Denver Lays Out Incentives to Revive Downtown Retail

The city of Denver has trotted out sweeteners to entice businesses to set up shop in its struggling 16th Street pedestrian mall downtown.

The incentives, paid for by the city, aim to help fill the one-in-three empty storefronts in the 1.25-mile promenade on 16th Street from Civic Center to Union Station to draw more shoppers and diners, the Denver Business Journal reported.

Like other U.S. downtowns suffering since the pandemic, the Mile High City recognizes its 43-year-old mall must be filled with enough shops and restaurants to draw foot traffic.

Late last month, the 16th Street Mall was 30 percent vacant, with 22 empty storefronts containing more than 77,000 square feet, according to the Downtown Denver Partnership.

Denver leaders say they are making meaningful gains in finding tenants.

The retail incentives seek to build on momentum from new events and rebranding of 16th Street that begin May 31, when the city will reopen most blocks along the pedestrian mall, ending years of construction costing $175 million.

One of the largest inducements for prospective tenants hoping to rent ground-floor shops and restaurants along 16th Street is an incentive equal to $25 per square foot of their leased space, annually over four years, funded by the city’s Downtown Development Authority. The maximum per business is $450,000.

Since November, Denver has awarded close to $875,000 in financial incentives and grants to 16th Street businesses, including $760,000 to ground floor tenants.

The special financing district is taking applications from developers who want to redevelop 16th Street properties, drawing from $570 million expected to be generated from the Downtown Development Authority’s expanded boundaries.

Landlords and tenants can also access other business incentive programs, most of them unique to the mall, according to the Downtown Denver Partnership.

Mark Sidell, president of Gart Properties, owner and manager of the Denver Pavilions, said the express permitting incentive has helped garner retailer interest.

“I think our momentum is building again in a positive way,” Sidell told the Business Journal. “We did have to reverse the trend. It was […] not positive, but we’re now heading in a positive direction.”

Other cities, such as San Francisco, are pouring a similar energy into reviving downtown businesses.

Allies of newly elected San Francisco Mayor Daniel Lurie are raising funds to more quickly plant trees, lend money for small-merchant capital projects and provide bridge loans to retailers who want to open businesses downtown.

— Dana Bartholomew