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July 8, 2013

Hartford retail initiative building up slowly

Contributed Rendering Hartford Prints is one of the four retail businesses scheduled to open in downtown Hartford soon, as part of the city's iConnect project, which is providing free or reduced rent to tenants on a trial period basis.
HBJ Photo | Mike Corasaniti Kristina Newman-Scott, Hartford’s director of marketing, events, and cultural affairs, and Rory Gale, Hartford Prints’ creative director and studio chief, stand on Hartford’s Pratt Street where several iConnect retailers will soon open.

A new program providing free or reduced rent to retailers in downtown Hartford is getting off to a slower than expected start as planning and landlord negotiations are taking longer than expected.

Still, the initiative, known as iConnect, is being heralded as an innovative way to fill vacant storefronts and bring a higher concentration of retail activity to downtown Hartford.

The goal, officials say, is to create a more fertile environment for prospective retailers by offering rent-free space on a trial basis, with the hopes that businesses will gain enough traction to become permanent tenants.

“Change takes time, but this is a good opportunity to start,” said Kristina Newman-Scott, Hartford's director of marketing, events, and cultural affairs. “Ideally, this works and the stores will be able to open as permanent fixtures.”

iConnect has been in the planning stages for months and is part of a broader strategy to breathe more life into a stagnant downtown retail environment.

More than 40 small businesses applied to the program, but only four will participate to start.

Within the next month, Hartford Prints, Farm Shop, Naturally Cats and Dogs, and National Exhibitions and Archives should open storefronts on Pratt, Trumbull, and possibly Main streets, Newman-Scott said.

The program will also assist the opening of a pop-up marketplace and a remote WNPR broadcast studio, which will share a co-work space created by digital agency Deft Collective.

Originally, retailers were to be given an eight-month trial period with free or reduced rent, but that has been shortened to six months due to longer than expected negotiations with landlords.

Though parties involved have reacted positively to iConnect proposals, factors such as the novelty of the program and the rent-free introductory period are making negotiations more complicated, Newman-Scott said.

“This program is the first of its kind in Hartford, and landlords need time to wrap their heads around it,” Newman-Scott said. “It has been delayed because the conversations with landlords have taken longer than hoped, but we're all learning. We're still completely within the time frame of our grants and still confident that this program will have an impact.”

The state and city are providing $165,000 in grants to cover administrative, marketing, and program costs, as well as utility and other expenses for the new businesses during their trial periods.

Grant money will not be used, however, to directly cover rent costs, forcing landlords to temporarily cede free real estate.

Besides spurring retail activity, iConnect also aims to leverage the city's arts scene. The pop-up marketplace, for example, will offer goods made by local artists.

“Hartford has a legacy of innovation that was once its hallmark,” said Maribel La Luz, spokeswoman for Hartford Mayor Pedro Segarra. “The iConnect project is part of Mayor Segarra's vision for economic growth and job creation. It offers a glimpse of the vibrancy we're aiming for in the Capital City.”

iConnect participant Rodger Phillips, who owns Farm Shop, an organic food provider, said he was attracted to the program, and downtown Hartford, mainly for the rent assistance.

“Free rent is probably the No.1 benefit that got our heads spinning and really thinking about this as an option,” Phillips said.

Phillips said he was still waiting on specifics on the rent assistance midway through June as negotiations between the city and landlords were still ongoing. The shorter than expected trial period is not an issue, he said.

“The main investment that we're going to put into this is our time, and we're going to try to make it work for the time that we have,” Phillips said. “It's just something we're going to have to work around.”

Downtown Hartford's retail scene has been struggling for years with high vacancy rates. Empty storefronts exist on nearly every major downtown thoroughfare as some retailers and restaurants have found it difficult to stay in business.

The high vacancy rate, realty experts say, is largely driven by a lack of permanent downtown residents and unrealistic rent demands from certain landlords.

“There are real concerns about retail in Hartford,” said Jeremy Felt, a real estate broker with SullivanHayes Cos. in Farmington. “There is a lot of work that needs to be done.”

Without a large permanent resident base, Felt said, downtown Hartford retailers don't have a steady flow of business outside the normal workday.

Many property owners, Felt said, also have hopes of landing major national franchises willing to pay a premium to be downtown, but that has not been Hartford's sweet spot.

Although some national food chains like Quiznos, Starbucks, and Burger King have found a home in the central business district, many experts believe the city would be better served by attracting smaller retailers.

That is one of the goals of iConnect.

But some small retailers are priced out of the market because of high rent demands, Felt said.

Still, some iConnect businesses could succeed if they provide residents with unique services, he added.

Naturally Cats and Dogs, for example, which will be a pet food store, will offer a service Hartford currently doesn't have.

Newman-Scott said she recognizes the issues with Hartford's retail scene, but she is also optimistic about the future.

With at least 1,000 new apartment units expected to be built in the coming years, UConn moving its West Hartford campus downtown, and the transfer of thousands of state employees to the central business district, new retail activity should emerge in the Capital City, she said.

“Maybe we're not a retail district right now, but we're definitely an arts and entertainment and dining district,” Newman-Scott said. “A project like this is a great opportunity to bring together retail and our artistic community.”

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