look forward to serving our customers at one of our other local Hy-Vee locations,” Ms. Potthoff added.

Officials also noted that Cedar Rapids and Waterloo customers will still have the option to use Hy-Vee Aisles Online for grocery delivery in the areas impacted by the store closures.

Tiffany O'Donnell
Tiffany O’Donnell

“Hy-Vee’s decision to close their First Avenue store is incredibly disappointing,” Mayor Tiffany O’Donnell said. “Generations of customers have relied on this store for their basic needs. It is unfortunate the company is leaving at a time when the nearby neighborhoods are seeing significant improvements and public investment. We anticipate this momentum will continue when combined with efforts like the upcoming First Avenue Micro Area Action Plan community planning process. We know that access to fresh, affordable food is crucial for our community’s well-being, and we will work with local agencies to meet the needs of those impacted most by this closure.”

Dale Todd
Dale Todd

Cedar Rapids City Council member Dale Todd, a key player in the negotiations with Hy-Vee to rebuild the First Avenue store in 2001, said city officials were “completely blindsided” by Hy-Vee’s decision.

“This decision, executed by the highest levels of Hy-Vee corporate, is shortsighted and an abandonment of some of our community’s most vulnerable,” Mr. Todd said, “and when inner city stores are closed in both Waterloo and Cedar Rapids at the same time, one must ask serious questions about the moral commitment that Hy-Vee has to all citizens. Having dealt with them previously, the way they executed this decision is a stain on their reputation.”

Mr. Todd also raised concerns about the factors cited by Hy-Vee officials in their decision to close the First Avenue store.

“We understand the challenges and complexities of running a business in an inner-city neighborhood and we are sensitive to their need to make money, but instead of working with us to address the inherent challenges, this feels like abandonment and a run for the  suburbs,” he said. “We believed we had a deal for five more years. We are focusing on revitalizing this neighborhood.”

“There is obviously a new corporate tone at Hy-Vee,” Mr. Todd added. This is no longer (former president and CEO) Ron Pearson’s Hy-Vee, where business is done with a handshake and a smile in every aisle. It’s about shareholders and the bottom line.”

Sami Scheetz
Iowa State Rep. Sami Scheetz

Iowa State Rep. Sami Scheetz expressed “deep frustration” with the Hy-Vee decision, calling it “a move that directly impacts the residents who supported the store with substantial tax incentives.

“This store was built on the back of taxpayer support, and its closure betrays the community’s trust and investment,” Mr. Scheetz said.

Mr. Scheetz also noted the closure of the “critical grocery” will particularly affect the working-class neighborhoods of Wellington Heights and Mound View, potentially leading to a food desert, and noted the decision comes “even as Hy-Vee announces expansions in other states.”

“Our community has supported Hy-Vee with a 20-year tax increment financing deal aimed at keeping a grocery store in this location,” Mr. Scheetz said. “It’s disheartening to see that while our local dollars helped Hy-Vee grow, our own citizens are left with diminishing services.”

Mr. Scheetz said he is actively seeking solutions to the situation and is “unwavering in (my) commitment to explore and implement effective strategies to combat food insecurity.”

“I will continue to work to ensure no one goes hungry in Iowa — a state which feeds the world — and that no one faces barriers to accessing the nutrition they need,” he added.

The First Avenue store in Cedar Rapids has served as a key food source within walking distance for residents of the Wellington Heights and Mound View neighborhoods.

The store was rebuilt in 2001, with the aid of financial incentives from the city of Cedar Rapids, including a 20-year tax abatement. At the time, Hy-Vee officials said the store rebuilding project would not have been economically feasible without city incentives.