Downtown I.C. businesses look to future amid ‘armageddon’ fears

Tuesday's vote upholding Iowa City's 21-only bar age restrictions will mean closings and concept changes for some businesses, several observers predicted Wednesday, although not immediately.

The reaction from some businesses was grim. One-Eyed Jake's, a bar that opposed the bar age restrictions that took effect last summer, announced a “Death of Downtown Iowa City Party” on its Faceboook page only hours after the votes were counted. Attendees were invited to come to the event Wednesday night clad in black.

Most took a more upbeat view of things.

“I go forward pretty positively,” said Leah Cohen, owner of the popular Bo James bar and dining establishment. “I don't necessarily like what happened, but we have an abundance of energetic entrepreneurs downtown who are able to adapt.”

James said she's expecting unspecified changes in the local retail landscape that will include some bars changing hands or closing.

“We're in the middle of football season, which is probably our busiest season,” Cohen said. “We will be into the holiday season soon, and that's when the students leave town, and then we will be into winter.”

Real estate developer Gerry Ambrose leases space to several downtown bars, including one of the largest, The Fieldhouse.

“They're going to to see some turnover in the retail businesses,” said Ambrose. “There's just no doubt about it.”

Ambrose said only time will tell how the downtown businesses will survive. He said the bar owners opposed the under-21 ban because they wanted younger customers to be able to join older friends for entertainment, not so they could sell them drinks.

“Everybody's going to fight for that 21-and-over dollar and a lot of people are going to lose,” Ambrose said. “A lot of retailers are going to struggle.”

Retailer Mark Ginsberg of M.C. Ginsberg believes warnings of a “downtown armageddon” are overblown. He said small businesses have the flexibility to adapt and change quickly. He predicted the downtown will survive the change as it did the arrival of Coral Ridge Mall more than one decade ago.

Ginsberg said it's critical for the downtown retail community to find offerings that keep it appealing to a young clientele.

“The short-term might be a little painful for us,” Ginsberg said, noting that all retailers are reliant on foot traffic and visibility for business. Some of that traffic has dried up since the under-21 law took effect last spring.

A few signs of financial distress have already emerged for one downtown business owner. One-Eyed Jake's owner Mike Porter has sought bankruptcy protection for two other businesses, MP Investments and Sauce, in the last six months, according to court records. The filings protect the businesses' assets from seizure by creditors while the owners attempts to create a plan of financial reorganization.

Any bars that close are not prevented from reopening under new owners under zoning restrictions passed by the Iowa City Council to reduce the concentration of liquor establishments unless they change uses or remain closed for more than a year, city officials said.

Downtown developer Marc Moen called for engagement between the University of Iowa, City of Iowa City, and downtown businesses to try to ensure that entertainment options remain available to students downtown and that the downtown area remains vibrant.

Cohen said she'd like to see some direct investment by the city into the downtown area, such as helping out with an advertising campaign.

“How do we engage people under 21 at the hours they want to be engaged?” she said.

Without engaging young peope, Cohen said Iowa City will beome a “suitcase town.”

“The young ones go home because there's not enough to do on the weekends,” she explained.