Is This Downtown Cleveland's Retail Moment?

Post-pandemic, there are high rents and vacancies, but some businesses are betting on Downtown’s promise

click to enlarge The 5th Street Arcades, a longtime center of small business, has seen numerous comings and goings since CBRE took it over in December. - Mark Oprea
Mark Oprea
The 5th Street Arcades, a longtime center of small business, has seen numerous comings and goings since CBRE took it over in December.
All Clevelanders suffer a burden of benevolence, an endless debt to repay the city, to contribute to its never-ending narrative of redemption. You can see that in John D. Rockfeller’s Beaux Arts tower on West 9th. It’s there in Jeff and Tom Heinen, who, after some necessary nudges of confidence from city boosters, opened up their grocery store in the former Trust Building in 2015.

And you see that quality in Joe Deinhart. A 59-year-old coffee entrepreneur with 30 years under his belt, Deinhart spent most of his career cutting teeth on the wholesale end of roasted beans. If you’re a local, or simply well-traveled, you’re bound to have sipped a blend from Deinhart’s Solstice Roasters. (He ballparks about 225 clients.) “High-end restaurants, country clubs, yacht clubs, Cleveland Museum of Art, Cleveland Clinic—the Bean’s Café in Chardon,” Deinhart said. “You know the Smith’s Boat House in Troy, Ohio? They have our coffee.”

In early 2020, Deinhart found his sea change. With hotels and offices dark, the pandemic slashed 90 percent of Solstice’s business. Deinhart was also, well, somewhat bored. He felt he’d come to conquer the service industry. “When Covid hit, I actually went, ‘Okay, look. I need a whole new spiel here,” he said. Some months later, Deinhart was tipped off by a developer friend that the Peterson Nut Building on the corner of East 9th and Carnegie was up for sale. That’s when Deinhart had his moment, so to speak: With its high-profile location and iconic sign, the Peterson Building was, and still is in the recesses of our minds, a staple of Cleveland nostalgia.

In April 2020, Deinhart signed a lease for $2,400 a month, and moved in that August. “It’s sort of the story of what’s great about this town,” Deinhart said. “I picked this building, and, to make a long story short, I thought, ‘Well, let’s go for it. Let’s open up a storefront.’

“It sounds corny as hell, and it is,” he added. “It’s kind of to give back to Downtown Cleveland.”

Deinhart’s devotion to what has long been the emblem of Cleveland—what lies below the Downtown skyline muraled ad infinitum—is shared by a growing sect of small business owners hyped up by the prospect of growing Downtown’s core. Beyond sound profit margins, businesses like Solstice are moving Downtown with the hope that they’ll catch the rising wave of the 3.2-acre area’s vision as a residential neighborhood, not just a stale Central Business District marred by the pandemic.

click to enlarge Joe Deinhart, the owner of Solstice Roasters, in his new roastery off East 9th and Carnegie in February. - Mark Oprea
Mark Oprea
Joe Deinhart, the owner of Solstice Roasters, in his new roastery off East 9th and Carnegie in February.

Hopefully. Interviews with a dozen real estate brokers and Downtown advocates suggest the city’s center is either bound to suffer a forever deadening effect from its loss of office workers, or, with those shiny new highrises, will attract enough residents to jumpstart a fresh era in retail. Maybe. Possibly. Definitely? “Real estate is an ecosystem that is reflective of our business climate,” Nate Kelly, the president of CRESCO Wakefield, told Scene. “So, right now? Retail is weak. Our office sector is weak. But surprisingly, our residential sector is strong. All three of those [have to be] firing on all cylinders. So, it’s a vicious cycle.”

In 2019, an estimated 90,800 workers came Downtown most weekdays for office jobs. The pandemic changed that, and now, as of January, just 49,940 make the daily trek, a 45 percent decrease.

Today’s retail vacancies could be a reflection of lost daytime foot traffic. According to the Downtown Cleveland Alliance, 14 percent of the 1.6 million square feet of Downtown’s retail space sits empty—3 percent more than before the pandemic. A Scene analysis of recent data from Loopnet, the Zillow for business, found 54 total retail spaces empty, the majority of those sitting quiet below new, glass highrises and legacy buildings on Superior and Euclid. (The Superior Building, for what it’s worth, has a total of 66 vacant spaces up for grabs.)

Pandemic finger-pointing aside, Downtown Cleveland may have its own particular hurdles. According to a January recovery report from Downtown Indy, the retail sector in Indianapolis’ 28,989-person Mile Square is 4 percent vacant; in Pittsburgh’s, which 21,526 call home, it’s 7 percent, according to the Pittsburgh Downtown Partnership. Closer to home, over in Shaker Square, some 13 percent of the neighborhood’s stores are empty, according to directors Tania Manesse and Joy Johnson.

All this data, in the mind of Audrey Gerlach, is more relevant than it once seemed. Gerlach, the Downtown Cleveland Alliance’s vice president of economic development and chief of staff, spends a lot of her workweek attempting to connect the analytical dots between what Downtown is and what it could be for prospective businesses. DCA even hired a retail specialist, Jonathan Stone, as a sort of liaison to sell the area to entrepreneurs as a place worth investing in. (Downtown’s rents are currently, on average, according to CBRE, about $14/square foot, $2 to $3 higher than the city as a whole.)

“That’s something we didn’t have to think about before the pandemic,” Gerlach said, at a meeting table on DCA’s third floor, across the street from the vacant 925 Building. “But now, every tenant is looking at, ‘Well, what’s the point of going Downtown? Nobody’s back to work.’” Her tone intensified. “Well, we have 60 percent of our office people coming back on any given day.”

Stone, who segued from DCA’s marketing department last year, doubled down on the pandemic mindset’s pull. He said he helped manage the Downtown Recovery Response Fund, a $1.45 million pot distributed to 88 local businesses, most of whom had their shops pummeled by protestors during the George Floyd civil unrest in 2020.

But, “if a business owner is coming to us, saying, ‘We have interest in Downtown,’ that’s something we hold onto,” Stone said. “We do our best to get them here. If one space doesn’t work, we go to the next one.”

That’s precisely Deinhart’s experience. Before landing Peterson, Deinhart spent 12 years roasting beans out of a nondescript factory building on 23rd and St. Clair and looking for new digs. He had been negotiating a lease for a storefront on Ontario, yet seeing its windows bashed turned him away. He wanted a better space, specifically one that catered to the public. It was high time.

Even if books don’t end up balanced. “It’s a rule of thumb: A coffee shop costs $500 a day to run,” Deinhart, a loquacious man who apologizes frequently for talking too long, said one January afternoon as in front of Solstice’s counter. Other than the occasional truck delivery out back, or the hum of the espresso machine, Solstice is mostly quiet. “The average person who walks into a Starbucks spends about $5.50. So the question is, after your cost of goods, your labor, your rent—can you get 100 people through the door a day?”

Deinhart looks across the barren, concrete sidewalks of Carnegie to the Hilton Garden Inn, a Solstice partner and nearby benefactor. He nodded to his roastery, and said, “If I couldn’t run that out of the back, then I wouldn’t be in this space. Because I don’t expect 100 people to come through that door.”

***
click to enlarge Anji Brooks, the paper florist founder of Love, Anji, closed up shop in the 5th Street Arcades in January. Other than a focus on family, she said, "It was, 'Where's all the foot traffic?'" - Mark Oprea
Mark Oprea
Anji Brooks, the paper florist founder of Love, Anji, closed up shop in the 5th Street Arcades in January. Other than a focus on family, she said, "It was, 'Where's all the foot traffic?'"

In the history of Downtown’s slow rebirth as a residential place to be, there has been no dream more prevalent in the collective consciousness than the one decorated in a red and white neon glow. In other words: an urban, upscale, possibly one floor or two, Target.

And it still is. In February, Scene surveyed some 345 Clevelanders on Twitter and Instagram to gauge their answer to the question, What does Downtown need? In 200 usable responses, 25 percent wanted a “cheaper” alternative to Heinen’s—an Aldi (6 percent), or, say, a Trader Joe’s (12 percent). Six percent see a jazz club like the Bop Stop or BLU+ Jazz in Akron. Five percent, an Apple Store; and a combined 11 percent, mall-friendly apparel: H&M, Nike, Zara.

Clocking in at the top spot: Target, taking 32 percent of the votes.

According to the half-dozen brokers Scene spoke with for this story, a Downtown Target is either an urbanist’s white whale or an eventuality, as Downtown Cleveland Alliance’s projected 2,800 apartments units come into existence by 2030. The rumors, aggregated by journalist Ken Prendergast in late 2021, suggest that Target will entertain talks with the lucky Cleveland broker now that it’s set up shop in Pittsburgh (in 2022), Detroit (in its own City Club Apartments) and soon in Kansas City (which has roughly 7,000 more residents).

“We’re always reaching out to them,” Conor Coakley, a broker at CRESCO, said. “But I haven’t heard updates in a while, though.” (“It’s bullshit,” another broker, who talked only on the condition of anonymity, said. “Target is never coming here.”)

Gerlach, who was hesitant to detail talks with the retail chain, sees Target as more than a flashy brick and mortar. Like others interviewed, she views Target as a near panacea for a collection of ills: a instance of validation for Clevelanders’ inferiority complex, a legit and affordable home goods store, and, Gerlach added, a big city-esque, validating lure for big box chains—Whole Foods? Nike? Nordstrom Rack?—eyeing Downtown for possible expansion.

“When the community tells us that they want a Target, I hear, ‘I want supplies that make it easier to live Downtown within walking distance,’” Gerlach said. “And I think Target’s the blanket solution for that.”

“We’ve talked to other businesses who’ve indicated that they trail other tenants,” Stone added. “The Targets. Walmarts. Apple Stores—those are the anchor tenants. And once we catch those big fish, then we’ll be rolling from there.”

Commenting on the rumors and speculation in a statement to Scene, a spokeswoman for Target said: “[We] work closely with local officials and guests to develop stores that complement and support a community. As Target evaluates new store opportunities, we consider a number of factors, including existing Target stores in the area and how we might be able to serve the needs of a new community with an additional location. The type of store we build is determined by factors such as anticipated sales volume, site constraints and the specific needs of a community.”

Whether validating or not, it’s possible that the 32 percent crying for Target’s attention acts as Cleveland’s 21st century harkening back to Downtown’s retail heyday, to the mid-century glam and convenience of Higbee’s or the May Company. And historically speaking, such numbers were always somehow linked to either Downtown’s booming population or the same sect that fled to its suburbs. From 1954 to 1967, retailers fell from 10,754 to 7,008—then to 2,952 come 1987.

“Retailers clearly followed the area’s population as it moved farther away from Downtown,” an article in Cleveland Historical reads, “but they followed with varying degrees of enthusiasm.”

click to enlarge Gavin Reiland steam-cleans a church hat in the back room at Mike The Hatter, which has been situated in the 5th Street Arcades since March 2020. - Mark Oprea
Mark Oprea
Gavin Reiland steam-cleans a church hat in the back room at Mike The Hatter, which has been situated in the 5th Street Arcades since March 2020.

George Anastasakis pretty much witnessed this shift firsthand. His grandfather, Pete Anastasakis, founded Mike The Hatter in 1937 in a shop on East 55th and Woodland. (There is no “Mike” in the lineage.) In the late 1960s, as Downtown department stores shifted their focus to wealthy suburbanites, the company moved Downtown to Prospect Ave., where they sold everything from wide brims, to fedoras, church hats and a $1,000 Stetson. (They carry, Anastasakis said, “upwards of 30,000” hats.)

In 2008, Anastasakis’ optimism was tainted. Shortly after the Horseshoe Casino moved into the Higbee, he said, Downtown rents went up 20 percent. He relocated Mike The Hatter to a strip mall in Broadview Heights for the next 12 years, until March 2020, when he and his daughter, Stephanie Travers, found a spacious spot in the 5th Street Arcades. “You know, we really don’t like to move around a lot,” Anastasakis told Scene. “We just like Downtown’s dynamic.”

Yet, just like other shop owners, Anastasakis questions retail’s viability, especially on the 5th Street, which, according to four other tenants interviewed for this article, has been lacking foot traffic since 2019. (Anji Brooks, the paper florist who founded Love, Anji, closed her nearby shop primarily because of it. So have three others.) “People used to come here on, like, a Tuesday, Wednesday,” Carlton Story, Jr., Mike’s store manager, said at the register as haberdasher Gavin Reiland steam-cleaned a red church hat behind him. “Now, they work from home—and now they pretty much come here on Saturday.”

So, Anastasakis wondered, will new residents save us?

“I think it’ll be a long, slow climb,” he said. “Just because you live Downtown doesn’t mean you need a hat.”

***
click to enlarge Woodrina Williams opened up Infinite Boutique at Tower City due to an overwhelming since of nostalgia. "To me, it's still like a rose in a concrete jungle," she said. - Mark Oprea
Mark Oprea
Woodrina Williams opened up Infinite Boutique at Tower City due to an overwhelming since of nostalgia. "To me, it's still like a rose in a concrete jungle," she said.
Woodrina Williams’ realization that she yearned to sell couture clothing began to crystallize shortly after she flew to New York in 2020 to save the lives of those stricken by the Coronavirus. A travel nurse from Hough, Williams found herself chatting with other medical personnel from around the country—some who had started salons or health food stores. “It started as a suggestion for me to open up an LLC,” Williams said, cracking a smile, “so that I could write off my taxes.”

In August, frustrated by her career as an acute nurse, Williams found herself leaning on other interests. An East Side colleague, whom Williams preferred to keep anonymous, toyed with the idea of Williams opening a clothing boutique as a second store in her chain. “I thought, ‘I love fashion. I love clothes.’ Everywhere I go, I’m always complimented. People always ask me where I get my stuff from.” Yet Williams and the friend soon came into a rift over “logistics.” Williams sued. She was soon out $15,000.

Months later, Williams founded Infinite Boutique, and moved into a space in the former GameStop in Tower City Center, thanks both to owner Bedrock’s insistence and a deep kinship with the building. Williams often tells the story as such: When she was a teen, her father was murdered. Her mother was drug-addicted, so Williams fled home as a runaway teenager. She came to see Downtown as a necessary place of refuge. “I have to go somewhere where I could be invisible and not really noticed,” Williams said at Infinite in February. A short-haired woman in a black brimmed hat, Williams was reorganizing pieces of chic loungewear with the help of her aunt. “And I’d look at the elegance of the stores here. ‘Oh my god, I just wish this was my life!’”

But Williams isn’t naive. She knows that the Amazons of the world have altered the market indefinitely. Actually, according to a Census study published last April, online commerce spiked 35 percent in 2020, while brick-and-mortar clothing store purchases dropped by 30 (men’s dropped 17 percent more than women’s). “It’s not the same, though,” Williams argued. “The experience of coming in here to buy clothes have helped people solve problems. They might be having a bad day.” She taps three times on the seat below her. “That's why these chairs is here.”

The same reawakened sense of nostalgia is the bulk of the reason Jason Beudert set to open a second Geraci’s Slice Shop off Prospect. His shop in Willoughby had grown wildly, yet Beudert, who’s spent the past 20 years in Cleveland, saw tagging off the former Vincenza’s space—which had developed a legacy in the Gateway since 1993—as a sort of narrative extension. “Another page in the book,” he said, “of the great restaurants around here.” (That’s partially thanks to Guardians’ Manager Terry Francona, who invested “quite a bit,” though Beudert won’t say how much.)

But Beudert doesn’t want to be Vincenza’s. As this publication has previously reported, pulling back restaurant and retail hours has become Cleveland’s norm since lockdowns forced early closings. When Geraci’s opens in April, Beudert vows to change that course, and keep slices—along with cocktails and Italian ices—going until 1 or 2 o’clock in the morning.

“It’s not just for that [sports] traffic,” Beudert said. “I think there’s a need for Downtowners to have, like, a casual dinner. Maybe watch the game. Have a slice. Maybe a salad.”

And it very well could include Deinhart, too.

click to enlarge Barista Maggie McGervey makes a cup at Solstice Roasters, in February. - Mark Oprea
Mark Oprea
Barista Maggie McGervey makes a cup at Solstice Roasters, in February.

On that afternoon in February, as Downtown’s busiest car traffic roared by spare sidewalks outside, Deinhart continued to set up Solstice for its official public debut. He rejected the idea of a grand opening—“everyone just seems to get overwhelmed”—and preferred to spend his time and energy redesigning Solstice’s old Celtic swirl logo, reviewing final plans for its outdoor blade sign.

“Maybe one day,” Deinhart said in between sips of an espresso made by his barista, Maggie McGervey, whom he’s known since she was three, “we’ll be as famous at the Peterson sign.”

Deinhart disappeared to the roastery, where he usually spends seven minutes roasting Mexican or Honduran imports, along with those from 13 other countries, tearing open 70 kilogram bags. When he returns to the register, ready to show off Solstice’s redesigned packaging, two contractors for the Guardians are waiting, trying to decide what kind of cups they’ll lug back to Progressive Field.

“I’m glad you guys found us,” Deinhart said, seriously chipper. “Can I ask what brought you in?”

“Well, I thought, ‘We’ll try that new place,’” one of the contractors, in North Face and work boots, replied. “We figured we’d stop in. Give it a go.”

“Yeah,” the other contractor said. “We’re looking for a new coffee shop to go to.”

Deinhart smiled. “That’s good to hear,” he said. “That’s really good to hear.”

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Mark Oprea

Mark Oprea is a staff writer at Scene. For the past seven years, he's covered Cleveland as a freelance journalist, and has contributed to TIME, NPR, the Pacific Standard and the Cleveland Magazine. He's the winner of two Press Club awards.
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