Many cities envy Madison, WI’s thriving State Street retail corridor. After being converted from a four-lane road to a pedestrian-focused thoroughfare in 1974, State Street has become synonymous with funky retail stores and welcoming locals. It’s a draw for University of Wisconsin students, residents, and visitors alike, and an important economic and cultural asset for the city. According to Downtown Madison Inc.’s latest State of Downtown report, Madison’s Central Business Improvement District (BID), which contains State Street, saw vacancy rates decline from 7.5 percent in 2012 to just 4.6 percent in 2015.
In recent years, however, the mix of retail on State Street has trended toward businesses focused more on food and drink and less on goods and services. According to Downtown Madison, Inc., 40 percent of businesses in the Central BID are food and drink businesses—but only 25 percent are other types of retail. Local leaders are concerned that if this shift continues, the area will fail to meet the everyday needs of local residents.
“Beverage businesses, whether it’s coffee shops or bars, by themselves or in a restaurant, are displacing retail,” says Mayor Paul Soglin, a member of Smart Growth America’s Local Leaders Council. “We’ve had a very significant displacement issue on State Street over the last 20 years.”
To address this issue, Mayor Soglin and his colleague Alderman Mike Verveer have created a new program to support other types of retail along State Street. The Retail Improvement Grant Program provides assistance to retail tenants looking to invest in interior or exterior renovations. Grants are available to offset up to 50 percent of the cost of a project, capped at $50,000. With the goal of increasing locally owned retail on State Street, the grant is only available to independently owned retail businesses who hold, at minimum, a five year lease in the target area.
The strategy uses a combination of common financing tools. The program is funded by a Tax Increment Financing (TIF) district and expands on the popular façade grant that has been active in Madison for over a decade.
For Mayor Soglin, the grant program is about maintaining an economy that serves local needs. “To keep the neighborhood as vibrant as it is, our strategy needs to also be about supporting the local hardware store and the neighborhood bookseller.”
The grant program began at the beginning of February, and applications are now being accepted. Visit the City of Madison’s website for more information.