PROVIDENCE — Smith Hill is getting the supermarket it has long pined for, after ALDI Supermarkets announced yesterday that it will take over the vacant Valueland property on Smith Street.

The site has been empty since Valueland closed in 1998, and local leaders breathed a sigh of relief at finally finding a use for their neighborhood eyesore.

“This new market will fill a void that has lasted far too long on Smith Hill. This is not just about the convenience of being able to walk around the corner for groceries; it is about the sense of community that comes from going to your local store,” said Terrence M. Hassett, the area’s city councilman.

The arrival of ALDI comes in a year when Providence area has lost two supermarkets, Shaw’s stores in Eagle Square in the Valley neighborhood and off North Main Street just over the Pawtucket border.

The German ALDI chain is making this its first announced project in Rhode Island, but also has projects in the works for Cranston, East Providence, and West Warwick. Worldwide, ALDI — ALbrecht DIscount — operates 7,500 stores, and its 850 U.S. locations are primarily Midwestern. The move is part of a larger push to enter the New England market; the chain has five New England stores open now, and is building a distribution center in South Windsor, Conn., to serve those it plans to open.

“ALDI has been very well received as we’ve increased our presence up and down the East Coast,” said Bruce Person, a vice president with the grocer. “We’ve developed an extremely loyal customer base that has become accustomed to the high-quality, low-cost products they can get at ALDI. We’re excited to bring these benefits to the residents of Rhode Island.”

The loss of Valueland a decade ago was a traumatic moment for Smith Hill, Hassett said, and many proposals have been made to return a store to the site.

It was all many residents ever wanted to talk about, said state Sen. Maryellen Goodwin.

“No matter where we traveled in this neighborhood, the main question was what was going to happen with the Valueland property, and please can we have a market?” she said.

But after several grocery revival efforts failed, Providence College, whose campus is less than a mile away, stepped in and bought the property in 2002. The college had planned to build athletic fields at the site, according to college Vice President Ed Caron.

But, Caron said, PC was able to build an artificial-turf field on its main campus in Elmhurst, and decided to sell the property last year. A closing is set for Thursday, Caron said.

“Although it took almost five years in a very difficult economy to identify the right buyer, PC has achieved what no public or private interest had been able to do previously — find a suitable developer that would use the property to address important retail needs in the Smith Hill neighborhood,” Caron said.

Pawtucket-based Marshall Properties stepped in as the developer. Marshall envisions creating a multi-use plaza at the site, potentially with two more standalone buildings erected in the large parking lot space. The 22,000-square-foot Valueland building itself will be renovated, but ALDI will only use 18,000 square feet, freeing up 4,000 for what will probably be two retail businesses, according to Marshall’s Lianne Marshall.

The building itself is in good shape, Marshall said, and they hope that the renovation work takes no more than a year.

“We are thrilled to have this opportunity to develop this,” Marshall said. “We really and truly hope to have this store open no later than the beginning of 2009 — so we really need to get moving.”

Neither PC or Marshall would discuss the sale price or the cost of redevelopment.

Hassett said that the neighborhood is in need of a pharmacy and a bank, and both are possibilities for the other stages of the project. He said that discussions took place in the past with CVS executives about bringing a drugstore to the plaza, and they will press the Woonsocket-based company again now that ALDI is in place.

Price-Rite Supermarket is expected to move from Olneyville Square to Eagle Square to replace the Eagle Square Shaw’s, according to City Councilwoman Josephine DiRuzzo, but that will leave a hole in Olneyville Square that will be tough to fill.

.

dbarbari@projo.com