Site work is well underway on the new Publix grocery store, which will serve as an anchor tenant for the revamped Cullman Shopping Center on U.S. Highway 31.

This week, heavy equipment can be seen laying blocks near the foundation of the soon-to-be grocery store. Publix will be joined by fellow newcomers PetSmart pet supply and Dick’s Sporting Goods. Existing tenants Belk, Shoe Department and Books-A-Million have also recommitted. Additional tenants could be announced in the coming months, along with at least two outparcel restaurants.

Publix is tentatively set to open later this year.

The 50-year-old, U.S. Highway 31 development is currently anchored by Belk, JC Penney and Books-A-Million. Work is underway to fully renovate and restore the existing facilities, then expand the development with new construction on the back side behind the now-demolished Food World location. Once complete, the new work will increase total square footage to more than 325,000 square feet of retail space.

In addition to representing a major reinvestment in the north Cullman property, the Cullman Shopping Center project also marks the city’s first-ever foray into a retail tax-sharing agreement as part of the recruitment incentive package.

The council agreed to a tax-sharing agreement with Merchants Retail Partners (MRP) last year worth up-to $6 million. Under the deal, businesses in the development will still pay sales tax, though the city will pay back some of those funds for a set period of time. The deal only affects city sales tax (1.75 percent) and does not include education taxes.

Current estimates show those amounts would total approximately $276,000 paid back via a portion of existing sales tax the first three years, with as much as $800,000 produced (and split) in the subsequent seven years from new development. The city also approved $1.8 million in infrastructure upgrades for the project earlier this year.

MRP manages several large-scale developments across the southeast, including the Tiger Town retail development in Opelika. Tiger Town is anchored by big box tenants such as Bed Bath and Beyond, Dick’s Sporting Goods, Kohl’s and Target.

* Zach Winslett contributed to this report.

* Trent Moore can be reached by e-mail at trentm@cullmantimes.com, or by telephone at 734-2131, ext. 134.