Hobby Lobby will open its first North Dakota store this fall in the former Kmart at the intersection of 45th Street and 13th Avenue South in Fargo.
The Oklahoma City-based arts and crafts store chain started refitting the store last week, a Hobby Lobby official said Tuesday.
"We're just excited about the opportunity," said Bill Hayne, vice president for advertising.
Garry Beller, supervisor of Hobby Lobby's Oklahoma-based refurbishing crew now in Fargo, said it normally takes three to four months to convert a Kmart into a Hobby Lobby.
Hobby Lobby operates 307 stores in a 27-state area. It started looking at the Kmart at 4427 13th Ave. S. last summer.
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Expecting Kmart would close the store, Hobby Lobby filed remodeling plans with Fargo's inspections office.
Kmart, which recently emerged from bankruptcy, used court protection to void long-term leases and close unprofitable stores nationwide. The 13th Avenue Kmart was closed early this year in the chain's second round of store closings.
Plans filed with the city call for Hobby Lobby to have a 60,751-square-foot store, roughly two thirds of the 95,096 square feet available in the building.
The building is leased by Tamkin Cos. of Los Angeles. No firm plans have been made for the remaining space, said Jeff Tamkin, the firm's president.
"We're talking to a couple of people," he said Tuesday. He anticipates Hobby Lobby to be ready in October.
Hobby Lobby is a privately held chain with nearly 11,000 employees and annual sales topping $1 billion.
The company's stores run from 55,000 to 70,000 square feet. They often open in locations where retailers such as Kmart, Wal-Mart and Montgomery Ward fail.
A major competitor for Hobby Lobby is Irving, Texas-based Michaels Arts and Crafts, which has a store a quarter mile southeast of Kmart in the TJ Maxx Plaza.
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Michaels has 774 stores in 48 states and Canada, and 153 Aaron Brothers custom framing stores. It posted total sales of $656.4 million in the first quarter of 2003, with net income of $20.8 million -- 82 percent higher than the same period last year.
A local Michaels employee referred a request for comment to the company's corporate office. A message to Michaels corporate communications late Tuesday afternoon was not returned.
However, having a Michaels nearby doesn't bother Hobby Lobby, said Hayne. He said most Hobby Lobbys are double the size of Michaels.
"That really doesn't affect our decisions. We're distinctive," Hayne said.
Hobby Lobby's Web site says it stocks more than 60,000 items per store, while Michaels says it stocks more than 40,000 items.
Readers can reach Forum reporter Helmut Schmidt at (701) 241-5583
