Here are the plans for the former Kmart on East State Street in Rockford

By Kevin Haas
Rock River Current
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ROCKFORD — Developers have put forward a plan to bring new activity to the shuttered Kmart on East State Street with a self-storage facility and the construction of new retail businesses that will line the front of the roughly 15-acre property.

U-Haul, which owns the property, and developer Orput Companies, which also manages the Edgebrook Shopping Center, put forward a plan to reuse the Kmart space while building three new structures for retail or restaurants. It will require City Council approval.

“Kmart was big box, and that big box is empty and it needs to be filled with something,” said Jennifer Smith, chairwoman of the city’s Zoning Board of Appeals, which gave unanimous approval to the development last week. “We’ve seen plenty of other sites where there are empty big boxes like that. I don’t see another retailer of that type coming into this space. That is not the trajectory of commercial and retail in the world, let alone Rockford.”

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Kmart closed its store at 5909 E. State St. in September 2018 as part of a sweep of closures across the country.

The new plan calls for redeveloping the nearly 106,000-square-foot Kmart space into a self-storage and outdoor truck storage business while redeveloping the former KFC and building two structures along East State Street and one along South Mulford Road.

A roughly 6,500-square-foot multitenant building would be constructed next to the former KFC along East State Street, and to the east of that would be a 2,100-square-foot quick-service restaurant with a drive-thru. Along South Mulford Road, a roughly 6,500-square-foot multitenant property would be built south of Connexus Credit Union.

There will also be a landscaped green space for stormwater retention installed between the former Kmart and the retail buildings facing State Street. Sidewalks will also be extended along the property.

“It’s such a viable use for a space that big, and having a viable national tenant is, in my opinion, a very good thing,” Smith said. “In my opinion, it’s a win.”

The city is also finalizing the terms of a redevelopment agreement for the property. There are no monetary incentives included in that deal. However, the city would require developers to move forward with at least two of the retail outlot properties before they can proceed with creating the self-storage space.

“We want to make sure, in general, that the outlots are also being developed in addition to the U-Haul,” City Attorney Nick Meyer said.

City officials note a similar model worked at Forest Hills Road and Riverside Boulevard in Loves Park, where Boxed Up self-storage anchored a redevelopment by First Midwest Group on that commercial corner.

Boxed Up filed a shuttered Sears at the site, and an Aldi grocery store was opened in front of the storage facility in March 2022. It has multiple other businesses along the corner, including retail stores and a Starbucks.

The proposal faced pushback during last week’s ZBA meeting from some nearby property owners who felt a self-storage facility was not the best use for the site. Greg Orput of Orput Companies responded by saying that U-Haul has done its market research to know there’s a market for the services, and that a storage facility provided the anchor for the other developments to come on the roadfront.

“While this use is not sexy and glamorous as many people would want, they are the owners,” he said at the meeting. “They’re willing to reinvest in this community and spend a lot of money to bring this corner back online and bring a lot of money back to the area.”

Next month, the city’s Planning and Development Committee will consider the redevelopment agreement for the site while the Code & Regulation Committee will consider the special-use permit required for a storage facility and drive-thru restaurant.

Those matters were initially slated to be discussed tonight but will be held out to allow time to finalize the redevelopment agreement, Meyer said. The next time those committees meet is June 10.

This article is by Kevin Haas. Email him at khaas@rockrivercurrent.com or follow him on X at @KevinMHaas or Instagram @thekevinhaas and Threads @thekevinhaas