In late 2021, word got out that Midwest supermarket and convenience store operator Hy-Vee planned to enter Indiana, Kentucky, Alabama and Tennessee. At the time, former CEO Randy Edeker said the company knew “it had so much to offer consumers across the U.S.” that it felt confident in making a major expansion into new territory.
The expansion plan was a significant step for Hy-Vee, which operates about 240 supermarkets and nearly 200 c-stores. Not only would it grow its footprint from eight to 12 states and look to cement itself as a legitimate threat in the competitive Southeast market, but it would be doing so organically by constructing upwards of 20 grocery stores as well as numerous adjacent convenience stores, liquor stores and fuel stations.
The initial plan was to have 21 locations operating in the new markets by this year, according to a report from the Des Moines Register, citing a leaked internal video presentation by Edeker. Hy-Vee went on to make a series of announcements touting plans to open stores in places like Spring Hill, Tennessee, and Fishers, Indiana. But nearly four years later, not only have none of these stores opened, but ones that were expected to be built haven't even started construction, according to public records and recent interviews with officials across these states.
The company hasn’t been entirely quiet on the expansion front. Last year, it entered Indiana with the purchase of 22 Strack & Van Til supermarkets, which will retain their brand name and operate as a Hy-Vee subsidiary.
Where Hy-Vee planned to expand
Yet the scope of its four-state expansion plan is still unclear. When asked to comment on these plans in early August, Hy-Vee Senior Vice President of Communications Tina Potthoff said that Hy-Vee’s primary focus at the moment is expanding in Indiana. She added that Hy-Vee still owns property in Kentucky and Tennessee but did not disclose the locations or construction timelines.
In a February 2024 interview with trade publication Progressive Grocer, Hy-Vee CEO Jeremy Gosch said that inflation and high construction and inventory costs had bogged down the company’s Southeast expansion plans. Officials in several cities slated for expansion said it’s been years since Hy-Vee provided updates — yet none of them said the retailer has told them the project is canceled.
Here’s where things stand with Hy-Vee’s expansion plans.
Few project records and updates
Tennessee was expected to see the largest influx of Hy-Vee stores in this expansion, according to the Des Moines Register’s 2021 account and local news reports, including two grocery stores and a distribution center in Nashville, plus several other locations across cities like Knoxville, Memphis, Murfreesboro and Spring Hill.
But while Hy-Vee confirmed it still owns property in Tennessee, it’s unclear where these sites are located and what their status is.
Public records searches with Nashville and Davidson County, Tennessee, for example, were unable to locate updates on where Hy-Vee’s plans stand, while officials with Knox County, where Knoxville is located, said in a phone call that they were unable to locate records for a planned Hy-Vee store in the county.
According to local news reports, a Hy-Vee location in Bartlett, a suburb of Memphis, was expected to open on the corner of New Brunswick Road and Old Brunswick Road. However, last month officials in Bartlett told the Des Moines Register that the plans for a Hy-Vee store in the area had been dropped.
Murfreesboro and Spring Hill’s records show some movement on store development, but updates fizzle out between 2022 and 2023.
Two Hy-Vee stores are slated for Murfreesboro, on Memorial Boulevard and Haynes Drive, and another off New Salem Highway near Barfield Road on the city’s Southwest side, according to minutes from the Murfreesboro Planning Commission from March 2023. The commission’s minutes disclosed that the Memorial Boulevard Hy-Vee site includes a 153,000-square-foot neighborhood shopping center as well as a more than 10,000-square-foot liquor store. Meanwhile, the planned New Salem Highway Hy-Vee site includes a 116,000-square-foot grocery store and a 6,000-square-foot convenience store with a fueling station.
Brad Barbee, Murfreesboro’s principal planner, said in July the city approved the Memorial Drive project back in March 2023, but that he hasn’t heard from the company in “some time.” Hy-Vee has until March 2026 to resume the project before the site plans expire.
Despite the lack of recent communication, Barbee said he has “no reason to believe [the project] isn’t moving forward.”
Spring Hill’s planned Hy-Vee storefront, meanwhile, is zoned for just over 16 acres on the Southeast corner of Buckner Lane and Buckner Road, according to city public records. In April 2022, Hy-Vee requested a “concept plan review” for a grocery store and gas station. The next and last available public record, dated July 2022, is a resolution regarding the installation of water and sewer lines at the site.
Construction headaches
Before its acquisition of Strack & Van Til, Hy-Vee’s expansion into Indiana was initially set to include two stores in the north Indianapolis suburbs of Zionsville and Fishers. Despite Hy-Vee’s spokesperson emphasizing that the company is momentarily focused on growing in the Hoosier State, it hasn’t started building either site due to construction delays, according to officials from both cities.
Both sites are supposed to share a distribution center, which also hasn’t begun construction, Zionsville Mayor John Stehr said in an interview.
In a statement, Ross Hilleary, director of planning and zoning with the city of Fishers, said Hy-Vee delayed its local store due to “impending road improvements.” When asked to elaborate, Hatem Mekky, Fishers’ director of engineering, said the city is working on two roundabout projects — one at the intersection where Hy-Vee is expecting to build and another about two blocks away — that are slated for construction next year.
Hy-Vee told Stehr earlier this spring that the company is “waiting for the construction cost to come in line with their goals” before they begin building Zionsville’s first store, Stehr said.
Stehr added that he keeps in touch with Hy-Vee’s team “every couple of months,” and that despite the delay, he has no reason to believe they’re backing out of the project or putting the property up for sale.
During their last interaction this year, Stehr said he and Hy-Vee’s team discussed the grocer’s 2024 acquisition of Strack & Van Til in Northwest Indiana, which signaled that the company was active in its expansion plans.
Plans on hold — or potentially never started
Hy-Vee’s plans for Kentucky so far include just one store in Louisville. Last October, Potthoff told Louisville Business First that the grocer hadn’t set a date to break ground but still planned to build the 150,000-square-foot store.
It turns out these plans were put on hold three years ago when all parking lot, grading and foundation permits for the site were withdrawn, according to records with the city of Louisville. Although Hy-Vee said it still owns the location today, the permits were axed in an April 2022 email exchange between Erin Hiscox, a project engineer with Hy-Vee, and Janice Johnston, a building inspector with the city, according to records viewed by a C-Store Dive reporter.
A spokesperson from the city confirmed in July that no progress has been made on the site since this email exchange. The spokesperson said they weren’t sure why Hy-Vee withdrew these permits, but said that “it might have been a case where they didn’t have the applicable planning applications approved yet.”
Meanwhile, a spokesperson from the Jefferson County Property Valuation Administrator said in a statement that they have no information to share on the site’s delay.
"They say they’re still coming, but their actions might indicate otherwise, and they’re not really making any meaningful movement toward coming here."
John Stehr
Mayor of Zionsville, Indiana
Similarly, Hy-Vee’s first Alabama store hasn’t made any progress. The site was originally planned to open in Huntsville in 2023, the Des Moines Register reported in 2021, but the city appears to be unaware of the grocery chain’s entrance plans.
“After consulting with our Inspections department, it appears that no plans were ever submitted and no permits were ever issued for a Hy-Vee grocery store for the City of Huntsville,” the city said in response to a request for public records.
While Potthoff confirmed Hy-Vee still has a stake in Indiana, Tennessee and Kentucky, she did not give any update on whether the grocer owns property in Alabama or if it still plans to enter the state.
As Hy-Vee’s expansion plans have stalled, other regional grocers and c-store chains have moved into the same states it’s targeting, making any eventual move all the more challenging. Publix now operates several grocery stores in Kentucky, while Wawa and QuikTrip recently opened their first stores in Indiana. Wawa also recently opened its first store in Kentucky in late July.
Hy-Vee is also contending with rapidly evolving low-price retailers like Walmart, Aldi and Dollar General that operate stores in many of the same Midwest markets. Research shows that these discount retailers are putting increasing pressure on traditional grocers as consumer price sensitivity has risen.
It’s unclear whether or not Hy-Vee will ever carry out its original plan, or amend it in some way, but plenty of questions linger.
In Indiana, where Hy-Vee says it’s most squarely focused, Mayor Stehr admitted that he has no idea when the Zionsville store might be built, as the company hasn’t updated him on any of these plans. Stehr added that he doesn’t expect this store to open in 2025.
“I do not have 100% confidence that they’re going to come here,” he said. “I only know what they’re telling me… they say they’re still coming, but their actions might indicate otherwise, and they’re not really making any meaningful movement toward coming here.”
Correction: A previous version of this story misspelled street names in Spring Hill, Tennessee. A Hy-Vee store was zoned for the intersection of Buckner Lane and Buckner Road, according to public records.
