Traverse City Record-Eagle

Business

December 9, 2012

Busy Downtown

TRAVERSE CITY — Seasons change and so does the mix of downtown stores, restaurants and other businesses.

But change isn't as constant as it has been.

Rob Bagicalupi, deputy director of the Traverse City Downtown Development Authority, said downtown commercial property availability is lower than it's been in several years.

"We track vacancy rates, and it's really low," Bagicalupi said. A vacancy rate of 2.2 percent at the end of the third quarter of this year translates to a little more than 10,000-square feet available.

"That's not much," he said.

Bagicalupi readily rattled off open retail spaces, and they are few. The most prime: 207 E. Front, which Leaping Lizard has just vacated; a spot in the 400 block of South Union where Allure Salon used to be (they've moved to 300 E. Front Street; and 201 E. Front, which is the old Federico's Design Jewelers/bank building at the corner of Front and Cass.

"It is generally a good thing that our vacancy rate is so low, but there are some bad aspects to that and that would be as businesses are growing and need to find more space, it's very difficult for them to find space to grow or move into," Bagicalupi said. "And also for those businesses that aren't downtown and are looking for space, it's difficult for them to find space.

"It wasn't a problem when the recession hit — our vacancy rate popped up. But since then it's gone way back down and we're back in that situation where we are short on space."

Dan Stiebel is the Coldwell Banker Schmidt associate broker who represents Mary Bradford of Atlanta; she owns 207 E. Front, Leaping Lizard's former home. Stiebel said there's been plenty of interest in the space from potential new tenants.

"Everything from existing retailers to new retailers, some food-oriented businesses, specialty stores — a little bit of everything," he said. "It's great for landlords to have a lot of people that want to be downtown and want to be in that spot."

Rene Vandekerkhof, office manager for Traverse City Development, which owns Front Street Commons, previously known as the Arcade downtown, said occupancy there has held steady. Several long-standing tenants have moved out, but others have taken their place.

"Typically, we don't have a lot of vacancies," she said.

Jennifer Peck, a commercial agent for Schmidt-Rogers Management LLC for the past four-plus years, agreed that downtown occupancy has stabilized. Schmidt-Rogers manages a good part of the 300 block of E. Front, where the new Northern Natural Wine and Cider House will open in mid-February in space previously occupied by The Chocolate Den.

"When we first started doing the commercial side of things, there were plenty of spots on Front Street and everybody was struggling to get tenants in," Peck said. "But now we're back to full capacity downtown and usually the space is rented before they become available."

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