Cedar Rapids residents needed to attract downtown grocery: Gazette panel

An influx of people living downtown will help bring in retailers, panelists say

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CEDAR RAPIDS — An influx of residents in the city’s core districts will drive the addition of more retail and a grocery store in downtown Cedar Rapids, business panel members said Thursday.

“It might not be the office or commercial tenants that are going to drive a downtown grocery store. It’s going to be the residents,” said Craig Byers, a sales agent with Pivot Real Estate.

Speaking to about 60 people during a Gazette Business Breakfast event Thursday morning at the Cedar Rapids Public Library, panelists said retail options will come downtown — but only if the people do.

A grocery store is part of a proposal for a 28-story tower, One Park Place, at the corner of Third Avenue and First Street SE downtown.

Cedar Rapids Metro Economic Alliance Executive Director Doug Neumann pointed to Des Moines, which has seen thousands of new residential units come online in recent years. Cedar Rapids, Neumann said, started “far behind the starting line” of Des Moines, which has about 9,000 rental units downtown.

Cedar Rapids has seen its own share of new housing, but only has 1,500 units downtown, he said.

“We’ve got a long way to go to expect the same kind of retail, which will follow the people. It always follows the people,” Neumann said.

A stronger apartment market also can lead to new types of housing development, said Jeremy Tipton, a broker associate with NAI Iowa Realty Commercial.

“Condo markets don’t start until you have an active downtown and an active rental market,” Tipton said.

Mike Draper, the founder of T-shirt shop Raygun, advocated for communities to support local retailers if they want to attract national chains. He pointed to furniture store West Elm recently opening in Des Moines’s East Village, just blocks away from Raygun’s store that has grown to 7,000 square feet.

“A lot of neighborhoods think that it starts at the national level. National competition always follows, it never creates. ... If you are a new neighborhood and there is some risk involved, you should find local people who are going to open up well-run local stores first,” Draper said.

Panelists also noted competition to fill office space in Cedar Rapids. With a lack of big business anchor tenants, new construction often can take tenants from existing structures.

“Because we build a brand-new building, we’re usually stealing a larger tenant from another building and replacing (them),” Byers said. “That secondary building, you try to fill it with (another) office tenant, but many times you can’t.”

That can leave owners of older buildings with the decision of whether they invest in updating or repurposing their buildings, said Gary Becker, senior vice president of commercial real estate for Cedar Rapids Bank & Trust.

“It’s really forcing some competition, especially among the older office spaces. A lot of those exist downtown,” Becker said.

l Comments: (319) 398-8366; matthew.patane@thegazette.com

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