Medford's new food co-op aims to open its doors in the Hubbard's Ace Hardware building in 2007, bringing local and organic food to downtown.

The Medford Market is finalizing its lease agreement with the Seus family. Bob Seus and his four siblings, Mark, Dan, Paul and Leslie, own the building on the northwest corner of Main Street and Riverside Avenue.

Paige West, vice-president of the co-op's newly formed board, said the organization hopes to sign the lease this week.

"We definitely can't say that it is a done deal," she said.

The Medford co-op will offer a variety of products with an emphasis on natural, organic and locally produced food, and membership is voluntary.

But the store's opening hinges on local support.

"We need to have community equity," she said, adding that they need to raise $500,000.

West said the Hubbard's site has the feel of a market in an urban center.

"It's got a lot of character inside and outside," said West. The 100-year-old building has pressed-tin ceilings and its original wooden floors. The building has 8,000 square feet on the first floor and 9,000 square feet in the basement, and it already has an open floor plan, so there won't need to be a lot of demolition.

The grocery store will feature a deli and will offer community cooking classes in the basement.

The building's roll-up door and freight elevator, along with its proximity to Medford's downtown parking structure, make it well suited for a co-op, said West.

Once the lease agreement is signed, the organization will kick off a large capital-raising campaign.

The market needs to raise around $500,000 through "subscriber loans" ­-- low interest loans raised from Medford Market members and the community. Such members number 135 now, and the board aims to increase membership to 500 by Jan. 1. Members pay $100 to join.

Erik Wallbank, board president of the Ashland Food Co-op, is the project manager for the Medford store. He said he bought a $100 membership at the Ashland store, and received a $180 dividend check last year.

"It's one of the best investments you can make," he said.

Velda Welch, Medford Market's board president, said the payoff won't be so high at first for the new store.

Medford Mayor Gary Wheeler is among the 135 members of the Medford Market.

"I think it would be a great addition to downtown," he said.

He said he thinks part of the success comes from all the help from the Ashland Food Co-op.

"The nice thing about a cooperative like this is you get others helping," he said.

Bob Seus sees the market and the building as a "great fit."

"This is a can't-miss spot," he said. "Location, location, location — that's the key."

Seus said the Highwaters Nightclub and Lounge will remain on the second floor. Façade improvement work on the building, with assistance from the Medford Urban Renewal Agency, will get under way this week, he said.

George Kramer, historic preservation consultant who also works with MURA on its façade improvement program, has been working on the Hubbard's building project. He said there hasn't been a grocery store downtown since the Groceteria, located at what is now the Southern Oregon Education Service District at 101 N. Grape St., closed in the mid-1970s.