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Sign reading No Loblaws can be seen in the window of a Kensington Market store on Augusta Ave.,Toronto April 04 2013.

Fernando Morales/The Globe and Mail

Loblaws is moving into Kensington Market.

Tribute Communities, a development company in the early stage of a 15-storey condo tower at College Street and Spadina Avenue, says it has reached a deal with the grocery giant that would give it a 20,000-square-foot home on the building's second floor, according to media reports.

The potential arrival of the store has stoked fears from many in the community, who say it will put the neighbourhood's family-run companies out of business.

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The new Loblaw store comes as plans to build a new Walmart in the neighbourhood have stalled, but have nevertheless given rise to the Friends of Kensington Market, which is seeking a greater say in the decision-making process of commercial development.

The building is expected to open in 2016.

Councillor Adam Vaughan, whose ward includes the College Street site, said the commercial use conforms to existing zoning for the location and there is no way for the city to fight the store's arrival.

"We can't choose people's tenants," he said. "We have no leverage to say, 'Do not put a food store there.'"

Mr. Vaughan said he is concerned about the store because it will compete with the dwindling number of small food merchants in the market. "I get very nervous. Kensington needs to be protected," he said.

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