Photo: Kroger

Kroger, the second-largest grocer in the U.S., has opened its first food hall inside a new store in downtown Cincinnati, near its headquarters.

The Rhine Eatery, on the second floor of the 52,000-square-foot space, features five local Cincinnati restaurants: Kitchen 1883 Café and Bar, DOPE! Asian Street Far, Django Western Taco, Eli’s BBQ and Queen City Whip. The space, which can accommodate 200 customers in both indoor and outdoor seating, also includes a Kitchen 1883 Café and Bar, Kroger’s American food restaurant concept.

The first floor offers a traditional supermarket experience, including fresh fruit and vegetables, as well as grab-and-go and ready-to-heat meals, to support downtown workers and residents in addition to customers from the city’s Over-the-Rhine and West End neighborhoods. The store anchors an 18-story apartment building and is a block away from The Kroger Co. headquarters.

The urban concept further stands out for its walk-up window for beverage orders. Grocery and eventually restaurant delivery will be featured.

Kroger hasn’t operated a store in downtown Cincinnati since 1969 and has talked about doing so since acquiring the upscale, urban-focused Mariano’s chain in 2015.

“This innovative destination highlights Kroger’s food-first culture,” said Kroger’s chairman and CEO Rodney McMullen said in a statement.

Food halls, offer mini-restaurants run by artisanal and local vendors, have been expanding rapidly across the U.S. over the last decade and often support nearly retail. They are said to particularly appeal to Millennials looking for variety and authentic experiences.

Several grocers have been opening sit-down eateries over the last two decades that some describe as casual food halls selling the grocer’s ready-made foods. Some including Hy-Vee and Wegmans have added in-store restaurants that they operate themselves. Others, including Whole Foods and Mariano’s, have partnered with outside restaurants to show support for the local community. Partnering with a popular hotspot can also elevate the cachet of a grocer’s sit-down offerings.

DISCUSSION QUESTIONS: Are food halls a natural complement to grocers’ urban locations? What are the pros and cons for grocers around working with third-party restaurants versus developing restaurants in-house or just relying on prepared food offerings?