A conceptual plan to partially demolish the Durango Mall to build a “national organic grocery store” and 6.4 acres of rental apartments has drawn pushback from some residents and small business owners.
The plan would involve selling about 165,000 square feet of the mall at 800 South Camino del Rio to Kensington Development Group, LLC. About 25,000 square feet would be used for the grocery store, with the rest allocated for 230 to 270 apartment units.
The mall’s 94,400-square-foot northern section, home to retail tenants with long-term leases, would not be affected, according to the unofficial plan.
While Whole Foods has not been named by the Kensington Group or the city, many residents assume the Amazon-owned retailer is the “national organic food store” referenced in the plan.
The Kensington Group is planning a similar mixed-use project in Avon in 2026, which includes a Whole Foods Market.
City spokesman Tom Sluis said the grocery store’s name has not been approved for release.
The proposed project was first discussed at a Dec. 4 Community Development Commission study session.
Several residents voiced opposition during an Urban Renewal Authority board meeting Monday.
The Urban Renewal Authority board operates under state urban renewal law and is not responsible for making final decisions on proposals like the Kensington Group’s.
When a project seeks tax increment financing, the Urban Renewal Authority board assesses whether public investment is justified and whether the project advances the broader renewal plan. The board may recommend approval, but City Council makes the final decision on allocating funds.
In an email to the Herald, Sluis said the proposal is in “pre-application” status, and that the development group has not purchased the Durango Mall, finalized a tenant list or submitted an official development plan.
“City staff has engaged in preliminary conversations with both Kensington and the Mall owners – at their request – to explore what a proposed development might look like and to provide input,” Sluis said. “During these discussions, staff have offered alternative ideas and options that reflect the city’s priorities. These conversations are ongoing, and no formal proposal has been submitted to the City at this time.”
As of Tuesday, Rathbun Properties – which has owned the mall through Durango Mall LLC since 2012 – remained listed as the sole owner, according to the La Plata County Assessor’s Office.
Lauren Czaplicki, founder of the Durango-based fire mitigation startup Fungal Solutions, argued Monday during the Urban Renewal Authority board meeting that a large corporate tenant could harm local businesses.
“This is a misuse of tax increment financing as well as a diversion of community revenue that is needless,” Czaplicki said. “The project relies on tax increment financing that would divert increases in property and sales tax revenue away from the city’s general fund, schools, and essential public services. Instead of supporting community priorities, these revenues would be committed to subsidizing a private development.”
Joe Zwiebach, general manager of Durango Natural Foods Co-op, criticized the potential grocery store in the co-op’s December newsletter, “Good Thymes.”
“I’m not saying big is bad. But in the case of Durango, I believe it detracts from our small town appeal ‒ especially when we have two local stores and one Colorado based store that serves the same market,” he wrote. “Money is a wonderful motivator for city planners and is often put before established small businesses, town aesthetics and distinctiveness.”
Rachel Landis, executive director of the Good Food Collective, cited a recent poll done by her group showing small food suppliers across the region could face closure within a month if they lost 5% to 20% of their revenue. She suggested a national grocery chain could worsen those risks by diverting local dollars.
“(Small businesses) are essential assets to a community, and Whole Foods is not a substitute, and I’m quite concerned about what it would do across the region,” she said.
Karen Zink, who co-owns the building housing Sunnyside Farms Market on Escalante Drive with her husband, Jerry, said the couple have worked hard to funnel money back into the city through their business endeavors.
“I object to having a big-box grocery store such as Whole Foods (here), because I don’t believe they will plow anything back into Durango,” she said. “And I object to Jeff Bezos and Amazon getting a tax break to come in here and theoretically put the rest of us out of business – or certainly at risk.”
Sluis said the proposed developer would need to submit both a preliminary and final plan before City Council could consider the proposal – a process that would include public hearings.
He said the city recognizes both the opportunities and the concerns that come with a project of this scale.
“A large grocery chain and housing could address key community needs, but also raise valid questions about traffic, infrastructure, and the impact on local businesses,” he said. “The City’s approach is to gather public input and evaluate the proposal through established processes.”
Sluis said the city is committed to keeping the community informed and involved as the process unfolds.
The Kensington Development Group did not immediately respond to a request for comment Tuesday.
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