The Dillons store would be the company's first in Lawrence since 1989, when it opened a super store at 3300 W. Sixth.
"We wouldn't proceed with this kind of project unless we felt there was the growth and opportunity in this location," said Dennis Gaschler, a spokesman for Dillons, which is headquartered in Hutchinson.
The project would be part of a larger retail development. The commercial subdivision is being developed at Sixth and Wakarusa by Mastercraft Corp. of Lawrence and is owned by Westgate LLC. Arby's Roast Beef restaurant is located there, and a new Blockbuster video store is under construction.
Gregg Tire Co. also plans to build east of Dillons.
Hy-Vee, meanwhile, is looking to add to its Lawrence presence that begin in 1994, when it opened at Kasold Drive and Clinton Parkway.
The new Hy-Vee also would be accompanied by adjoining retail development, and would become the city's largest supermarket.
Hy-Vee said the store would employ about 450 people, of whom 150 would be on board full-time.
The $10 million Hy-Vee would be built by Hy-Vee Weitz Construction of Des Moines, Iowa, said Ruth Mitchell, the grocer's spokeswoman. It is one of 21 new stores the company is planning to build in 1999.
The adjoining $5.5 million development would include a 15,000-square-foot building for a secondary retail tenant and about 17,000 square feet in a strip-type center, to be developed by R.H. Johnson & Co. of Kansas City, Mo. Johnson developed the strip center adjoining the existing Hy-Vee in Lawrence.