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Posted on Thu, May 20, 2010 : 6:04 a.m.

CVS buys South State building as it moves ahead with new downtown Ann Arbor store

By Paula Gardner

cvs site 2.JPG

The building at 209-211 S. State will be demolished - though the facade will be preserved - to make way for a new CVS drug store. The property, shown here between the Corner House Lofts high-rise and a two-story retail building, represents more retail changes along the corridor as U-M opens North Quad (far left) this fall.

Paula Gardner | AnnArbor.com

Plans are proceeding by a national drug store chain to build a store in Ann Arbor on the edge of the University of Michigan campus.

CVS finalized the puchase of the buildings at 209-211 S. State this week.

Now the drug store chain appears prepared to start the construction process for building an $8 million store on the site.

When completed, the project will continue the transformation of South State Street from the University of Michigan Diag to North Quad, the new dorm in the final stages of construction between Washington and Huron.

The corridor, already the location of some of the city’s highest retail rental rates, is gaining prominence among retailers as the U-M development promises even more pedestrians and nearby residents.

The CVS project brings a high-traffic national retailer to the street, now where chain and local restaurants and clothing stores fill most of the storefronts.

The deal was complex, said seller Alex Hurst of New York-based Palatine Capital Partners.

“It took a tremendous among of work,” Hurst said. He credited “motivated parties on all sides.”

The purchase price was not disclosed. Hurst bought the property in February 2008 for $2.1 million. Its assessed value is $608,000.

cvs site 1.JPG

The facade of 209-211 S. State will be preserved as CVS builds its new store behind it.

Paula Gardner | AnnArbor.com

The two-story building, which sits on 0.15 acres just south of the Corner House Lofts high-rise, is actually two houses combined behind a commercial storefront.

The city’s Historic District Commission and City Council approved a plan to leave the historic façade but demolish the building behind it and construct the new store area.

Unclear is the timetable for construction. John Baumann of the West Bloomfield-based Velmier Companies, developer of the site for CVS, did not return calls seeking comment.

However, city officials said activity has picked up on the property.

“They’re now working on getting their permits,” said Alexis DiLeo, city planner.

Utility work and adding a fire hydrant will have to take place before any working on the building, DiLeo said.

They’re also going to have to coordinate with city staff to coordinate sidewalk and lane closures on South State Street, DiLeo added.

The final tenant in the building, Conde Electric, has been relocated to a new office, said Newcombe Clark of Jones Lang LaSalle and a member of the city’s Downtown Development Authority.

The CVS deal, he said, “is a good use for the building.”

CVS Caremark Corp., based in Rhode Island, operates more than 7,000 retail drug stores in 41 states and employs 211,000. With its stock selling at $34.95 per share at market close on Wednesday, the company’s market capitalization was $47 billion.

Paula Gardner is Business News Director of AnnArbor.com. Contact her at 734-623-2586 or by email. Sign up for the weekly Business Review newsletter, distributed every Thursday, here.

Comments

Trepang674

Mon, May 24, 2010 : 8:01 a.m.

Sorta gross to have a commercial chain in the downtown area, but it most likely will enhance live-ability once all thoughs lofts/condos and apartments fill up with urbanites.

Susan

Thu, May 20, 2010 : 10:56 p.m.

Honestly, how many drug stores do we need!!?? Every time I see a new building being built lately, it is a CVS or a Walgreens. There is a new one on Zeeb at Jackson, a new one going up on Jackson near Stadium, right near the Rite-Aid at Westgate and I am sure I don't even know all of the others. Meijers has more drug store type items than any of these stores. They aren't even real drug stores!

Olan Owen Barnes

Thu, May 20, 2010 : 9:09 p.m.

Now the question is - when are they going to move into the empty store on Jackson and Zeeb road that has been left to ferment for some time?

A2K

Thu, May 20, 2010 : 8:15 p.m.

Ah the McDonald's on Maynard...the nice design with all the steep glass windows were irresistible to the nefarious pickle-racers, and so the award-winning windows were always streaked with drying trails in yellow, red, and greasy grey.

treetowncartel

Thu, May 20, 2010 : 3:34 p.m.

I believe this is the same store front where Make Waves was located at too, which catered to Ann Arbor's new wave/punk rockers back in the 80's. @ Ed, I think the Main Street drug store was a Rite Aid. There was also Food and Drug at Packard And Stadium not to long ago, although it wasn't a chain.

stillatownie

Thu, May 20, 2010 : 2:54 p.m.

there used to be a mcdonalds downtown (maynard just south of nickel's arcade). it did not get very much business.

frozenhotchocolate

Thu, May 20, 2010 : 11:46 a.m.

finally a place dtown where a can of soup doesn't cost $4, now all we need is a mcdonalds and a meijer, not kidding.

samshoe

Thu, May 20, 2010 : 9:09 a.m.

Looking forward to having a drug store downtown again.

DagnyJ

Thu, May 20, 2010 : 8:07 a.m.

It would be great to have to drug stores in town...but I still love the folks at Village Apothecary who will always have my business.

5c0++ H4d13y

Thu, May 20, 2010 : 6:19 a.m.

Great. I've been wanting a drug store downtown. BTW I hate the reconstruction plans that leave the facade in place and put an entire new building up. It's like Disney architecture.