By Gregory B. Hladky
4:30 PM EDT, July 23, 2013
The feds have spent billions on bailouts and handouts for Big Banks, Big Business and Big Agriculture. Connecticut's government has used hundreds of millions of taxpayer dollars sucking up to companies like Jackson Laboratories, ESPN and NBC Sports.
Now it looks like that philosophy has trickled down all the way to our depressed urban centers. Hartford is offering little itty-bitty commercial operations temporary breaks on the rent and other freebies if they'll fill up some of the city's long-vacant downtown storefronts.
It's an experiment, the first of its kind in Hartford (though not in Connecticut). The program hit some road bumps even before it began, and no one is quite sure if it will work long-term.
New London has been doing something similar since 2009, spending about $25,000 a year in rent subsidies to encourage businesses to fill up empty storefronts across the city. Of the 17 pizza parlors, hair salons, and other retail operations approved for funding (not all in the downtown section), 13 are still running, two shut down and two have moved, according to New London officials.
"It's worked pretty well," says Ned Hammond, the city's economic development coordinator. "It's great to see some of the places that are still around."
Downtown Hartford is likely to be a far tougher place for new businesses to survive in the long run, what with its high rents, difficult landlord issues, and lack of enough year-round residents to keep retail outfits running.
New London's rent subsidy program is also longer-term than Hartford's initial effort, which is only promising businesses financial support for the first six months. In New London, a business that qualifies can be assured of rental help for a year or even as long as 24 months.
None of that has dampened the enthusiasm of Hartford officials, who are committing $165,000 in state and city funding to their new scheme to bring a bit of life back to at least a few of those empty glass-fronted shops. So far, they've decided to offer some of the subsidies to just four businesses (of the 40 that applied).
Some Hartford landlords have apparently been reluctant to offer rent-free space even temporarily, and the Hartford program grants aren't going to be used for direct rental subsidies. Instead, the money will go for utilities, insurance, administrative and other costs, officials say.
"We all know not all of them will make it," acknowledges Kristina Newman-Scott, director of marketing, events and cultural affairs for the city. She insists that even if just one of those four small businesses survives, "It's a win."
She calls the initial difficulties — like landlords declining to offer rent-free space even temporarily — "growing pains... It's part of the growing process with this project."
Jeremy Felt is a Hartford-region real estate broker with a rather grimmer outlook. Felt works for Farmington's SullivanHayes Companies, and he says Hartford's commercial real estate market is looking real ugly.
"It's literally the worst I've ever seen... how much downtown retail space is vacant," Felt says. He estimates that 35-40 percent of commercial rental property in Hartford's downtown is empty. "It's strictly first-floor retail that suffers the most."
To illustrate just how bad it is, Felt points to the empty shops near the XL Center (the former Hartford Civic Center). The place is a 16,000-plus seat arena that plays host to a pro hockey team, UConn basketball games, and numerous concerts featuring big-name stars.
"And we can't lease retail space right next to the main entrance?" asks Felt in a disgusted voice. "I can't believe it."
That problem Hartford officials are having getting downtown landlords to help out new potential tenants with initial rent costs doesn't surprise Felt at all. He says most of the city's downtown landlords don't seem to want to give much at all to lure in tenants and fill up some of those vacant storefronts.
"I would say none of their expectations are realistic," says a frustrated Felt.
The real problem, says Felt and other experts, is that Hartford has so few permanent residents in the downtown. "Residents drive business," is the way Felt puts it.
Moving more state employees into the downtown area and bringing the University of Connecticut's local campus from West Hartford into downtown isn't going to be enough to support a resurgence of business in the central city, Felt says.
"Who's that going to help? How many 18-year-old students are going to go out and spend a lot of money?" he asks. Some bars and fast food places downtown might benefit, but Felt doubts that those students are going to "spend $100 at Stackpole Moore Tryon," one of Hartford's premier downtown clothiers.
The four businesses that have agreed to be part of the Hartford program include Hartford Prints, Farm Shop, Naturally Cats and Dogs, and National Exhibitions and Archives. They are expected to be up and open at spots along Hartford's Trumbull, Pratt and Main streets before the end of August.
Also in the works are a "pop-up marketplace," and a remote broadcast studio for WNPR, both to be supported by the new Hartford program.
Rory Gale is one of the partners in Hartford Prints, a letterpress operation that turns out personal stationery and paper goods for weddings and other events.
Hartford Prints will be moving from its current studio at 56 Arbor Street on Hartford's west side, where it's been for one year, to the new downtown location.
(There's another difference with the New London program: New London won't provide rent subsidies for a business that is just moving within that city. "We don't want to take from one landlord to give to another," says Hammond.)
Gale says the plan is for the Hartford program "to cover us rent-free for six months." She adds that, if the business isn't doing well enough to begin paying its own rent after that time, the understanding is the city will try to work something out for more help for a longer period. Gale says she's heard some of those downtown rents can run as high as $3,000 a month for a storefront.
"The goal in this for us is to be a permanent fixture in Hartford," Gale says. The original business plan for Gale and her co-owning sisters Addy and Callie called for opening up a store within the next 5-10 years. The new Hartford program is an opportunity to jump the business way ahead of schedule, Gale points out.
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