Iowa City Offers Grants for Retail Businesses

In Iowa City, IA, empty storefronts are plaguing the downtown streets. The same is true in other towns throughout the United States. Most of the empty storefronts are related to fallout from the COVID-19 pandemic. However, some have been empty for years, going back to the Great Recession. According to Vera Gross, who owns property in Iowa City, the pandemic had a big effect on occupancy rates. That's why the city is offering grants of up to $15,000 for business owners to move into the vacant spaces.

How the Pandemic Affected Storefront Properties in Iowa City

Gross owns a storefront in the downtown area of Iowa City. One was a retail business where a sports store used to be. The business had been there for seven years, but it closed last year. The pandemic was likely the last straw for the struggling tenant. Gross also owns two apartments in the center of Iowa City. Her tenants moved out because they wanted to move back in with family members and feel safer. She is not certain whether or not the pandemic itself was the cause, but she believes it at least contributed to the loss of her tenants.

About the Retailers That Vacated Downtown

A lot of factors have led to the closure of retail shops in downtown areas of cities. The internet is likely the biggest factor. People can comparison shop, find what they want and get it delivered to their mailbox or front porch without having to leave their residence. Tailgate, which was the retail tenant of Gross, left in March. The closure left her in search of finding a new tenant. Iowa City is now offering $15,000 in grant funds per business for retailers who will sell soft goods in shops in the center of the city. Soft goods include gifts, housewares, clothing, accessories, linens, shoes, toys, games, books and similar small consumer goods.

About the Grant Opportunities

The grants offer retailers an opportunity to build a business. They can use the funds to set up a sweet shopping experience. The funds can be used to buy display shelves and cases, racks or other hardware. Funds can also be used to pay for painting, lighting, interior signs and similar items. If a business owner is low on cash, the grant could fill a gap between their business loan and their cash on hand. According to Nancy Bird, who is the Iowa City Executive Director of the Downtown District, the grant funds could be the difference in a person starting a retail shop and not starting one because they don't have the right amount of cash to physically prepare the retail environment.

How Many Iowa City Businesses Have Closed

In the past year, about 8% of Iowa City's central food and beverage businesses have closed. Another 10% of those businesses were sold to other owners. About three times that amount of retail businesses have closed in the past year. Combined, retail and restaurant businesses in Iowa City have a closure rate of about 25%. According to Bird, the retail market is struggling. Restaurants can set up food delivery, but that's not an option for an independent small business owner.They have to compete with big online businesses, such as Amazon, that do offer private front porch delivery services. The city will keep on trying to find ways to support independent retailers, and these small business grants are just the start.

What Property Owners Hope for

Gross is still hopeful that the grant will encourage a new business to rent her retail property in the center of Iowa City. She would love to lease the property as quickly as possible to a responsible tenant. She knows that it is wise to wait to find a tenant that has a solid business plan in hand. Any potential small business owner who is interested in the grant funds can go to the Iowa City Downtown District’s website to get additional details about the grant funds. The applications are to be submitted online, and grant funds will be issued in the form of a check within four weeks of approval. The city would like to see storefronts getting filled by the summertime. The city would like to see a variety of businesses open in the downtown area. A mixture of retail and restaurants would encourage more people to go to the center of the city and spend some money at those establishments.

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