More businesses investing in the downtownPublished: 12/9/12 @ 12:09
There was a time in Youngstown's past when downtown was just down. Period. Today, that trend has reversed itself as wave after wave of business relocates and reinvigorates the Mahoning Valley's core district.
However, opinions vary on the success of downtown renovation efforts and the pace and future potential.
Business owners and property developers downtown agree that the area is on an upswing, with development at a pace not seen in decades.
But that momentum and optimism are cast against one overriding concern: It is happening without a collective vision.
Within the last six months, more than 10 projects have been either announced or completed along Commerce, Federal and Boardman streets. Restaurants, bars, retail outlets, residential living spaces and industry-driven projects such as the National Additive Manufacturing Institute are all finding addresses downtown.
At one point, rents in the downtown were only a couple of dollars per square foot and were among the lowest in the nation, said Tom Humphries, president and chief executive of the Youngstown/Warren Regional Chamber.
“You couldn’t get space for that in the suburbs or anywhere else,” he said.
It’s a positive development for the downtown that rents are increasing, and there is competition for quality spaces, Humphries said.
“I came to the downtown in 1997 and the difference between then and now is night and day,” he said. “When you go out now, there’s people and traffic. You used to go down at noon, and there was nobody there.”
As the national and local economies continue to emerge from the recession, a trend toward urbanization is occurring nationwide that mirrors the growth of downtown Youngstown.
In June, the Census Bureau showed that the nation’s 27 largest cities grew faster than their surrounding suburbs at a rate not seen since the 1920s.
“I think this is part of the young professional movement across the country,” said Richard Mills, who as president of the Ohio One Corp., owns several buildings downtown, including the Commerce Building and City Centre One on downtown’s east end. “There’s a lot of interest in moving back to the central cities to work, live and play,” he said.
Several developments have aided growth in downtown Youngstown, Humphries said.
The first was the addition of a public arena, now known as the Covelli Centre. Another was the retention of banks and government workers in the downtown. The Youngstown Business Incubator and other developments added workers and brought customers, he said.
Those entities created the need for restaurants, while the Covelli, along with DeYor Performing Arts Center and Stambaugh Auditorium, helped attract consumers for dinner and night life, Humphries said.
That reciprocal effect will continue to be important downtown, business owners, city officials and proper- ty developers say.
Growing interest and population near downtown have led to more than 5,000 people heading downtown on Friday and Saturday nights, said Imbibe owner and property developer Jeffrey Kurz.
“Back in 2005, when we were first putting the entertainment district together, we envisioned the downtown growing in stages,” Kurz said. “And that has really come together for a nice mix, but we still need more — about five or six more businesses to get it to where we want it.”
Those phases for Kurz included entertainment, retail, residential living and infrastructure that can support daily life, such as a grocery store.
“We need that retail to attract more people from the suburbs. Grey Land is perfect,” Kurz said of a new gallery store that just opened. “The problem though is there’s not a lot of storefronts left.”
The downtown efforts are focused solely on clubs and restaurants, said Barry Silver, owner of Silver’s Vogue Shop, which has been downtown since 1970. There is little support for developing retail downtown, he said.
MORE DIVERSITY SOUGHT
Many say downtown needs more “daytime” businesses, something other than bars, restaurants or nightclubs, to continue developing.
A grocery store such as a Whole Foods or Trader Joe’s would help, said Rocco Sait, owner of Grey Land Galleries, which opened recently in the former site of Wig Warehouse, on West Boardman and South Phelps streets. The business sells artworks by regional artists, industrial and mid-20th-century modern furniture, vinyl records, vintage clothes, high-end vintage sound systems and other items.
Sait said his attraction to opening downtown came through his grandfather, who was a Youngstown police officer for 30 years.
“I heard all these stories about what the downtown used to be with people all over, and I guess I’ve always thought it could be like that again,” he said.
Jacob Harver, who owns and operates The Lemon Grove, agrees with Sait, saying he fears that as demand picks up in downtown, those who worked to bring it back will be pushed aside.
“It’s more important than ever to preserve those elements that make it quintessentially Youngstown,” Harver said. “The downtown was never truly dead. There’s always been a vibrant arts community. When it seemed like a ghost town, things were still going on.”
Harver said a primary factor in purchasing the larger building where the Lemon Grove now does business was “to protect against the downtown becoming gentrified.”
“You don’t want it to get to the point where the people that made this place hip can’t afford to be down here anymore,” he cautioned.
THE GATTA PHILOSoPHY
Dominic Gatta III, who owns the Federal Building and Gallagher Building where Cedar’s Lounge is located, said his goal is to “get buildings developed and occupied.”
Gatta plans to open a high-end burger restaurant and a separate coffee bar on the first floor of the Gallagher Building at North Hazel and West Commerce streets. Commercial offices will be added on the second floor, and 10 apartments will fill the third and fourth floors. He now has 14 apartments in the Federal Building.
Cedar’s will be closed, with plans to open the restaurants next spring.
For now, Gatta is choosing to focus on smaller buildings with a quick window for redevelopment.
“Stambaugh and Wick are enormous buildings,” he said. “It takes the right developer for the right project, and you’re probably going to see a local developer partner with something like a national hotel chain to fill the larger footprints.”
The limited number of spaces remaining have let property owners “get greedy” and push up rents, Silver said.
Rents are going to go up because of supply and demand, said Dominic Marchionda, owner of several downtown buildings including the Wick Building and Erie Place Terminal. Erie Place only has a few of its 40 rental units available.
“There are young professionals who want to live in the downtown and have a fully furnished place with all the amenities,” he said.
Rising rents could move some businesses from the downtown area, but Marchionda said he believes the businesses that helped build the downtown will find a way to stay. It’s a sign of success that rents are increasing, and customers are demanding more amenities for downtown space.
“It used to be you took whatever kind of renter you could get,” he said. “Now we get calls daily from people wanting to live downtown and suburban businesses interested in getting involved downtown.”
Erie Terminal Place, Realty Tower Apartments and the Federal Building have added apartments to the business mix in the downtown.
“We’ve seen a push for new residential conversion — apartment projects like the Realty Towers, the Wick Building and Erie Terminal — which maybe spur other things like a downtown market and potential offshoots for more business,” said William D’Avignon, deputy director of Planning and Zoning for the city of Youngstown.
Residential and business rents in the downtown are significantly higher than a few years ago. The apartments here range between $800 and $1,200 a month for a one-bedroom, Sait said.
Data from the Mahoning County Auditors Office, which assesses property downtown, show that property values have risen.
But hurdles remain in revitalizing the long vacant structures that could one day serve as space for retail outlets or hotels.
DEMAND EXCEEDS SUPPLY
“The demand is far beyond the supply in terms of spaces available,” Harver said. “A lot of these places haven’t been refurbished in decades, and they’re multi-million dollar projects.”
As urbanization continues, many cities have established merchant associations or partnerships that appoint board members to represent business owners. The partnerships prove effective in marketing activities that enhance the distinct identity of a particular downtown and encourage retention and growth of commercial, residential and cultural life.
Over the years, similar groups have formed among downtown business owners in Youngstown but have not lasted, Kurz and Harver said.
For instance, the Youngstown Arts and Entertainment District Association was instrumental in lobbying the Ohio Legislature to amend laws that define an entertainment district, helping reduce the required population from 100,000 to 20,000, Kurz said.
The change allowed Youngstown to qualify for 15 liquor licenses at reduced rates, and it gave rise to the bars on West Federal Street.
“It also provided an inside track to state, federal and private funding,” Kurz said of the money that was used to open up and beautify Federal Street. “But we didn’t do as much as we could have in attracting more money. I think the key is watching how a place like Columbus attracts that sort of money and trying to match what they do.”
Not every business that recently opened in the downtown had the intent to be part of a downtown revitalization.
DEVELOPMENT BY ACCIDENT
Dan Mitchell, who owns Two Guys Clothing with his wife, Kim, at the 20 Federal Place complex, recently opened Two Girls Clothing across from the men’s store.
The couple had purchased Two Guys and had to move the store after the building was sold to a new owner. They found their current location by happenstance, Dan said.
“We looked all over Youngstown for a new location,” he said. “Then a meter maid told us we needed to look at the space here at 20 Federal Place.”