The effects of COVID-19 and the state of commercial real estate development post-quarantine have yet to be fully measured and understood, but it is safe to assume that family-operated, street-level restaurants, retailers and small businesses have been particularly impacted.
This vulnerability is of course a national and even global trend, but in Detroit, many of those business owners who have been greatly impacted are our friends and neighbors. It has been incredible to watch Detroit’s ingenuity as many local brands and entrepreneurs have adapted their business model and outreach methods to meet the current daunting challenges.
Take for example Vibe Ride, a local cycle and fitness provider that opened its doors just prior to COVID-19 taking root. Owner Latricia Wilder effectively adapted her business model and now successfully caters a variety of fitness classes digitally to a national audience, which would be a difficult route to navigate for any start-up, let alone one so recently launched. Remarkably, this is just one example of countless similar narratives taking place across Detroit and the nation.
Local entrepreneurs have been doing what they do best and staying nimble so they can continue offering their goods and services. Now, we all need to do our part to support them. At Bedrock, we are taking a page from our tenants’ book, and adapting our business model to meet the needs of the businesses within our portfolio that have made downtown Detroit a destination for dining, shopping and entertainment, so we can all get through this unprecedented time together.
Our Chairman Dan Gilbert founded Bedrock with a clear focus on Detroit and small business, and with this in mind, Bedrock is this week rolling out Bedrock Relaunch, an expansion of the tenant support program we began in March.
This program embodies Dan’s mindset by allowing retailers and restaurants across the Bedrock portfolio to fully focus their resources and time on reopening their doors – by removing rent as a barrier to moving forward. Through Bedrock Relaunch, we are offering eligible restaurant and retail tenants the option to temporarily waive base rent, and instead leverage a sales-based lease structure that will adjust rent to a continuous 7 percent of gross monthly sales through the end of 2020.
Why? Three reasons.
- Ten years of progress pre-COVID saw Detroit unemployment shrink from 25 percent to 7.8 percent, along with consistent job and annual wage growth. The sooner businesses are back up and running, the sooner that momentum can continue.
- Even when all business sectors are permitted to reopen, that won’t mean an immediate return to pre-pandemic sales volume, so we are building in what we feel is an appropriate period for business to ramp up.
- The most important reason: Small businesses, both within the central business district and throughout Detroit’s 139 square miles, are what make Detroit truly special. It will be their products, services and grand ideas that will bring visitors and shoppers back to the city, and again position Detroit at the forefront of innovative business development.
We are not alone in working to help businesses reopen safely and successfully. Thanks to Mayor Duggan’s leadership, we were proud to join a coalition of more than 40 public and private partners to launch the city’s Detroit Means Business program, which offers critical resources from PPE procurement to a small business reopening playbook.
But the most important part of our collective success is us! As local businesses begin to open their doors, they are depending on all of us to walk through them – six feet behind the person in front of us, of course. Let’s not let them down!
It will take the entire community to help preserve the tenacious community of small businesses that we depend on to make Detroit a place where we all love to live, work and play.
Matt Cullen is the Chief Executive Officer of Bedrock, Detroit’s largest real estate developer. A native to the city, Matt also serves as Chairman of the Detroit Riverfront Conservancy, Volunteer President and CEO of the M-1 RAIL Streetcar initiative (QLine), Chairman of Invest Detroit and Vice Chairman of the Downtown Detroit Partnership. When he’s not leading Bedrock’s development efforts, he’s usually following U of M football with a glass of red in hand.