Iowa City aims to attract the right businesses downtown

IOWA CITY - The past several months have been rife with change for Iowa City's pedestrian mall.

Longtime downtown staples such as the Soap Opera and Brown Bottle have announced their closings, while new businesses - ranging from hi-tech software developers to a retro arcade and pizza joint - have opened up shop on the ped mall.

With businesses coming and going, officials with Iowa City's Downtown District hope a recently completed retail strategy plan will provide the blueprints to optimize business types and placement as the ped mall evolves.

The Downtown Iowa City Retail Strategy plan, completed last month by Seattle-based consulting firm Downtown Works, explores the current makeup of downtown businesses and establishes goals for an ideal merchandise mix.

'Now that we understand what our optimal mix is, as suggested by a professional, we can go out and try to achieve that,” Downtown District Executive Director Nancy Bird said.

According to the study, Iowa City's downtown consists of:

' 48 percent bars and restaurants

' 14 percent apparel, shoes and accessories stores

' 17 percent non-retail

' 17 percent other retail

' 4 percent vacant.

The ideal mix isn't too far off, with the biggest proposed changes a reduction in food and beverage offerings down to 40 percent and non-retail use down to 7 percent, while increasing apparel and other retail to 25 percent and 28 percent, respectively.

That ideal mix also would eliminate vacancy in the downtown area, which admittedly is low already.

'Clearly we have a very low vacancy rate, people want to be down there,” Bird said. 'But vacancy isn't the only sign of health.”

To achieve an ideal mix of businesses, Bird said one goal will be attracting the right business types to vacant spaces as leases naturally turn over.

Iowa City Economic Development Administrator Jeff Davidson said in any market, turnover among businesses is common. Fortunately for the downtown area, buildings don't sit vacant very long.

'There's hardly any lag time before the spaces lease up, ...

stores go in and out but they immediately lease back up,” Davidson said. 'That just shows you how healthy the economy is in downtown Iowa City.”

In the past few months alone, local businesses such as the Brown Bottle, Soap Opera and the Wedge Downtown pizzeria have closed.

Owned by MidWestOne Bank, the Brown Bottle space will be used as extra space while construction updates take place at the bank building on the corner of Washington and Clinton streets, said Kent Jehle, MidWestOne Bank executive vice president.

The former Wedge space in the Iowa City Public Library building is owned by the city, and Davidson said that, while several restaurants have expressed interest in the space, city staff want to find the ideal tenant who would be comfortable with a three- to five-year lease.

'We're really trying to kind of sit back and consider what all the options are,” he said.

As for the Soap Opera space at 119 E. College St., next door boutique business Revival will expand into the former soap-and-lotion store in February.

'It will be an additional store,” said Sheila Davisson, Revival founder and owner. 'We will be moving some operations that are here to there.”

Corporate officials with Whitey's Ice Cream, which has been at 112 E. Washington St. since the 1990s, announced Wednesday that the ice cream shop would not return to the downtown store. But they said they hope to remain in the Iowa City area.

Property owner Mark Ginsberg said needed structural renovations are taking place on the three-story building before a new tenant is sought.

But it's not all closings in Iowa City. In late September the Downtown District celebrated the opening of six pedestrian mall businesses within a block of each other, including boutiques such as Catherine's X French Connection and Sicily Boutique, software companies such as Digital Artefacts and MetaCommunications, and the arcade and pizza lounge Forbidden Planet.

'Clearly downtown Iowa City and the ped mall is kind of the living room in the community,” Bird said. 'That investment in the area, all these things are a really positive investment for the business community.”

Other recommendations in the Downtown District's Retail Strategy include hiring a retail recruiter to help connect property owners with the best tenants for their downtown spaces.

Other recommendations include developing a retail design guide to create a more seamless atmosphere between businesses through guidelines for storefront designs, materials or increased transparency and ensuring the continuity of retail in the pedestrian mall.

Iowa City has been investing in storefronts for a few years now with the Building Change program, which provides business owners with Community Development Block Grant or economic development funds to pay for a portion of building updates and enhancements.

In fiscal years 2013 through 2015, the Building Change program has provided downtown business owners with roughly $300,000 to spur more than $950,000 in building improvements.

But Tracy Hightshoe, community development coordinator, said future investment likely will need to take place at the private level, as the Building Change program always was meant to be temporary and might not come around again next year.

'I think it's been well received, but from here on out we have no guaranteed source of funds,” she said.