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Former Kmart building still seeking new owner

Amid the holiday shopping season, one of Mitchell's larger retail spaces remains vacant. The former Kmart building has yet to find a tenant, and Mitchell Building Inspector John Hegg said he has yet to see a building permit for the location come ...

The former K-Mart building on Burr Street in Mitchell. (Sarah Barclay/Republic)
The former K-Mart building on South Burr Street in Mitchell. (Sarah Barclay/Republic)

Amid the holiday shopping season, one of Mitchell's larger retail spaces remains vacant.

The former Kmart building has yet to find a tenant, and Mitchell Building Inspector John Hegg said he has yet to see a building permit for the location come across his desk.

The 25-year-old, 91,470-square-foot building - owned by Utah-based GFI Mitchell Investments, according to the Davison County Department of Equalization - has been vacant since Kmart closed its doors in April. When the closure was announced in January, the Mitchell Kmart employed 52 people.

As rumors fly about possible tenants at the South Burr Street building, Mitchell Area Development Corporation Executive Director Bryan Hisel said filling the large structure could be a 36-month process.

"The building will be refilled someday," Hisel said. "I don't know what, I don't know when and most importantly, I don't know for how much. So it's a good property, it will be reused depending on the right company seeing value in that building."

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At the same time the Mitchell Kmart announced it would close its doors, officials said the Pierre location would do the same. But the void left by Kmart in Pierre was quickly filled, when craft store Hobby Lobby announced it would open in the Northridge Plaza.

But an official with Hobby Lobby squashed rumors it was considering a move to the Mitchell Kmart.

"While Hobby Lobby is constantly looking for new locations to better serve our customers, we have no plans in Mitchell, S.D.," said Bob Miller, a Hobby Lobby communications coordinator.

Currently, Hobby Lobby has four locations in South Dakota, including Pierre, Aberdeen, Rapid City and Sioux Falls.

Despite the lack of interest from Hobby Lobby as of Thursday, Hisel expects the former Kmart building to be an appealing property. With ample parking, several surrounding businesses and close proximity to Interstate 90, Hisel said there's a lot to like about the building. What's more challenging is its size, which Hisel said is "a lot of building."

Repurposing the space, Hisel said, could require multiple businesses to move in. And repurposing the property was also hampered by contract relationships between the building's owner and Kmart.

"There were some options that Kmart had that needed to lapse prior to the building that owns the building aggressively remarketing the building," Hisel said. "So at some point, we're always ready, willing and able to help distribute on the web, etc., information about the building availability."

When Kmart closed its doors for good in Mitchell, four large national retailers remained in city limits, including Menards, Cabela's, Shopko and Walmart. Despite the vacancy in the building, Hisel said Kmart leaving Mitchell closed one door while opening another to a new business.

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"A building that's available is in one way a liability, but it's also an asset," Hisel said.

Related Topics: RETAIL
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