Industry analyst predicts store will open

A year and a half after the sale of Mike Kelly’s iconic Outer Banks Restaurant & Tavern to German-based grocer Lidl U.S. for $3.9 million, the building and property sit dark and empty in a prominent spot on the bypass.

      No construction work has started. Lidl's site plan, approved by the town of Nags Head for a 36,000-square-foot grocery store on the property, expired last October. And none of the parties to the sale seem to have a sense of what Lidl’s plans are — including the company’s own spokespeople.

      Nags Head Deputy Town Manager Andy Garman told the Sentinel, as he has in the past, that the town has "not heard from Lidl in recent months.” Asked if the property can remain vacant and unoccupied indefinitely, Garman explained that the town code has provisions "for property maintenance (i.e. grass cutting, etc.). As well, the town code and the North Carolina General Statutes address buildings that become hazardous or unsafe."

      While the grass is being cut on the property, Garman indicated the town did not know who was providing that service. He added that the town "will continue to monitor the condition of the property for these issues."

      Contacted by the Sentinel, Kelly said he has not spoken with anyone at Lidl and has no idea what their plans are for the property. Adding that he has heard Lidl is starting construction of new stores elsewhere, Kelly reported that earlier projections of building 100 stores in the year following the purchase of his property in Nags Head have been “knocked back to around sixty stores or so.”

      Asked for an update, Lidl U.S. Public Relations Specialist Chandler Ebeier stated, "We do not currently have new information to share about that location. We are focused on opening locations right now that can be the most convenient for the most shoppers possible."

      But at least one expert thinks he knows the Lidl game plan and believes a store could open in Nags Head within the next two years.

      Industry analyst Brittain Ladd said with the opening of its first U.S. store in 2017, Lidl had planned to build another 100 stores within the next 12 months. But the delay in following through on this plan can be partly attributed to poor planning last year, he said, when the company had no clear-cut strategy for expanding its presence in the U.S.

      With a change in leadership and the hiring of a new CEO last May, Ladd said the expansion plans have been scaled back to about 25 stores in the next year, while the company has deliberately stepped back to take more time as part of a “delayed expansion strategy.”

      Even so, the pre-purchasing of properties in high-value areas for development, in some cases several years later, is part of Lidl’s long-term strategy as well, Ladd explained.

      “The value of that real estate is only going to increase,” he said, “and they avoid the higher prices that would be in place later, when they’re ready to build…It will be at least two to three more years before we have a good understanding of whether Lidl will be successful in the U.S.A. But I guarantee they will.”

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