The location, along the 1800 block of Baltic Avenue, will be the city's first grocery store there in more than 15 years.
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Leaders held the ceremonial groundbreaking on Thursday morning.
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Construction on the new store is expected to start in a few months and will take a little over a year to complete.
The $18.5 million development will bring healthy and affordable food to the city, ending its status as a so-called food desert.