Market Watch

The Barrio may become home to new grocery markets, restaurants and residential units.

After a few years without a grocery store of any kind, Tucson's downtown barrio might soon be getting at least one. But whether it's a neighborhood market, a corporate chain, or both, remains to be seen.

Opened around 1914, Jerry's Lee Ho Market served the barrio until it closed two years ago. Its namesake, Lee Ho, was a clerk at another grocery before setting up his own business, as well as his residence, at 600 S. Meyer Ave.

When the market opened, there were dozens of Chinese groceries in Tucson, mostly tiny stores where people would walk daily to buy necessities, a satisfactory situation in a community which only had about 15,000 residents.

For more than three decades, Lee Ho would continue to operate the market. But by 1950, according to the city directory, he was no longer involved with the business, and its management passed to others.

Five years ago, the store was sold for $219,000 to Gilles and Barbara Desjardins. The previous owner jumped at the chance to sell, saying the small, 6,700-square-foot neighborhood market couldn't compete in today's business environment.

The Desjardins, who were unrelated but shared the same last name, later purchased the nearby S&W market building for $149,000. It had a one-bedroom apartment in it, but the remainder was empty.

Over time, the Desjardins' turned Jerry's Lee Ho into a small grocery and successful rooftop fondue restaurant. But they violated numerous city building codes in the process, while running up hundreds of thousands of dollars of liens on the property. Faced with that enormous debt, the two buildings were put up for auction, and the Desjardins' eventually got out of town, leaving behind some disgruntled people.

At an auction in December 2002, a high bid of $350,000 was made for the vacant Jerry's Lee Ho market, with the proposed buyer planning to build an office building next to it while retaining the grocery or installing loft apartments. At the same time, $240,000 was offered for the S&W building. Those amounts were not accepted, and the pair of structures reverted to Jay Sherman, the largest lien holder.

Sherman wanted to sell the two properties as a package, but last year, Warren Michaels bought them with the intention of splitting them apart for resale. He also considered chopping the structures up for living space, but he concluded that would be a disservice to the neighborhood and believed a market/cafe would be a better use for the Jerry's Lee Ho building.

"The real payoff," Michaels says, "will be having it come alive again."

While Michaels has the S&W building under contract to sell next month for artist studios, Jerry's Lee Ho market was purchased for $400,000 by Dana Pitt last September.

"I bought it because I thought it was a good property, and I could do something successful for the neighborhood and for Tucson," says Pitt. "The market can be responsive to the neighbors," she adds, "a place where people can get staples and a good cup of coffee."

While she is still looking at her options for the building, Pitt is considering having a market, along with either a cafe or restaurant, and possibly two residential units. She acknowledges the historic structure needs renovation, including plumbing, electrical and roofing work, which she hopes to start this spring.

Just as that renovation project could be getting underway, the city of Tucson might be close to an agreement to install a retail center, anchored by a 60,000-square-foot grocery store several blocks away. According to Assistance City Manager Karen Thoreson, negotiations are continuing over the long-discussed project at the northeast corner of 22nd Street and Interstate 10, but she hopes they can be finalized by March.

Thoreson indicates that in addition to the corporate grocer, the center would have smaller tenants along with two pads for restaurants. The possibility of relocating Fire Station No. 1 from its present south Stone Avenue site to the 22nd Street property is also being considered, she says.

Local businessman Tom Warne was selected by the city through a competitive process to develop the shopping center project, and he reiterates Thoreson's hope that by March, a handshake deal with a grocery store chain can be reached. Once that happens, he says, exact details of the arrangement will have to be agreed to in writing.

Would a large grocery store several blocks away diminish the chances for success of the Jerry's Lee Ho market renovation effort? Dana Pitt doesn't think so.

"They're different concepts," she concludes optimistically. "We'd be much more like a corner market. People in the neighborhood can have both."

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