Sava's State Street Cafe owner to launch high-end market shop in downtown Ann Arbor

Lelcaj could not be reached for comment, but her attorney, the real estate firm that brokered the deal for both sides and the owner of the building spoke to AnnArbor.com about the deal.

“The lease is done, it’s signed and we’re ready to get her into the space,” said Mark Foraker, senior vice president of The Dinerstein Companies, which bought Sterling 411 Lofts on Dec. 30. “It’s absolutely a fantastic amenity for the building and for the residents that live there.”

It was not immediately clear what the new store would be named. Employees of Sava’s State Street Cafe said Lelcaj was busy handling the heavy influx of restaurant customers on the University of Michigan’s commencement weekend.

Bodman attorney Harvey Berman, who handles legal work for Lelcaj and also contributes articles to AnnArbor.com, said the market would offer high-end groceries, beer, a wine bar and espresso bar.

The market will face the Division Street side of the former Ann Arbor News building, which is now owned by the University of Michigan Credit Union.

Foraker said that architects and contractors have already met with construction crews to map out a plan for launching renovations soon. It's a 10-year lease, he said.

“She’s got a build-out allowance from us that’s generous enough that’s going to allow her to do a fantastic” space, he said. “I think her plan is to have first drawings for comment and review and approval in the next three to four weeks. She understands that getting the property open as close to the (start of the fall semester) is critical.”

The space the market will occupy has been empty since the student apartment high-rise opened two years ago.

Neal Warling of real estate firm Jones Lang LaSalle, which brokered the deal for both Sterling and Lelcaj, predicted that the market would be well received. Former Jones Lang LaSalle broker Newcombe Clark, who recently joined the Ann Arbor office of personalized recommendation firm MyBuys, also worked on the deal.

It will “serve not only the student population but the working population like myself that drives by there twice a day on my way in and out of town,” Warling said.

The deal comes as Sava’s State Street Cafe has flourished since moving into the former Zanzibar’s space on the west side of State Street near Liberty in August 2009.

The restaurant, which opened in 2007, had been located in a much smaller space on the second-floor of a building located on the plot across the street that CVS Pharmacy now occupies. The restaurant has nearly 10,000 square feet and seats up to 300 customers during peak times in the summer.

In October, Lelcaj told AnnArbor.com that her restaurant was serving about 650 people a day.

“She’s such a wonderful person and she’s such a successful operator of her restaurant and catering business,” Warling said. “I’m absolutely certain she’s going to be successful” with the new market.

The lease signing leaves Sterling with just one vacant retail space on the first floor of the apartment building, which has 96 apartments and 342 beds. The company recently signed a deal with sandwich chain Subway, which opened its doors on the Washington Street side of the first floor a few weeks ago.

Foraker said Sterling has already gotten “a lot of interest” in the remaining 3,500-square-foot bay of retail space. But he said the company decided not to sign a deal with any new tenants until Lelcaj agreed to launch her market there. He said he believes that Lelcaj’s market boosts the value of the empty space.

“It was a no brainer at the end of the day” to wait, Foraker said.

Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.