This is a developing story and will be updated with more information as it becomes available.
On Thursday, the City of Wilmington confirmed that Cape Fear Holdings was no longer pursuing the purchase of city-owned property on Chestnut and Third streets.
Cape Fear Holdings, closely tied to local developers and realtors Cape Fear Development and Cape Fear Commercial, put in a $1.7 million bid for the property last year. The deal "contemplated" a 10-year restrictive covenant requiring that the property be primarily used to build a grocery store. No specific grocery store or chain was identified, but Publix was widely rumored to be a top candidate, since the developers had worked with the company in past projects.
On December 3, 2024, the city voted to accept the offer, pursuant to a 10-day upset bid process. No one else bid on the property.
The deal gave developers 365 days to close on the deal (it's not clear if that clock started on December 3 or after the upset bid period ended, a city spokesperson said they're working to clarify that). During that time, the existing city facilities on the property were demolished.
Developers told the Greater Wilmington Business Journal, which broke the story, that the timing was not right on the project.
The property was initially put up for sale along with other city-owned parcels in the hopes of paying down debt on the new City Hall, known as the Skyline Center. But the city confirmed that the property won't automatically go back on the market.
"The City is exploring a downtown master plan to look at all its holdings to determine the most strategic use based on the city's needs," according to a city spokesperson.
The prospect of a downtown grocery store — long a priority for city planners — was cited by both New Hanover County and The Endowment in pulling funding from the Northside Co-op, a non-profit grocery store planned for the city's Northside, which has long been a food desert. The Endowment paused, and eventually cancelled, a $6.8 million grant (some of which had already been spent), and the county removed $2 million in funding during its last-minute budget negotiations last June.
WHQR emailed The Endowment to ask for comment on if and how the collapse of the downtown grocery store deal impacts their grantmaking decision with regards to the Northside Co-op.
