Downtown Iowa City looking to diversify retail options

After a challenging 2020 which saw foot traffic hit an all-time low in typically vibrant downtown Iowa City, leaders are optimistic the tide is finally turning. “The weather’s changing, so we’re seeing a lot more people coming out, which is really fantastic. And the environment is certainly changing for the better,” said Nancy Bird, executive director of the Iowa City Downtown District (ICDD). “We have a small semblance of normalcy here a little bit; we’re planning for a good summer and things ahead.” The organization is planning several strategic retail investments that will help fill current vacancies, give financial support to new merchants and preserve spaces that don’t currently have a commercial kitchen. The Retail Space Build-Out Grant program includes $15,000 grants to newly signed soft goods retail leases within the downtown district. This type of direct financial assistance could be very beneficial to an emerging retailer or an independent who has another store, Ms. Bird said. “As soon as they sign a lease, they have some opportunity to create a store that works for their product, and add some ambience that really creates a certain experience and allows their brand to really shine,” she said. “When you have a little bit more than what you thought, you can just do a better job at it. We think these are critical improvements because when people walk into a store, there’s a certain feeling they get right away.” The grants can be used for whatever the store owner feels needs to be done in the space, whether it’s lighting, refinishing floors or a certain kind of furniture that makes their setting pop, Ms. Bird said. “We haven’t put a lot of strings around it, because we want to make sure that it’s flexible for them,” she said. “Whenever you’re opening up a new store, there are really no wasted funds. It all goes toward something, so we hope that they can use it well.” Diverse retail mix While the COVID-19 pandemic has impacted every industry segment, Iowa City’s restaurant and hospitality sectors were hit especially hard. About 10% of the district’s restaurants, which make up 85% of the market, closed for good and another 10% were sold to new owners in the past year, Ms. Bird said. “Hospitality has certainly been tough as the lack of visitation impacts everybody coming in and out of those hotels,” she added. “So, that’s been a hard industry to come back, because a lot of those conferences and things still aren’t online.” Soft goods retail was also impacted, but many owners were able to pivot and reach their customers in alternative ways, such as online or through pick-ups, phone orders or texting. The ICDD would like to expand its soft goods retail offerings, especially in vacant spaces that are not suited for a restaurant. “We know that the vacancies that have occurred over the past year, some of them don’t have a commercial kitchen hood. That’s always been important to us, to keep those spaces flexible, so that retail can enter the market,” Ms. Bird said. “Now we just want to make sure that we’re ushering retail back into those locations that did close.” Examples of available spaces are the former Tailgate location at 30 S. Clinton St. and the former Daydreams Comics location at 21 S. Dubuque St. Bringing back the base A diverse mix of stores and restaurants is only as vibrant as its customer base. And during the past year, that base has been decimated as COVID-19 restrictions limited employees, residents, visitors and one of downtown’s biggest drivers – the University of Iowa. “All of the visitation that happens with the University of Iowa, whether it’s through the academic side or through the athletics department, those people coming and going are constant,” Ms. Bird said. “And, so, with all of those pieces interrupted, it impacted almost every segment of our town and the community really.” While UI students were back on campus starting last fall, there were still a lot of online or hybrid classes, which kept them at home. “When it comes to retail, there’s a certain market that the students drive, and it’s primarily with some of our restaurants, sweet shops and coffee shops,” Ms. Bird said. “Pizza, beer and coffee – those three things are really student-oriented.” However, while some of the retail elements of downtown serve the student population, many shops that feature items such as children’s apparel, jewelry, home and kitchen accents are primarily community-based for faculty, area employees and residents. “That’s the market that will be important for them to really hit as the new stores come in and existing stores kind of recalibrate how they best access their customers,” Ms. Bird said. The new “homebody economy” will be one of the biggest challenges facing retailers as people have become more comfortable just staying at home during the pandemic. “But with that came a lot of savings. There was a lot of money that people were saving because the future was unknown, and no one likes to spend in those environments,” Ms. Bird said. “Now people are ready to go out and shop. When you get back out to see people, you have to refresh a little bit. It’s just starting to loosen it up now.” Strengthening the destination Although the past year has certainly taken its toll on Iowa City’s retail sector, there have been bright spots with more on the horizon. Target opened its new downtown store last August and Tiki Tacos ‘n’ Burgers ‘n’ Wings recently opened next door to it on East Washington Street. Prairie Kitchen Store opened in the former Motley Cow Café on Linn Street and the Webster restaurant plans to open in the Northside neighborhood in May. A groundbreaking was held earlier this month on a new $54.4 million redevelopment on the Pedestrian Mall. The area will include new housing and new storefronts for small businesses, an expanded Reunion Brewery restaurant and five-vat brewery, and a new home for Iowa City’s Riverside Theatre. It is scheduled to be completed at the end of 2022. “Strengthening the destination of downtown will be a big piece of when we can tackle the list of projects and investments,” Ms. Bird said.  “I don’t really have any doubts that we will return to some extent, to where we were in 2019. I think our goal is to see if we can capitalize on more and come back stronger.”