Downtown Hartford’s retail and restaurant scene is seeing a slight uptick in activity lately, but high vacancy rates are still plaguing the central business district indicating that a full scale recovery still appears to be far from a reality.
Empty storefronts have been a long standing problem for downtown Hartford in recent years, as businesses have shut their doors or been skittish about opening in an uncertain economy.
Hartford’s commercial rental rates, above average office space vacancies, and limited downtown population beyond the regular work week has also made retail a tough sell.
But that doesn’t mean there isn’t activity.
In 2009, 40 percent of downtown Hartford’s half-million square feet of retail space stood vacant, according to city estimates. Two years later, those numbers appear to have shown some improvement, although the addition of the Front Street entertainment district, which remains completely vacant, muddies the water.
In recent months, however, at least a half-dozen new businesses have opened their doors or signed leases to occupy downturn Hartford real estate. And brokers say they are getting more interest from prospective tenants today than they were six months ago.
“I’m getting calls every single day for people interested in downtown Hartford,” said Jeremy Felt, a real estate broker for SullivanHayes.”But not a lot of tenants are qualified enough.”
Among the new downtown tenants is Parvin Pooya, whose small business Tea Haunt Canvas recently opened on Trumbull Street. Pooya, who is from Iran, said her art gallery and tea house aims to add something different to Hartford by highlighting the cultural significance of art, which she handcrafts.
Her business also offers patrons tea as well as Persian cookies and pastries, and hopes to serve as a unique alternative for business meetings as well.
Pooya said she chose the Trumbull Street location because of its proximity to the XL Center, Downtown YMCA, St. Joseph’s College, and many office towers. She’s trying to tap into the daytime foot traffic that downtown offers, but her biggest challenge will be getting a community largely focused on work to take time out of the day to appreciate art as well.
It’s a business concept more typical in Boston or New York City, than it is in Hartford, Pooya admits. Still, she is optimistic.
“A tea house is something different for downtown,” Pooya said.
Felt, the real estate broker, said a lot of the interest he is seeing is from people wanting to open new restaurants, which have fared fairly well in downtown Hartford throughout the economic downturn.
Several new restaurants have opened successfully in the past few years including Salute on Trumbull Street and Zula on Main Street. Felt recently completed a 4,200-square-foot lease with the owner of Hartford’s Brazil Grill, who plans to open a new Brazilian restaurant on Pratt Street called Rio Grill.
Another Brazilian eatery, Churrascaria Braza, also recently announced plans to open a restaurant on Constitution Plaza in the space formerly held by Spris restaurant, which closed last year.
But Felt said he still runs into a lot of prospective business owners who can’t get the appropriate financing or haven’t done enough homework to assess the viability of opening downtown.
While, for example, some prospective tenants think they can handle downtown rental rates, they don’t take into account other costs, like taxes, insurance and common area fees, that could tack on thousands of dollars in costs.
“That runs a lot of people off,” Felt said.
Other interested tenants Felt said he has heard from include educational facilities like technology and culinary institutes, banks, yoga studios, and pizza shops.
“Activity is certainly not full tilt, but I expect more leases signed next year,” Felt said.
Downtown Hartford was once a vibrant retail destination home to shopping centers like G. Fox and the Civic Center Mall, which had local and national retail stores.
But that was in the past. According to the 2009 assessment by the city, 203,000 square feet of the 511,000 square feet of retail space in the center of the city was vacant. Most of the vacant space was concentrated on downtown’s four key retail corridors: Main, Trumbull, Asylum, and Pratt streets.
Many vacancies still remain in those areas but there appear to be fewer empty storefronts. The recent opening of the vacant 60,000 square foot entertainment/retail corridor on Front Street, however, only adds to the empty space.
Broker Daniel Dori, whose firm Eagle Rock Retail is handling brokerage services for Front Street, said Hartford has had a proven track record of successful performing restaurants downtown. But the big challenge that remains is getting people downtown late night and on weekends, which would drive retail and entertainment activity.
“When there is an event or game, Hartford is lively and busy,” Dori said. “When that‘s not happening, it’s a challenge.”
Front Street has had its difficulties. The long-awaited project finished construction in 2010 but remains vacant. Spotlight Theatres Inc. announced in March plans open a movie theater, which is still expected to happen, Dori said.
Construction could begin within 30 days, he added.
Meanwhile, Dori said he continues to have talks with other possible tenants including restaurants and a live music venue and he hopes to have two new tenants signed by the end of the year. Still, deals are taking longer than ever, especially as access to credit has become more difficult for businesses, Dori said.
“We don’t want to put in a tenant that is already on every street corner,” Dori said. “We need to make sure this project has its own identity.”
Erin Pollard, the executive director of Business for Downtown Hartford, said there has been an uptick in activity lately with about a half-dozen new businesses opening or signing leases.
Most of the activity is coming from experiential retail — things people can’t buy or experience online — she said.
Besides Rio Grill and Braza, The Russian Lady recently opened its doors on Ann Uccello Street, and Burger Baby is building out on Asylum Street, space formerly occupied by Mayor Mike’s restaurant.
Longtime downtown tenants have also recommitted to the city. Webster Bank, for example, which has prime retail space in City Place II on Asylum Street, renewed its lease for five years in March for $34 per square feet, according to an appraisal report from Italia & Lemp. There’s also been a reshuffling of existing tenants, most noticeably the Tobacco Shop and The Perfect Look Salon, both of which vacated retail space connected to the Bank of America Building on Main Street after facing stiff rent increases. The Tobacco Shop has since found a home on Pratt Street, while The Perfect Hair Salon reopened on Trumbull Street.
The city suffered a major setback when the Market at Hartford 21, which opened earlier this year with much fanfare and hundreds of thousands of dollars in city support, abruptly closed last month.
The Market is seen as a key linchpin in adding to the vibrancy of downtown and trying to attract people from outside the city to visit Hartford.
Peter M. Standish, the senior vice president of Northland Investment Corp., which owns a significant portion of downtown real estate with retail vacancies, said his company is “committed to reopening the market.”
