Hy-Vee restarts construction of new distribution center in Iowa

Hy-Vee has resumed building a new distribution center in Cumming, Iowa, that had been paused last year.

The warehouse, situated just south of Hy-Vee’s hometown of West Des Moines, will take up 635,000 square feet and house Lomar Distributing, the Midwestern food and drug retailer’s specialty products division. A Hy-Vee spokesperson said Wednesday that the facility also will support two other distribution centers, in Chariton and Cherokee, Iowa.

Lomar had outgrown its warehouse in Des Moines, and the new distribution center is “needed to accommodate our continued growth,” the spokesperson said in an email, adding, “We are still more than a year out from having this facility operational.”

Hy-Vee had disclosed its suspension of the Cumming warehouse project in April 2022, when the company published an advertorial explaining that it was enacting some strategic changes and cost-saving measures in response to signs of a possible U.S. economic recession.

Those measures included asking up to 500 more corporate office employees to shift to retail management positions. Hy-Vee also cited savings efforts made in the past few years to head off potential price increases, such as cutting back on around-the-clock store hours; restructuring retail leadership by adding district store director and store manager positions; shifting Hy-Vee Aisles Online operations to locations with high demand; and pausing or postponing some construction projects.

“As construction costs hit record highs, the company is pausing several projects—such as the new warehouse in Cumming, Iowa—to be resumed at a later date, and is evaluating its existing land parcels to determine whether the spaces still align with its growth plans for the future,” Hy-Vee stated in an April 27, 2022, advertorial appearing in the Cedar Rapids Gazette.

Located off Interstate 35, the nearly 145-acre site also is slated to contain a small-format Hy-Vee Fast & Fresh store, a convenience-focused retail concept offering meal solutions, an assortment of groceries and a coffee shop, as well as a fuel station. The store would be situated on an outparcel in front of the main distribution building.

According to a site plan from the City of Cumming and published reports, a 200,000-square-foot automated warehouse also is expected to be added to the distribution center in a later phase and would be attached to the distribution center.

Overall, Hy-Vee operates more than 285 stores in Iowa, Illinois, Kansas, Minnesota, Missouri, Nebraska, South Dakota and Wisconsin.