An automated vegetable-growing process offers a creative solution for filling empty big-box stores.
Chicago-based Wilder Fields, which calls itself a “technology-enabled food company,” plans to spend $40 million to turn a vacant 135,000-square-foot Super Target store in Calumet City, Illinois, into a vertical farm with the capacity to produce 25 million leafy green plants each year. Leafy greens sales are a $5 billion industry.
The introduction of a new category of business to an outmoded space demonstrates one way to revitalize an empty shopping center anchor. Malls already have changed from exclusively retail environments to social centers with dining and entertainment venues. Now the increasing shift to online shopping, accelerated by the impact of COVID-19, creates a new incentive to find fresh alternatives to help these struggling properties thrive.
The COVID-19 pandemic has severely challenged the commercial real estate sector. According to Statista, before the pandemic emerged in March 2020, there was a 9% vacancy rate in retail real estate nationwide. By July, that number had jumped to 20%. Additionally, The Wall Street Journal reported in June 2020 that the retail market is on pace to rival the number of bankruptcies seen in the aftermath of the 2007 to 2009 financial crisis.
“We are creating a blueprint for how to impart new life to empty, expansive buildings,” said Jake Counne, who founded Wilder Fields in 2016. In July 2020, he told the Chicago Sun-Times that as far as he knew, “converting a big-box store to a farm has never been done before.”
To establish a vertical farming enterprise, Wilder Fields developed proprietary technology to improve labor efficiency and reduce the energy costs associated with traditional vertical farms. Wilder Fields’ design for commercial vertical farming also offers a number of environmental benefits. Growing in highly controlled cleanrooms eliminates the need for herbicides and pesticides, uses 95% less water and returns thousands of acres of farmland to nature.
In traditional vertical farms, plants are stationary, and workers move among the plants to tend them and harvest produce. Wilder Fields has devised a transport system that uses a series of conveyers and lifts to move the plants around the facility at a high throughput. This allows the farm technicians to work at their stations while the plants come to them, significantly improving efficiency and reducing waste.
A second set of innovations at Wilder Fields uses artificial intelligence to monitor plant health and progress multiple times per minute. Computers analyze videos and images to dynamically control exactly how much lighting and cooling plants receive at any given point in their life cycle. This reduces wasted resources.
“We created our systems to be flexible enough to fit into existing buildings, including big-box anchor retail spaces in distressed shopping centers like our first site,” Counne said.
At the Calumet City site, 24 separate cleanroom growing environments will house dozens of varieties of greens grown year-round. Leafy greens are a well-understood crop, can be grown profitably from Day 1 and are one of the biggest categories in fresh produce. As vertical farming evolves and becomes more economical, Wilder Fields may expand to add different crops, according to Counne.
Wilder Fields will use back-of-the-house areas of the former Super Target for a research laboratory, seeding station, office and an employee breakroom. A large loading dock already is in place for shipping produce to nearby supermarket distribution centers, as well as directly to supermarkets and select restaurants throughout metro Chicago. The first phase of the full-scale commercial vertical farm includes building and operating a retail store for fresh produce grown onsite for the surrounding community, and an AgTech learning center for families and school groups.
With this initial project funded by a group of private investors, construction is planned in two phases. Phase 1, to be completed in early 2021, includes building critical infrastructure and completing the first two cleanrooms. Each cleanroom houses racks with eight levels of growing space as well as the proprietary technology. The second, larger phase is slated to begin in 2022.
“There’s no how-to guide about converting shuttered retail big boxes into farms,” Counne said. “Building out the space in two phases gives us the opportunity to develop efficiencies during our initial construction and operations that will expedite our progress for our major completion with Phase 2. It also makes it possible for us to start generating revenues and educating customers sooner in early 2021.”
Wilder Fields’ location on the perimeter of a major urban market is essential to reducing the carbon footprint associated with transporting greens. By developing vertical farms inside the regions where people will consume their produce, Wilder Fields ensures that the greens can be consumed when they are freshest. It also eliminates the financial costs and negative environmental impact of trucking produce long distances. In 2008, researchers with Carnegie Mellon University estimated that food transportation may account for 50% of total carbon emissions generated by the processing of many fruits and vegetables.
Ultimately, the longer the distance the food travels, the greater the emissions and fossil fuel consumption required to transport it. Additionally, most consumers today only have access to leafy greens grown on a commercial scale that are predominantly designed to withstand an extended and bruising supply-chain journey.
“Wilder Fields’ model for vertical farming enables us to eliminate several days or even weeks of the typical supply-chain paradigm,” said Counne. “We also can avoid the inevitable storage in a warehouse and the bruises and damage incurred during long-distance shipping time. Growing and shipping locally is an essential part of our business model.”
Wilder Fields plans to establish commercial-scale vertical farms in other urban areas across the country.
Officials Embrace Concept
Many factors go into converting a big-box store to a full-scale commercial vertical farm or similar venture. Installing the advanced technology requires an extensive buildout, so longer lease agreements or purchase options are an essential incentive.
While scouting possible locations, Counne was introduced to Calumet City officials in the summer of 2019. His proposal won the support of city leaders eager to revive an ailing retail corridor and bring a new venture to their community. In addition, Wilder Fields will provide jobs in which workers with no experience can start as entry-level harvesters — where they learn about agriculture as well as artificial intelligence and automation technology — and then advance to higher-level positions.
Still, there were obstacles to overcome. Calumet City officials and Wilder Fields leaders worked together to address retail zoning issues and to negotiate tax breaks and incentives. Because the vacant Super Target was located in a tax increment financing (TIF) district for Calumet City, funds had already been allocated to fortify that commercial area. According to Counne, Wilder Fields benefits from a 10-year TIF agreement. Additionally, the Chicago Tribune reported in July that Calumet City bought the vacant store from Target and will lease it to Wilder Fields for 12 months. Counne told the newspaper that he plans to purchase the property from the city when the lease is up.
The city met with other nearby retail tenants to gain support.
“Even with a retail store, our vertical farm will generate much less traffic than a large retailer,” Counne said. “So upfront, open communication is vital in order to set expectations and encourage buy-in from other tenants.”
Shopping center tenants include WOW Furniture Outlet and Beauty Hair accessible from the parking lot along with the Super Target site for Wilder Fields. The shopping center also includes an indoor mall featuring Old Navy, Party City and Ross.
“Part of the Wilder Fields strategy is to find big-box spaces in already ailing retail corridors,” said Counne. “The Calumet City location had been empty for five years. When big retail spaces are empty that long, there can be a vicious cycle of downward effect. The spaces get harder to fill over time and tend to generate more empty spaces. Wilder Fields will have a retail component and educational programs that will generate considerably more traffic than an empty building, so the neighboring retailers see this as an improvement.”
Indoor Agriculture’s Potential
The U.S. Department of Agriculture (USDA) predicts that global population will exceed 9 billion by 2050. The agency says that indoor farming could be a crucial tool for relieving food shortages, particularly in urban areas.
According to a 2019 report from Statista, crop yields from indoor farms can be more than 10 times greater than outdoor farms. Because of that, indoor farming is expected to see strong global growth. Estimates range between about 8.5 million square feet to 16.55 million square feet by 2021. The market for food products grown indoors could be worth up to $6.4 billion by 2023, according to Statista.