Highland residents soon will have more shopping options beyond Kohler's in their backyard.

Highland Marketplace, a new $40 million grocery-anchored retail development, is being built at the northwest corner of Highway 92 and Alpine Highway. The 186,000-square-foot project -- expected to bring in between 150 and 200 jobs -- is scheduled to be completed by summer 2008.

Project co-owner Tom Hulbert declined to identify the 65,000-square-foot grocery anchor, saying leasing discussions are still ongoing.

Developed by Salt Lake City-based Thomas Fox Properties, the development will have a total of 40 tenants including Little Caesars Pizza, Quiznos, Walgreens, Checker Auto, UPS, Barbacoa Mexican Grill -- a Salt Lake City-based restaurant chain -- and 14,000 square feet of office space for CPAs and insurance agents.

Hulbert said he is still seeking additional retailers in electronics, bakeries, restaurants, banks, clothing and shoes.

Thomas Fox Properties, co-owned by Hulbert and Bret Fox, develops commercial retail projects in Roy, St. George, Oregon and Texas. Big-D Construction is the project's general contractor. Leasing is being handled by Russ Harris and Rich Robins of Coldwell Banker Commercial NRT.

The Highland Marketplace project is part of the city's efforts to create a viable downtown area. On Monday, Highland city officials will hold a groundbreaking ceremony for its Town Center project, which includes city hall, offices, a library and a justice building.

"This event reflects a vision for downtown Highland city. Many cities around the country are trying to create their downtown -- here in Highland, we're creating one for the first time," Highland Mayor Jay Franson said at the Marketplace groundbreaking ceremony earlier this week.

"When Highland city commissioned a market study to determine if there was enough demand for another shopping center, they found there was need for a total of 600,000 square feet of commercial space because Highland will be a community of about 25,000 by 2017," said Barry Edwards, the city's administrator.

"Our general plan survey showed most people approved of expanding commercial space in the S.R. 92 and S.R. 74 intersection. And Thomas Fox was the only developer that was able to get control of all three land parcels there," Edwards said. The city, which has a population of 15,000, currently has 120,000 square feet of commercial space including Lone Peak shopping center.

"Alpine and Highland have developed as bedroom communities over the past few years. Most of Highland residents' shopping dollars have been going to American Fork, Draper's South Towne Center and even Provo," Edwards said.

Hulbert said rapid growth in the northern Utah County area including Alpine, Cedar Hills and Lehi would feed the new retail development.

"The household income in northern Utah County is among the highest in the area, over $119,000 per household. And that's expected to increase," Hulbert said.

Within a three-mile radius of Highland, the population in Alpine, and portions of Cedar Hills and Lehi are expected to jump to 58,509 by 2012 from the current 44,000. Within a five-mile radius, that's expected to jump to 132,504 in 2012 from 102,775 currently, he said.

Highland city and its school district also will be beneficiaries of sizable property and sales tax revenues.

"When our project is fully occupied and completed, property taxes will be between $400,000 and $450,000, and the city and school district will get a sizable chunk of that. Sales tax revenues generated between $2.5 million and $3 million, of which Highland would get $200,000," Hulbert said.

This story appeared in The Daily Herald on page D6.