Downtown Council seeks more retail in Minneapolis

Downtown Minneapolis is seeing a booming residential and employment base, and officials want to see retail growth to match.

At Wednesday’s annual meeting of the Minneapolis Downtown Council, business leaders reported the downtown area added 6,325 new residents in 2018, up to 49,721. There are 6,025 businesses located downtown, including 12 that employ more than 1,000 workers. In total, 205,653 people work in the downtown core and surrounding neighborhoods.

In addition to ongoing office and residential development, downtown saw several new retail additions in 2018. Nick Pechman, president of downtown jewelry store JB Hudson, listed several notable arrivals during Thursday’s meeting, including new stores for Faribault Woolen Mill Co. and Love Your Melon. High-end menswear store MartinPatrick3 completed its fifth expansion, including a JB Hudson popup store, and now totals 22,000 square feet on Third Avenue.

Still, downtown officials think there’s room to grow retail downtown, especially on Nicollet Avenue. A new working group released its first report in January showcasing the demographic and economic case for additional retail investment, based on 2017 data. An updated report with 2018 figures is expected in the coming months.

Recent downtown retail expansion has largely been in the North Loop, home to a wide variety of boutique stores, or of “service retail” such as grocers and drugstores for downtown residents. That still leaves a niche for Nicollet as a true downtown retail hub, Downtown Council President and CEO Steve Cramer said in an interview.

“I think it’s an expectation of a strong, healthy downtown, which we certainly are in almost every respect, to have a retail core,” Cramer said. “We do have a growing residential population, and they can benefit from more than just the service retail we see right now.”

Speaking at Wednesday’s meeting, Mayor Jacob Frey noted that residents are no longer clamoring to move out to the suburbs, but instead are seeking the kind of connected community that can only happen in the urban core.

“They want to live in a beautiful diversity of people and backgrounds where you can walk down the street and have a thousand different tastes and smells and sounds and people all packed in on the same block,” he said.

The council is particularly focused on Nicollet between Fifth and 10th Streets, a 0.4-mile stretch that once was the city’s hub for department stores. Over decades, those stores left, culminating in Macy’s closure in 2017. Many of those spaces remain vacant, in part because they are designed with large floor plans and well-spaced entrances poorly suited to current retail trends.

“[Nicollet] used to have one kind of retail identity in the past,” Cramer said. “That’s not coming back, but there can be another retail identity, and it can be even stronger going forward.”

Several projects are already underway to make that happen. The former Dayton’s store at 700 Nicollet is in the midst of a $250 million renovation to add new retailers, office space and a 40,000-square-foot food hall. The former Barnes & Noble in RSM Plaza is similarly changing, with a steakhouse on the ground floor and smaller retail spaces on the skyway level. The vacant Sports Authority store in City Center could host a variety of pop-up stores during April’s NCAA Final Four men’s basketball tournament, an effort the Downtown Council is supporting.

Minneapolis doesn’t necessarily need Nicollet to rival New York City’s famous Fifth Avenue shopping district for high-end luxury goods, Cramer said, but he still thinks it can, and should, become a signature destination for retailers and customers to gather.

“I think people would actually be surprised at the amount and diversity of retail that already exists in the Fifth to 10th area, and that’s a base we can build on,” he said.

More:

Yes Mpls 2017 Downtown Retail Report

A revolving door for retailers on Nicollet Mall

Marketing the Dayton’s Project in downtown Minneapolis