This is my first post, but I spent a good deal of time today and yesterday reading posts on this thread going several years back. I'll try to be brief in this, and address the most recent development proposals, but just for some background: I grew up in Bedford near South River Road, and spent most of my time in high school living at my mother's house a few blocks north of Webster Street in Manchester. I left in 2003 to go to school in Boston, and have lived there since, but I still consider Manchester home and I think the city has enormous potential to be a premiere New England city. I'm already getting into this a bit more than I had intended, but I think the next several decades will see a resurgence of regional midsize cities like Manchester, Portland and so on, as more people move back to cities from the suburbs. If it can build on its gains since the mid-1990s, Manchester will probably be able to attract more young people back and away from larger cities (like the one I've left it for).
That said, the recent Market Basket announcement is a huge disappointment. The city does need an urban grocery store, but not necessarily this one and not on this site. The proposed
Manchester Food Coop would be the best option in my view, as it would be locally owned, and be a destination food store. There's something to be said for locating a Market Basket, which sells affordable groceries and is relatively locally owned, downtown, and it would in many ways replace the two Vistas that used to exist in the area. Still (and this is harder without a car), there's a large grocery store just up the road from this site on Valley Street. There is no good reason to devote such a large and strategically important site to a full-size grocery store.
This brings me to much next point, which is that a grocery store downtown should not only serve downtown residents (though it must do this, too), but also be a destination grocery store. A Market Basket will not do this. A Whole Foods would, though I think that would price out a good segment of the local population, and better options might include a Trader Joe's or the proposed Coop. The latter two, and even Whole Foods to a certain extent, require less space than a full-size grocery store and less parking as many people would stop in for speciality items while downtown.
The biggest problem with this though is how much of a step back it is for Manchester, and how much of a missed opportunity this represents. For at least a decade now, the area has been a proposed Gaslight District, which the city should really move to develop. Small shops, restaurants, bars and apartments would fit wonderfully into the dense building stock between Granite Street and this site, and larger scale stores can create an urban counterpoint to the mall across Elm Street in the numerous old warehouses. The Market Basket site is the best site in the city for an eventual (and hopefully not far off) commuter rail/intermodal transit center along the railroad lines with tons of prime mixed-use development space leftover along Elm Street. There could be an urban grocery store on this site, and even a Market Basket, but it needs to be part of this larger project.