🔒Can downtown Hartford’s thriving apartment market help fill vacant storefronts?

The pandemic’s effects can be seen in the vacant storefronts in downtown Hartford.

But with the many new apartments being built and leased downtown, landlords and city boosters say they hope it’s only a matter of time before those storefronts find new tenants.

“With all those apartments, you’re getting a built-in clientele,” said Kevin Kenny, vice president of Lexington Partners, a major downtown landlord. “That’s one of the major benefits we’re selling.”

To that, he said, you can add the many people moving into downtown Hartford.

Over the last decade, downtown has added more than 2,000 new apartment units, with hundreds more in the pipeline and scheduled to come online in the years ahead.

Despite the pandemic slowing leasing activity last year, most center-city apartments, which have been financed with subsidies from the Capital Region Development Authority, have been able to maintain or return to occupancy rates of 90% or above.

“It’s a lot of people from Boston and New York City who are able to work remotely and want to be closer to family but still crave city living,” Kenny said of some of the newer tenants moving downtown.

Julio Concepción, executive director of the Hartford Chamber, agreed the success of downtown apartments can provide new business opportunities.

“Downtown over the last decade has seen such a rise in residential base so you have that population that’s already here,” he said. “The key is getting them from upstairs to downstairs to have dinner or grab a beer.”

The Chamber on Oct. 21 showcased vacant downtown storefronts in a “Restaurant and Retail Open House.” About 30 people went on self-guided tours of available storefronts, where they could inspect the premises and speak with a property manager.

Of course, vacant retail space isn’t a new problem for downtown. It’s an issue that’s plagued the city well before the pandemic hit Hartford’s shores.

And it’s not clear what the current retail vacancy rate is — it’s a number that’s not been well-tracked over the years, but a walk through downtown shows vacant storefronts on nearly every street.

‘We’re ready’

Among those who attended the recent Hartford Chamber event were Monica Beaudoin and Alex Pilon of Bloom Bake Shop, a popular online bakery. The sisters run it out of a rented kitchen in Hartford but are looking for a permanent space where they can open a coffee shop and expand their menu.

And they’re looking closely at downtown Hartford.

“We really think downtown has a need for a bakery and what we have planned,” Beaudoin said.

“We’re ready to move into a space with a large kitchen and also a storefront for retail,” Pilon added.

The sisters also understand that the many rented apartments in downtown Hartford provide the potential for a strong customer base.

“We know there’s a lot of activity downtown,” Pilon said.

Kenny said Lexington is working with several potential tenants interested in their storefronts, including a sports bar and music venue.

“We’re in the process of signing leases with a lot of interesting new businesses,” he said.

Among the downtown apartment properties Lexington owns or is a partner in are the Sage Allen Townhomes, Spectra Plaza, Spectra Pearl and Spectra Park apartments.

Lexington Partners is also helping lead the $100 million redevelopment of Pratt Street, a project that will count several hundred new or refurbished apartments; 45,058 square feet of retail on Trumbull/Pratt/Main streets; and about 1,000 parking spaces for residents and shoppers.

Filling storefronts

The Chamber event was designed to help fill storefronts that became vacant during the pandemic.

“The purpose is to try to create the vibrancy back into our downtown,” Concepción said. “COVID certainly didn’t help our efforts to recruit more businesses into downtown. This is a nice opportunity to be able to fill up empty storefronts.”

It may have worked with the Bloom Bake Shop.

“We saw a couple of great options ... and we’re eager to move forward,” Beaudoin said.

The city is also working on an incentive/matchmaker plan to help small businesses that are starting up, Mayor Luke Bronin recently said, although details weren’t immediately available. The program will aim to help fill up vacant retail space downtown and in Hartford’s neighborhoods.

“There is an announcement about that program coming soon,” mayoral spokesman Akash Kaza said.

It wouldn’t be the first time the city tried to incentivize retail activity. In 2013, the Segarra administration launched the iConnect program, which offered free or reduced rent on a trial basis, with the hopes that businesses would gain enough traction to become permanent downtown tenants.

It’s impact, however, was limited.

Empty storefronts have also been a political issue in Hartford. Earlier this year several city councilors proposed a measure that would have fined owners of long-term vacant retail properties $100 per day, which raised alarms among landlords and was eventually shot down.

When it comes to filling storefronts, Kenny said Lexington is selective about the businesses they choose.

“We have a reliably good idea, based on the people who live in our apartments, on what would be successful and what wouldn’t,” he said. “It’s important to get the right business in place.”

Kenny said that while landlords were offering incentives last year, those lures are harder to come by today.

“During the height of COVID, landlords were willing to offer discounted rents, free rent periods, or other enticements. Now, as the activity and commitments have picked up, those deals are becoming harder to find,” said Kenny, who added that landlords are still helping with tenant improvements.

Leases for downtown storefronts range from around $16 to $25 per square foot, he said.

Face to face

The open house brought potential tenants and downtown property managers face to face, said Shannon Mumley, director of small business development and strategy for the Hartford Chamber.

“One of the things we’re trying to do is break down the barrier between the property owner and businesses,” Mumley said. “You have to call or email them and wait for a response. But having a day where they can meet the property manager and go in and see the space, that’s what we want.

“This is the first location we’re doing this in, then we’ll go from here to different neighborhoods with a goal of filling storefronts,” Mumley added.

Art Feltman, executive director of International Hartford, a nonprofit that helps immigrants, refugees and other minorities achieve their business ambitions, attended the open house to help one of his clients who owns a pizzeria in Hartford’s south end.

“They would like to do something more upscale, with full table service and drinks, attracting a younger crowd,” Feltman said. “We help them get financing, write a business plan and deal with government regulations.”

When the pandemic hit and people began working from home, downtown businesses were among the casualties. But with infection rates dropping and companies, including The Hartford, announcing that workers will begin returning to the office, downtown foot traffic should pick up, which should help fill vacant storefronts.

“Downtown Hartford gets a bad rap,” Kenny said. “But when you take the amount of apartments that are full and parlay it with the people craving to get back out to bars and restaurants, a year from now it will look like a different place.”