Columbus’ elected leaders want to help female entrepreneurs and minority-owned businesses set up shop in brick-and-mortar downtown spaces.
To achieve that goal, Columbus City Council is taking steps to open a new downtown marketplace, Councilman Nick Bankston said. The marketplace program would include graduated rent support, a tenant renovation fund and technical assistance.
Plans are still in the early stages and an exact location for the market has yet to be selected. But Bankston said the goal is to find an area that already has retail activity, and serve as a “catalyst” for continued growth of both the tenants and downtown Columbus.
At the end of this quarter, the city will begin seeking an entity to offer the technical assistance. That entity could also serve as the master leaseholder for the facility, or two different organizations could be involved.
Once responses come in, Columbus City Council would need to vote on the contract recipient.
The program is one of a few ongoing efforts to spur downtown’s growth and development, particularly in the wake of the Covid-19 pandemic.
“We want to take the risk away from locating your business downtown,” Bankston said.
Bankston expects the city to commit three years of support to the marketplace and its tenants, with additional locations possible in the futre.
He said studies show that the first three years for a new business or an expanding business are the toughest. If the public sector, during those years, could bring rent to a more achievable price and provide technical assistance, those small businesses would have a better chance of success.
Here’s how the program would work: A private third party would own the property, and lease it to the small businesses. The ideal property would be a downtown building with space for several retail storefronts on the ground floor. The city would provide rent assistance to businesses leasing the space. Those business would pay rent on a graduated scale: perhaps 50% the first year, 70% the next and 90% the third.
The city expects to assist 10 small businesses, which would cost about $150,000.
The city also plans to identify a third-party that could provide technical assistance, which could include support related to business plan development, marketing, finances, accounting, establishing mentoring relationships, legal needs, technology services and training on a variety of best practices.
The city is preliminarily proposing a $1 million grant fund that could support up to 10 renovations of retail storefronts. The grant would be given to the third-party leaseholder to directly work with the developer on completing the renovation.
All told, the program is expected to cost somewhere between $1.3 million and $1.8 million, according to a city council spokeswoman, depending what is appropriated for the support services.
The city is developing an application for small businesses who might want to be part of the center. Plans are to curate the business lineup to offer different kinds of retail in the hub; spaces would also only be available to women- and minority-owned business for at least 10 years.
If the first marketplace goes well, Bankston said the city could support up to three such hubs at one time.
City staff analysis shows that if the city invested $150,000 in the first year, it could spend $90,000 and then $30,000 on helping with rent as the small businesses progressed. That would open up funds for the city to invest in a second and/or third location, spending up to $150,000 in the first year for each location helping with rents.
The city also hopes to have most of the businesses come online at the same time so that they can feed off of each other and create a sense of place.
“We want to try to create a retail destination in downtown,” Bankston said.
The city-supported marketplace won’t be the only program aiming to support small downtown retailers.
The Columbus Downtown Development Corp. recently opened Common Thread, a new fashion and retail district near Main Street.
Bankston said this idea is perfectly in line with what the city hopes to do.
“We want to build on strength,” Bankston said. “It would be ideal to build on existing retail clusters.”
The city program’s official announcement will happen Tuesday evening during an event focused on small businesses.
“This program is important because our economic development strategy has to be around placemaking,” Bankston said in an interview with Columbus Business First. “We still need to focus on bringing in jobs, but we need to also attract people to live in Columbus, and we do that by creating vibrant neighborhoods with retail and amenities.”