CHARLOTTESVILLE, VA (CVILLE RIGHT NOW) – The Charlottesville Food Co-op will not move forward with a grocery store in the 501 Cherry Avenue development, the group announced Monday.

However, Woodard Properties, the Piedmont Housing Association and Fifeville Neighborhood Association later announced in a statement the same day they’re “encouraged by conversations with other grocery operators who have concluded that the site is, in fact, a viable opportunity and we will continue to work alongside the FNA to find the right fit for Fifeville”.

The site has mostly laid vacant since the closing of Kim’s Market around 2020.

That market opened for a number of years after IGA closed its doors in 2002 after operating there for more than 50 years.

The developers of the proposed 501 Cherry mixed-used complex brought the co-op in early 2025 as the best choice to operate a grocery store in a commercial space in the new development.

But the co-op said in its July 20 statement its Steering Committee had voted not to move forward as the proposed grocery store’s operator.

“Following an extensive feasibility analysis in the last year, which included consultation with grocery industry experts, operational planning, financial modeling, and site analysis, last month the Co-op determined that the current site plan, as designed, coupled with the already thin profit margins in the grocery industry, does not provide a path for a financially viable, full-service grocery store focused on affordable food access,” the co-op said. “The analysis identified multiple challenges affecting grocery store feasibility, including building design constraints, customer parking limitations, delivery by large semi-trucks, loading inefficiencies, dedicated waste management logistics, and other operational burdens that would increase costs and hinder long-term sustainability.”

The co-op acknowledges some of the issues could be individually addressed, but the overall combination “create insurmountable challenges.”

Charlottesville Food Co-op has not closed the door completely on being involved in a possible grocery store around Fifeville.

“While disappointed by the outcome, the Food Co-op’s Steering Committee members have not dismissed the possibility of exploring other locations where a community-owned grocery store might operate successfully and serve residents for generations to come,” the co-op said.

“While we are disappointed that we were unable to reach a path forward with the Charlottesville Food Co-op, we respect their process and their commitment,” the developers said in their statement. “The Co-op poured tremendous heart and expertise into this evaluation, and we are genuinely rooting for their success in finding the right home for a community-owned grocery store.”

The develops added they have worked “from the outset” with the Fifeville Neighborhood Association to create a space both practical and sustainable for a neighborhood-scale grocery market.

“Even within the site’s considerable constraints, we have achieved a plan that exceeds the proffer commitment by providing 40% more commercial space than required for the grocery market, while maintaining lease rates substantially below market, enhancing both economic viability and community benefit,” the developers said. “Whether the neighborhood ultimately selects one of these grocery operators or pursues another community-focused use for the commercial space, we are enthusiastic to break ground this fall.”

The Charlottesville Food Co-op and developer Woodards Properties have not always seen eye-to-eye throughout work on this project

Back in May, the co-op announced that consultant Seven Roots found the grocery store part of the development “not feasible under the current design”.

It cited delivery truck limitations and waste removal contingencies that are not negotiable in a grocery store operation.

However, Woodard Properties responded later in the same day “respectfully” disagreeing with the consultant’s report.

“BRW Architects and Shimp Engineering designed the development in close partnership with Piedmont Housing Alliance, the Fifeville Neighborhood Association, and the Music Resource Center. Our design professionals have extensive experience with constrained urban infill sites like this one, and other experienced operators who have studied this project have found it both feasible and desirable,” the developers said in a statement to Cville Right Now at the time. “Woodard Properties remains committed to delivering all three components of this project: affordable housing, the new home for the Music Resource Center, and a working neighborhood grocery store, and to doing so in close partnership with the community we have worked alongside throughout.”

In the new statement, the development entities reaffirmed their commitment to “ensuring the commercial space at 501 Cherry Avenue fulfills its promise as a community benefit, and we will continue to engage residents, explore diverse food access options, and work toward a solution that honors the original spirit of the Community Benefits MOU while delivering tangible progress for families in this neighborhood.”