If you’re thinking about moving your business to downtown Salt Lake City, you have the rare opportunity to capitalize on the city’s urban renaissance. With lease prices averaging just $24.81 a square foot in downtown, Salt Lake City is more affordable than a number of competing states, including Denver ($34.62), Los Angeles ($42.60), Seattle ($43.18), Las Vegas ($29.76), Portland ($33.09), and San Francisco ($76.56).
“If it’s a small business that’s looking at our competitors like Denver or Las Vegas, they will find more affordable lease rates in downtown Salt Lake City,” says Dee Brewer, the executive director of the Downtown Alliance.
According to Mr. Brewer, there are significant benefits to locating downtown. Mr. Brewer pointed to the density of businesses centrally located downtown and the collaborative opportunities that may bring. “I have friends and entrepreneurs who, through rubbing shoulders and seeing people at lunch have forged business relationships. There’s that ecosystem downtown that promotes collaboration and cooperation.”
His advice is to take advantage of the density, diversity of audiences and the workforce, and to enjoy the creative components of the city. “Sign a long-term lease,” he says.
Mr. Brewer, who’s lived downtown for twenty years, said his wife was just remarking to him about the joy of living downtown. “She said, ‘I love it. I rode my bike to work, then I went to an African dance class. Then, I rode to the farmer’s market. I came home and that night we walked to dinner.’ That is a way of life that is really attractive,” says Mr. Brewer.
Bruce Bingham is the cofounder of Hamilton Partners, Inc., a real estate development company in the commercial office, industrial, and retail spaces in Salt Lake City. Hamilton Partners was involved in the construction of the 222 South Main building and it purchased several downtown landmarks, including the Boston and Newhouse Buildings, and the Broadway Center.
Mr. Bingham says the US economy is good and there are tax breaks available to businesses that encourage them to do more and do better. Interest rates are still relatively low and there’s an air of optimism throughout the country. “There’s not quite as much regulation. Banks aren’t as stringent and credit is easier to find,” says Mr. Bingham.
There’s a great quality of life in Salt Lake City with a high-quality labor force who are educated and hard-working, he says. He also mentioned the geography of the mountains and the world-class international airport that’s a mere ten minutes from downtown. “Then, there’s the investment that folks have made here in Salt Lake City. Leading that charge frankly is The Church of Jesus Christ of Latter-day Saints.
When the partners at his Chicago-based firm were considering coming to Salt Lake City (none of his partners are members), they said the LDS Church would not let downtown Salt Lake City fail. “City Creek Center proves that. The LDS Church has invested huge amounts of money to prove that.” Mr. Bingham added. “We see a lot of people willing to risk capital and make the most of what they’ve done. The LDS church is leading it, but others are participating in this effort to make the most of a great asset here.”
Bruce Lyman, the leasing director for City Creek Center agrees. “Downtown Salt Lake City is an ideal location for business,” he says. “We are transit-oriented, with TRAX light rail and FrontRunner commuter rail connecting us to surrounding communities. More and more, people who work downtown are choosing to live downtown. Residential development, spurred by City Creek’s condos and apartments, has never been stronger. And no one can beat Salt Lake’s lifestyle: a city in a mountain valley close to skiing and hiking in the Wasatch and just a few hours from red-rock adventures in Utah’s five national parks.
Mr. Bingham says businesses can also take advantage of the graduates from the University of Utah, the airport, the rail connections, and the millennials who want to live downtown. He also says to allow enough time to pursue a variety of alternatives, such as leasing in an existing building or waiting for one to be built.
Nadia Letey, vice president, advisory and transaction services at CBRE SLC says there is a wide range of leasing options downtown. She says the benefit of leasing is it allows people to grow and have flexibility in their business plan. For businesses looking for commercial leases, she says to get a leasing agent. “A lot of people will spend time and energy on their own but in reality, they won’t get a better deal.”
Ms. Letey says to define your budget and what’s most important to your company. From there, determine your options. How close do you want to be to different amenities? Is a Main Street presence important or the periphery? Do you want access to the interstate? “The price point will define your location and quality of building,” she says.
Chris Kirk, the managing director of the downtown office at Colliers International, agrees that Salt Lake City is undergoing a renaissance. He says tech companies are considering downtown because the population wants to live downtown.
“I do represent companies that look at Class A buildings, but some of them don’t want to be in a Class A building. They want a cool historic feel and exposed ceilings have that. They’ll compare a building to a high-rise, but they’ll also consider going into a building that they feel they can get an image that resonates with them,” says Mr. Kirk.
Something’s been happening since we came out of the recession. When the City Creek development was completed, it set the stage for the next several years of companies, he says. “Because of the development, you see Main Street being vibrant again―and that is a big deal. The LDS Church is a very big landlord here and that is a real strength that I don’t think people always understand.”
Another component to the revitalization is the construction of new housing. People want to be downtown and this is a national trend, he says. “Now developers are building housing to cater to that pent-up demand. Downtown’s not only open for business, there’s an energy for those bigger companies to tap into the labor that wants to live here.”
Mr. Kirk’s advice is to look at options and understand which city programs might apply. “Downtown gives you the cache of being in the Capital City. There’s a vibe and energy when you walk out onto Main Street and bump into people you do business with.”
There are numerous resources available for businesses wanting to make the move downtown. Salt Lake City Corporation, for example, assists business owners with the most economically viable resources they need to be successful. “This might include referrals to partner services, access to capital through their loan program, or assistance with the permitting process to ensure that they can open their businesses in a timely manner,” says Roberta Reichgelt, the local business and entrepreneurship manager at Salt Lake City Corp.
“For our department, it is important for businesses to know that they have a resource within Salt Lake City whose objective is to support them and see them be successful.”
Lara Fritts, the director of the Salt Lake City Department of Economic Development says Utah is continually named as one of the best for business, which has put Salt Lake City at the forefront of those conversations. Ms. Fritts advises businesses to engage a broker and to reach out to the Department of Economic Development.
“We have a number of tools that can assist them with the startup or expansion of their business, such as the Economic Development Loan Fund, which loans out up to $100,000 for startups and up to $350,000 if a company has been in business for three years.”
Jim Herrin, the director of the Salt Lake Region Small Business Development Center says, “We have databases that show the demographics around an area, what the demand for certain things are in a particular area, and where the competition is. It shows the traffic information by the facility―all the stuff they need to analyze if a location is going to be good for their business. It confirms what they think or tells them to look at a different location.”
Image credit: Kyle Aiken