Sticker shock: Downtown Truckee changing with upscale market | SierraSun.com

Sticker shock: Downtown Truckee changing with upscale market

Rene Shadforth
Colin FisherBusinesses hit with increasing rent and marginal revenues have had to close up shop on Commercial Row in Truckee. The Ponderosa Deli, pictured here, recently closed after a long run downtown.
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A rash of businesses closing up shop in Truckee’s downtown corridor has raised eyebrows around town, leaving residents and business owners questioning whether it’s just tough economic times or skyrocketing rents.Others are wondering, what’s next?”It makes me wonder a little bit when I see a business vacant for a month, like the one across the street,” said Truckee Train & Toy owner Kathe Sorrentino, pointing to the vacant building that used to be occupied by Riverstone, which moved out of Historic Downtown.”It makes me sad, just because I know what it’s like (to be in business for yourself),” Sorrentino said.In the relatively recent past, Historic Downtown Truckee has benefited from a low-to-no vacancy rate. For the past three to four years, less than one percent of the commercial units downtown have been without a tenant, said Tom Watson of Truckee River Associates, the leasing agency for most of the downtown corridor.”We have some blessings in Truckee. It’s a rarity,” he said of the downtown’s low vacancy rate. “To me, it says we’re not meeting the demands of the market.”However, Watson admitted, downtown Truckee is experiencing “more than usual transition.”In recent months, a variety of factors have led to the closure of so many businesses in the downtown corridor, like Thomas Kinkade Lake Tahoe Galleries, The Village Shoppe, long-time Truckee business Ponderosa Deli, and Truckee Books on West River Street.Some attribute many of the closures to the termination of favorable, lower rate leases. Many of the long-term agreements were signed approximately 10 years ago, when Commercial Row property owners and organizations, like the Truckee Downtown Merchant Association, were trying to attract tourist-driven businesses to the downtown corridor.Others say the closures are simply due to skyrocketing rent prices. Many of the retail units in Historic Downtown cost as much as $4 per square foot.At that rate, Sorrentino said it takes her two weeks just to make rent.”I didn’t start [Truckee Train & Toy] to be profitable,” said Sorrentino, adding that she started the business to have a more integral role in the community, “but obviously you have to pay the bills.”Stefanie Oliviari, whose family has owned Cabona’s on Commercial Row since 1918, said “rents downtown have gone off the Richter scale.”Oliviari, 60, has worked in the store since age 9 and owns several units in the downtown corridor. She’s seen downtown Truckee change from serving the locals to catering to the tourists. She’s been a large part of the transition to a tourist-driven economy as one of the original members of the merchant association.The worsening economy, fewer visitors to the area and – according to some sources – the opening of the 267 bypass have caused some downtown businesses to struggle.”[The dip in the economy] encourages the marginal businesses to leave,” Oliviari said. “When tourism and business drops, marginal businesses are forced to close.”Not so, said Cathy Bixler, a former Truckee librarian. Bixler said stores like Truckee Books are forced to leave because of increased rent costs.”I loved spending money [at Truckee Books]. It was affordable. I’m really sorry to see those types of businesses go,” she said. “Things have changed around here.”It’s why, after 20 years of living in Truckee, Bixler decided it was time to leave town for good; she’s moving out of state.In most cases, the closed businesses in the downtown corridor have been replaced by more upscale establishments, like Ponderosa Deli – which will be a fine food and wine shop; Tourist Liquor – now Different People Gifts and Clothing, and The Village Shoppe – now Gratitudes.The Town of Truckee General Plan briefing book refers to Truckee’s downtown as a “regional shopping destination,” a title that makes some long-time locals like Bixler cringe.However, “over the 1994 to 2002 period,” the book continues, “the Downtown has increased its sales an average of 0.9 percent annually after adjusting for inflation.”And despite the sluggish economy, toy store owner Sorrentino said her sales are up over last year’s numbers. Despite her concerns for the future of Truckee Train & Toy and other business in the downtown corridor, she said downtown shops have something to offer that big-box outlets in Reno can’t provide – even for locals: personalized service.”There aren’t too many places you can walk in, have someone help you pick out a gift,” she said, “have it wrapped, and be out the door and to a party in 20 minutes.”