New Wal-Mart a boon, business leaders say

But labor leaders say chain drives down wages, pushes out competitors

James A. Dula, president and CEO of the Prince George’s Chamber of Commerce, is sanguine about the new Wal-Mart.

‘‘When Wal-Mart comes into the community, then that’s going to bring people,” Dula said.

Rufus Lusk, a partner in the Port Town Shopping Center at Colmar Manor located within two miles of the new Wal-Mart, recognizes the business opportunities that come with more customer traffic.

‘‘People will shop more in our community,” Lusk said.

Nevertheless, Lusk is preparing for competition from the giant discount retailer: This summer, he plans to renovate the CVS pharmacy in his shopping center.

The revamped drugstore will include a health clinic open daily and staffed by a nurse trained to handle common medical ailments such as a runny nose or rash, Lusk said.

The major investment of a new Wal-Mart in the community will spur other investments, Lusk said, and competition is the nature of the retail business.

‘‘We’re improving our services, and I think other businesses will do the same,” said Lusk, who is also a member of the Port Towns Community Development Corp. Through the local group, he worked with a community coalition, including Wal-Mart officials, to address concerns that arose when people learned the big-box retailer was coming to town.

‘‘I’m very happy with the work that’s been done, with the attitude of the Wal-Mart officials, and I look forward to Wal-Mart being a member of our community,” Lusk said.

The new Wal-Mart is expected to generate 250 to 350 jobs.

The 144,000-square-foot store has replaced the old Capital Plaza mall, which was built as a non-enclosed plaza in the mid-1960s. It was redeveloped in 1985 as an enclosed mall anchored by Bradlees and Montgomery Ward.

Hechinger’s replaced Bradlees in the late 1980s. Later, both Hechinger’s and Montgomery Ward went bankrupt. By 2001, the mall was left with no anchors and business waned.

‘‘The mall remained open until 2004, when it was closed in anticipation of redevelopment,” said Paula McDermott, director of asset management at Nellis Corp., which owns the plaza. ‘‘We had been planning to redevelop the mall for a long time.”

The freestanding McDonald’s restaurant and Chevy Chase Bank branch remain.

When a Wal-Mart opens in a rural area where residents rely on smaller, established merchants for basic items, it tends to drive those stores out of business because they cannot compete, said Leigh Riddick, associate professor of finance at American University.

‘‘That has been a trend since Wal-Mart started that has caused havoc in some areas,” she said.

However, nearby retailers that don’t compete directly may flourish when a Wal-Mart opens in a suburban area, Riddick said. For example, a small clothing store, bookstore or restaurant might benefit from the foot traffic generated by Wal-Mart, she said.

The commercial area around the new Wal-Mart has a mix of fast food chains, mini-marts, hair and nail shops, carpet and flooring businesses, small hardware stores, car dealerships and pawn shops, few of which would compete directly with Wal-Mart.

The new Wal-Mart highlights the lack of high-end retail in Prince George’s County, said Mark Federici, director of strategic programs at United Food and Commercial Workers Local 400, which represents workers at Giant Food, Safeway and Shoppers Food Warehouse.

There is no Tysons Corner or White Flint Mall or Reston Town Center in Prince George’s, he said. Opening a fourth Wal-Mart in the county doesn’t respond to residents’ outcry for more upscale merchants.

Wal-Mart critics point out that the allure of more jobs is a pitfall that often hurts the working class more than it helps.

‘‘It’s not about providing jobs — it’s about providing good jobs with a pathway to the middle class,” said Chris Kofinis, spokesman for Wakeupwalmart.com, a United Food and Commercial Workers International Union project. Wal-Mart is able to sell at low prices because it pays employees poorly and provides practically no benefits, he said.

Employers such as Wal-Mart only exacerbate problems such as those at Prince George’s Hospital Center in Cheverly, which is financially strained by treating many uninsured patients, Federici said. Too many Wal-Mart workers aren’t paid enough to afford health insurance, he said.

Wal-Mart also drives down wages in the community by forcing other merchants to follow its lead, or it pushes out its competitors entirely, Kofinis said.

Dula said he is familiar with the arguments criticizing Wal-Mart’s employee compensation.

‘‘People need all kinds of jobs,” he said. ‘‘And we need to offer jobs of all levels so that everybody can be included in the ongoing progress of the county.”

The Wal-Mart store will be part of the company’s Jobs and Opportunities Zones program, an initiative designed to bolster job creation and economic development in surrounding neighborhoods. As part of the program, the store plans to work with local chambers of commerce, business groups, minority chambers of commerce and minority- and women-owned businesses in these zones to direct thousands of dollars in grants.

The program also will provide support to local businesses by offering advertising inside the Wal-Mart store and by paying for advertising in local newspapers.

In determining where to launch the program, the company’s real estate and regional team considers areas that may have been designated as economically challenged or in need of development, said Don Frieson, Wal-Mart vice president and regional general manager, in a previous Gazette interview. The company has established 10 such zones across the country.

‘‘They’ll be a long-term contributor to the betterment of the area on a number of different levels,” Lusk said of Wal-Mart. ‘‘It’s good for the community, and good for the business community.”