A former Food City property in Tempe is being transformed into a mixed-use development featuring affordable housing and a new grocery store, replacing a site that has sat vacant since the grocery chain closed its doors in 2021.
The redevelopment, known as Dorsey Station, will bring hundreds of affordable apartments and restore grocery access to an area city leaders say became a food desert after the store closed.
Redevelopment
The nearly eight-acre property is located at Apache Boulevard and Dorsey Lane along the Valley Metro light rail line.
Tempe purchased the site for $10.6 million a few months after Food City closed in 2021, according to real estate database Vizzda.
City officials said they acted after residents expressed concerns about losing a nearby grocery store and the possibility of the property being redeveloped into luxury housing.
Housing
The project will include approximately 400 apartments, with 90% designated as affordable housing.
According to the City of Tempe, the units will be available to households earning between 30% and 80% of the area’s median income.
For a two-person household, that translates to annual incomes between about $27,000 and $71,950.
Housing is generally considered affordable when residents spend no more than one-third of their monthly income on rent.
Grocery Store
As part of the redevelopment agreement, developers must build a grocery store of at least 10,000 square feet.
City officials said the space could be expanded if the selected grocery operator requires a larger footprint.
No grocery chain has been announced, but Tempe Mayor Corey Woods said the goal is to attract a retailer offering groceries at affordable prices for local residents.
Timeline
The city selected Dorsey Development Partners and Palindrome to lead the redevelopment after a competitive request for proposals process.
Construction will occur in phases.
City officials expect the first residents to move into the development in 2028, with additional phases scheduled for completion in 2029 and 2030.
Legal Questions
The project’s affordable housing requirement comes as similar development agreements face legal scrutiny in Arizona.
The Goldwater Institute has challenged a comparable Phoenix project, arguing that requiring affordable housing violates Arizona’s prohibition on inclusionary zoning.
Mayor Woods said Tempe has not been contacted regarding the lawsuit and continues to pursue similar partnerships as one of the few available tools to increase affordable housing.
Addressing Housing Needs
Woods said the city continues searching for additional properties that could be converted into affordable housing developments.
He said rising housing costs across the Valley have made it increasingly difficult for teachers, service workers, and other residents to live in Tempe.
City leaders say projects like Dorsey Station are intended to help preserve affordable housing options while restoring essential services such as grocery access.
FAQs
Where is Dorsey Station located?
It is at Apache Boulevard and Dorsey Lane in Tempe.
How many apartments are planned?
The project will include about 400 apartments.
Will there be a grocery store?
Yes, the development includes a new grocery store.
When will residents begin moving in?
The first phase is expected to open in 2028.
Why did Tempe buy the former Food City site?
To add affordable housing and restore grocery access.
