Wal-Mart will open a so-called "Neighborhood Market" with a grocery and pharmacy in Rohnert Park, in the 33,000-square-foot space formerly occupied by Pacific Market, the company said Wednesday.

The development is part of a drive by the world's largest retailer to open more than 200 of the smaller stores within the next year-and-a-half.

Pacific Market closed in early 2011, putting 40 people out of work as Wal-Mart opponents fought its plans to expand its existing Redwood Drive store into a so-called Superstore.

At the time, it was suggested that the prospect of a larger Wal-Mart — which would include a grocery — was a factor in the market's closure.

Wal-Mart officials said Wednesday the retailer still intends to move forward with the expansion, which won City Council approval but was delayed when opponents won a lawsuit challenging the project's environmental report. City officials have said they expect to hear from the company this fall about its next step.

The news of the new market — which does not require city approval because it is similar to the previous use — was greeted practically with cheers by other merchants in the Mountain Shadows Plaza. About seven out of 27 storefronts in the shopping center are empty, including the former grocery space.

"It means everything, really," said Sue Yasinitsky, owner of Puny Paws, a pet supply store. "We've been struggling here for nearly three years without a grocery anchor, and it's been a tough road for a small business."

The Wal-Mart market would "bring new customers to the entire shopping center," said Yolanda Ramirez, owner of Straw Hat Pizza.

But Wal-Mart foes — who oppose the company's business practices and say it is an unfair competitor — said the smaller store was as bad as the larger one they have been fighting against for years.

"We are as strongly opposed to the small-marts as we are to the Supercenters," said Marty Bennett, co-chairman of the Living Wage Coalition of Sonoma County, using a derisive term for the neighborhood market concept.

"In terms of driving down wages and benefits in the grocery industry and in terms of their impacts on local grocers like Oliver's, it's exactly the same," Bennett said.

But Rohnert Park Vice-Mayor Joe Callinan, who lives nearby, said the development was a positive one for the shopping center and the neighborhood.

"I think it's going to be great to have a store in that space," he said. "It's going to really revitalize the area."

Asked if he had any concerns about Wal-Mart still wanting to expand, Callinan said: "I've always been an equal opportunist. The place has been sitting for a couple of years. Anybody can open a store there; that's the great thing about America."

When Pacific Market closed, its owner, Ken Silveira, did not directly assert that Wal-Mart's proposed expansion was to blame. But he pointed to a report opponents commissioned that said a bigger store would drain millions from its competitors and cost 105 to 211 local jobs.

"The irony should not be lost on anyone in the community," Bennett said of the Wal-Mart announcement on Wednesday.

In a statement, Wal-Mart said that the Mountain Shadows Plaza store is anticipated to open in late 2014 and will employ 65 people in a mix of full- and part-time positions.

Wal-Mart critics including the Living Wage Coalition have successfully battled Wal-Mart's efforts to move into Santa Rosa.

The company in 2009 abandoned a five-year effort to build a store in Roseland after it lost an environmental lawsuit filed by various advocacy groups.

Some of those same critics worried in 2012 that the city's relaxation of zoning restrictions might bring a smaller-format Wal-Mart to the former Circuit City building on Santa Rosa Avenue. But the space was ultimately occupied by a Smart & Final.

(Staff Writer Kevin McCallum contributed to this report. You can reach Staff Writer Jeremy Hay at 521-5212 or jeremy.hay@pressdemocrat.com.)