Economy in Freefall
On August 27, roughly 15 shop owners and entrepreneurs from northeast Minneapolis convened with state and city officials to tell them just how bad business has been since the collapse of the 35W bridge.
"It's not that we're down 10 percent or 15 percent, but that it's 30 or 40 or even 50 percent," says Mary Colón, owner of the Audubon Coffee shop. "The politicians' faces just dropped, like they were in shock."
In the aftermath of the August 1 bridge disaster, Gov. Tim Pawlenty estimated that traffic congestion and rerouting would cost commuters some $400,000 a day in gas and extra miles driven, but less attention has been paid to the economic impact for businesses in Northeast, Cedar-Riverside, Dinkytown, and other surrounding neighborhoods. While nearly every business took a hit, for some shop owners and businesses, the cost is starting to play out in stark economic terms. Many wonder whether they'll survive until a new bridge is built.
"With the tragedy of the bridge, it seems self-centered to say, 'Look at us too,' because that's a thousand times worse," Colón says. "But the fact is there are several of us who could simply go out of business."
Colón's coffee house is on Johnson Street in Northeast, the area most affected by the traffic rerouting. While the cracked concrete and twisted steel of the bridge site lie two miles away, this commercial and residential strip is still suffering from the fallout. It's not what you see, but what you don't: cars, commuters, and customers. The Audubon, which Colón has owned for 11 years, typically did about $1,100 in business a day, but that's been cut nearly in half. "I don't know if I'll make it," Colón says.
Loren Schirber, who owns Castle Building and Remodeling on Johnson near Audubon coffee, says she put $300,000 into rehabbing the building a year ago. "But now there's nobody up here to even see us."
Caribou Coffee in the Quarry shopping center is also seeing a steep decline in business—about 25 percent, according to manager Kate Deeg. Even big-box retailers like Target, Home Depot, and Rainbow Foods are seeing as much as a 50 percent decline in business, Deeg says. "The Quarry is like a ghost town."
Aside from major rerouting of traffic, another problem is that most people avoid the southbound interstate heading toward the bridge for fear of driving into the scene of a disaster. "It really is a sea of orange cones," says Diane Loeffler, the state representative for the area.
A once-booming business particularly hard-hit is Bobby and Steve's Auto World, a gas station plaza on Washington Avenue situated near a now-closed interstate exit ramp. Steve Williams, who has owned the mega-store since 1998, says that aside from the auto repair shop, Bobby and Steve's relied on highway traffic for most of its sales. On a typical week, the store would sell roughly 60,000 gallons of gas, which has dropped to 47,000 since the bridge collapse. Sales of food and other convenience-store items are also down 25 percent. "But it's that last 25 percent where we make our profit, so our profits are down 70 to 90 percent," Williams says.
Williams is considering help offered by the U.S. Small Business Association, which has disaster relief loans available at 4 percent interest, but he and others are worried about the ability to pay them off even at that favorable rate.
There are small signs of a potential rebound in Dinkytown, which is more of a self-contained community and doesn't rely on destination retail as heavily as Northeast. Skott Johnson of the Dinkytown Business Association says that with the return of students to the U of M campus, business has increased. "It's my busy time of the year, so it's too early to tell if it will last," says Johnson, who has run a graphics and printing shop in the neighborhood for 18 years.
Minneapolis City Council member Paul Ostrow, who represents the affected area, says that he and Representative Loeffler looked into launching a marketing campaign to let people know that the Johnson Street businesses are still open, but money is tight. He hopes the reopening of the 10th Avenue bridge will help spur a revival.
"It's the same with any kind of road construction project," Ostrow says. "You say it will be great when the project's done, but in this case, we're not sure if these businesses will even be around by then."
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