After hitting a high of 9% this summer, the vacancy rate in Burlington’s Church Street Marketplace is back down to 6%. A jewelry store, a coffee shop and a lunch place recently signed leases and plan to open in the next few weeks.
But merchants on the seven-block pedestrian mall aren’t breathing a sigh of relief yet. After a very slow summer, many are reporting a steep drop in profits. They say they’re able to hang on largely because of Covid-19 emergency funding from the state and federal governments. And they’re waiting to see what the foliage season brings before making long-term predictions.
“People are really frightened right now, to be honest,” said Kelly Devine, the executive director of the Burlington Business Association. “What I am hearing from most folks is that they are going to try to stick it out through the holiday season. A lot of folks in restaurant and retail are talking about reevaluating when the first of the year hits.”
Retail and restaurant are the heart of Church Street, a nationally known outdoor mall that is normally home to about 100 stores, restaurants and other businesses, many of them locally owned. Those sectors have been hit hard by Covid-19, and are still operating under occupancy limits to mitigate the spread of the virus. Stores and restaurants can operate at 50% occupancy indoors.
Since the state declared a state of emergency as a result of the pandemic in March, three national chains – The Gap, Eddie Bauer, and David’s Tea – have closed their Church Street stores.
A drop in tourism in general has also emptied the pedestrian mall. Before Covid-19, Church Street was regularly flooded with visitors to local festivals and to milestone events at the University of Vermont. With the northern border closed, Canadian tourism has taken a huge hit. Visitors from many other points are severely limited by the state’s quarantine rules. According to city data, foot traffic was down 30% on the mall in June and July compared to last year.
“We rely heavily on the marathon weekend; there was no marathon,” said Melissa Desautels, who owns the Whim and Dear Lucy shoe and clothing stores. “We rely heavily on UVM graduation, and there was no graduation. It was more like a mass exodus.”
Business at the Danforth Pewter store on Church Street had dropped 70% earlier in the year before creeping up to just about 50% below last year, said CEO Bram Kleppner. The Middlebury-based company recently closed its store in National Harbor, Maryland, Kleppner said. Danforth’s online sales are up 40% this year, he noted.
“Every business owner I know who didn’t have an e-commerce site before this pandemic, has one now,” said Desautels.
Mark Bouchett, who co-owns the Homeport store on Church Street, said during the shutdown he reduced the number of workers at his store from 25 to just five. Now he’s at about 20.
This time last year, Church Street had a vacancy rate of just about 1%, said Kara Alnasrawi, the executive director of the Church Street Marketplace. During the height of the recession a decade ago, vacancy at the mall hit 11%, she said. The 9% rate from a few weeks ago was the highest since the pandemic broke out, she said.
“General business activity is definitively down on Church Street,” said Alnasrawi. “That is to be expected. There are still members of our population who are uncomfortable coming down and being in public.” The drop in tourism overall has been an additional blow.
Devine said recent protests calling for the firing of three Burlington police officers are adding to the problems faced by Church Street merchants.
“People are saying, ‘I’m not coming to Church Street anymore because of the protests,” said Devine, adding protesters had demanded that some outdoor restaurant diners stand up to show support.
“Not all of them are supporting the call of the protesters,” said Devine. “We should have room for different opinions in the community, and the protesters seem to not have tolerance for folks who don’t agree with them.”
Business owners in the hospitality sector are pressing Gov. Phil Scott to ease restrictions on restaurant and store occupancy. The governor has said in recent weeks that helping the sector – the hardest-hit as a result of Covid – is a priority. State officials are waiting to assess the impact of school reopenings on Sept. 8 before making any decisions about easing safety restrictions.
Vermont retail and tourism businesses also rely heavily on how well other states control the spread of the virus. For now, it’s not clear how many people will travel to Vermont for foliage season, the busiest time of the year for some businesses.
Kleppner, of Danforth, said he’s going to wait until the holidays are over to make decisions about the company’s remaining eight stores, including two in Vermont.
“After January I’ll have a conversation with each of them to see how we survive the next five months through Memorial Day,” said Kleppner. “January through summer of next year is going to be a lean few months.”
Devine sees Church Street, which has the highest rents in Burlington, as the most active area of Vermont’s largest city.
“You could even say Church Street is in some ways sort of the heart and soul of the entire state because it’s our most active retail and restaurant and entertainment center,” she said. “I often say, ‘As goes Church Street, so goes the rest of the state.’”
Jeff Nick, chair of the Church Street Marketplace Commission and a partner in J.L. Davis Realty, said he’s hoping foliage tours operate somehow this year. He knows visitors won’t be arriving by bus.
“Hopefully people can weather this thing and come out of it,” said Nick. “If this continues much longer, we could see some more challenging times ahead.”