Jun. 2—TRAVERSE CITY — The city’s downtown retail incubator project needs a resuscitator, as members of the Downtown Development Authority board consider pulling the plug on the project.
Cass Street Marketplace, a 1,900-square foot commercial space in the Keen Suites building along Cass Street just south of Front Street, is sitting empty. Plans to create a retail incubator to help small retailers get their businesses off the ground continues to lag as the busy summer tourist season gears up.
The DDA Board’s Finance Committee discussed the project at a recent meeting and directed interim CEO Harry Burkholder to gather information on the additional steps needed to get the site up and running after months of delays, or investigate terminating the lease for the space, according to committee member Scott Hardy.
“We questioned, at that point, whether we’re throwing good money after bad,” Hardy said. “I don’t want to keep throwing money at something that we’re going to pull out of in a year.”
The DDA has been working on the incubator project for more than two years. In April 2023 the DDA Board agreed to spend $87,000 to renovate the 1,900-square-foot space, dubbed Cass Street Marketplace, and approved a 10-year lease for $54,000 a year with Keen Technical Solutions which owns the building. The DDA has been making $4,500 monthly lease payments to Keen since last June, Burkholder said.
The project is funded with $50,000 from the DDA’s Moving Downtown Forward TIF budget, plus an $80,000 grant from the U.S. Department of Agriculture, along with additional public funds from the Michigan Economic Development Corp. secured by 20Fathoms. It has a first-year budget of $136,000. Burkholder said the USDA grant was, in part, for renovations at the Keen Suites building and hasn’t been tapped yet, and would be returned if the project doesn’t go forward.
The incubator was originally slated to open last November, but the opening was delayed to spring 2024 to target the busier summer retail season. The space did host a pair of single-day “pop-up” events in December and February for several local small businesses, but the permanent opening for now has been pushed back again to a still-undetermined date.
“We’re looking at all angles of the project,” Burkholder said Friday.
With the uncertainty over the future of tax increment financing in the city and the DDA’s Moving Downtown Forward TIF plan in political limbo, Burkholder said the DDA doesn’t want to establish a facility without a long-range financial plan to keep it operating. He’s still hopeful that the incubator can open, but said the project is up in the air.
“It’s about getting the short-term and long-term funding in place to get the incubator open,” he said. “I think the board has to look at some budget priorities going forward … There’s going to have to be some key decisions made over the summer.”
One of the participants in the pop-up events expressed frustration with the delays at recent DDA Board meeting. Julie Miller-Lober, who owns Freshwater Trading Co. which makes handmade bath and body products, said would-be retailers in the space are anxious to open, but aren’t sure where to turn to get answers on the next steps. She said she’s attempted to contact Nick Beadleston, executive director of Commonplace Community Coworking on Eighth Street who’s serving as a consultant to the DDA on the incubator, but hasn’t gotten a response.
Commonplace has a $10,000 contract with the DDA to help launch the project and provide entrepreneurial training for incubator businesses, plus another $5,000 to assist with future operations.
“We’re a group of motivated people ready to move forward, but we’re not sure who’s driving the bus,” Miller-Lober told the board. “The management relationship is not working.”
Beadleston this week declined to comment on the reasons for the delays, and referred questions to DDA staff.
“Commonplace has been proud to support the DDA in the early planning stages of their retail incubator space concept,” Beadleston wrote in an email after declining an interview. “We are also proud to have helped host multiple retail pop-up events which have increased visibility for numerous fantastic home-grown northern Michigan small businesses.”
DDA officials said they still support the incubator, but may not have the capacity to make it happen.
“I think the concept is a good idea,” Hardy said. “I don’t know if it’s something we’ll be able to bring to fruition.”
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