Business outlook in Palisade not so peachy
A year and a half ago, in the midst of a recession crippling other communities locally and nationwide, Palisade was held up as the little economic engine that could.
Many of its businesses, particularly in the downtown area, were chugging steadily along and churning out tidy profits. While Mesa County, Grand Junction and Fruita were struggling with the largest decline in sales-tax revenue in 25 years, Palisade’s coffers were enjoying double-digit growth over the previous year. Many credited that boon to the opening of Wine Country Inn and a few new restaurants and the marketing efforts of an ambitious chamber of commerce director.
Today, downtown has lost much of its steam.
Real-estate signs hang in empty storefront windows. Roughly one-quarter of the businesses in the heart of downtown have shuttered since the end of the year. The downtown branch of Palisades National Bank, a fixture for more than a century, closed last week. Town sales-tax receipts, while up 6 percent overall in 2010, fell the last two months of the year. The chamber is looking for its third executive director in the past six months.
Some business owners and town officials shrug off the vacancies, saying the turnover is part of the life cycle of businesses and that the recession simply caught up to the east end of the Grand Valley. Some proprietors say their sales are holding steady or have improved over last year.
Others, though, are worried about downtown’s empty appearance and the effect it could have on tourism, upon which the largely specialty and seasonal shops rely. Palisade Town Trustee Jim Harkreader went so far as to declare during a recent meeting that downtown is “dying on the vine.”
“You can be assured that the morale is low downtown with the business community,” Trustee Art Silver said. “They’re running scared because they know we have a tourist season coming and they can just barely make it. But come winter, it’s a killer.”
In response, the town launched an initiative called Brew’n Business, a coffee-and-donuts forum open to anyone and intended to generate ideas on how to enhance the business climate in Palisade. Town and chamber representatives are passing out and wearing “Buy Palisade” buttons to encourage residents to shop in town rather than jump on U.S. Highway 6 and head to Clifton or Grand Junction. And private citizens have joined elected officials in beating the bushes in search of businesses that want to invest in Palisade.
“We just want activity downtown, and it concerns me when there are that many businesses that are empty,” Trustee Dave Edwards said.
To get a snapshot of the state of business in downtown Palisade, visitors and residents need look no further than the intersection of Third and Main streets. The three buildings on those corners are either fully or partially vacant.
The former Tucan Coffee House, on the northeast corner, has been sitting idle for years. The historic yellow brick building on the southeast corner lost one tenant last week when Palisades National Bank closed the branch for financial reasons, and a second tenant, Rapid Creek Cycles, is expected to leave soon and relocate on the north side of Third Street next to the Red Rose Cafe. On the southwest corner, the antiques shop within Mumsel’s Crumpets, Cups and Cones closed at the end of last year.
In addition to businesses feeling the recession’s cold hand on their shoulder, the various stakeholders in downtown say there could be myriad reasons for the recent spate of closures: unsustainable business models, poorly managed operations, old buildings that have structural deficiencies.
Melinda Eastham, who has owned Mumsel’s for 2 1/2 years, said antiques sales were solid last year. But she closed that portion of the business because of sky-high utility bills.
Even with just a small coffee shop in the front of the building, she said her gas and electric bills for the first two months of this year, plus a required deposit, totaled nearly $2,000. She said the century-old building needs upgrades to make it more energy-efficient.
Meanwhile, sales of coffee, tea, ice cream and pastries are off by one-third compared to this time last year. The loss of businesses around her won’t boost those numbers, she said.
“When you lose one business, every business is affected,” Eastham said. “If there are cars on the street, other people will come. If the street is empty, nobody comes.”
Eastham is among many business owners and town officials who fear the ripple effects of the closure of the downtown branch of Palisades National Bank. She estimated four out of every 10 drivers who parked downtown were headed for the bank. Take away the branch, and you might take away four people who might otherwise have stayed downtown to buy a cup of coffee, eat lunch or just browse.
“The closing of the branch sends a tough signal to everybody,” Silver said. “When the branch bank that’s been there 100 years closes, it sends a signal to potential businesses that might be thinking of investing (in Palisade).”
Others downtown see Palisade’s situation differently.
Palisade Cafe and Grill owner Margie Latta said locals, some of whom eat at her restaurant at 113 W. Third St. four to five times a week, keep her business alive. It was that loyal following that prompted her last month to expand operations to seven days a week, just in time for the weather to begin warming up and for her to see bicycle riders resume their trek out to the east end of the valley.
Latta said businesses must figure out ways to adapt to the inevitable wintertime slowdown. For instance, she said she offers discounts to local residents and date-night specials to draw people in from the cold.
At The Blue Pig Gallery, 119 W. Third St., founder and owner Marla Wood said business is down from this time last year. But Wood said she made a concerted effort to maintain rather than reduce business hours for the benefit of her customers. To keep art-lovers coming in, she and other businesses plan to help each other with promotions, events and other marketing ideas. Wood said her affinity for Palisade has led her to rebuff suggestions that she relocate her art gallery to the more heavily trafficked streets of Grand Junction.
“My concern is that this is a flux time for Palisade, which is the most important time to make good plans,” Wood said. “It’s crucial to Palisade’s success that we pursue conscientious decision-making.”
Few business owners have been aboard Palisade’s financial roller coaster longer than Mary Lincoln, who has operated Slice O’ Life Bakery at 105 W. Third St. for 31 years and says business has improved for her so far this year. To her, what’s happening now is little more than a fact of life in the business world. And she believes Palisade is still an attractive place to operate a business.
“It’s a charming community, and it’s not a bedroom community,” she said.
Town leaders, chamber executives and business owners agree they need to boost foot traffic downtown. Most say the way to do that is to attract businesses that offer everyday goods and services, something that, outside Family Food Town, is virtually absent downtown.
“One of the goals historically and certainly now is to develop the kind of critical mass in downtown Palisade that helps all the businesses thrive and grow,” Town Administrator Tim Sarmo said. “We need to offer on a regular basis enough businesses and enough variety in businesses to attract a customer base.”
Sarmo said one local business owner seized upon that idea during last month’s Brew’n Business meeting, noting it would be better for businesses’ bottom lines to draw in 50 people every day, rather than create another event or festival that brings in 5,000 people one time.
Trustee Mike Krueger said Palisade needs to begin constructing a year-round economic base to complement the agri- tourism and specialty shops that thrive six months out of the year but struggle for the balance.
“I think people want to shop local, but it’s difficult,” Krueger said. “Where would you shop locally if you lived in Palisade? Other than the grocery store, what is it that locals would go to downtown (to shop) for?”
The desire to fill that void and infuse the town with more tax revenue has led town officials to try to bring in discount retailer Dollar General. Although the sale hasn’t closed yet, a land development company agreed to purchase a one-acre site north of the Union Pacific Railroad tracks and west of Main Street.
But some people, including those in citizens’ group Citizens for Smart Growth, question whether such a business will benefit Palisade. They see it as a threat to Family Food Town, the only locally owned, independent grocery store in the Grand Valley, and to the charm of Palisade.
“They’re not local, they don’t sell anything local,” said Wood, a member of Citizens for Smart Growth. “The money goes out of the community. To me, it doesn’t represent anything sustainable.”
Silver and others disagree.
“We don’t have the luxury of saying no to them,” he said of Dollar General. “Everything is closing. We have to have businesses. If that’s the face of the future, then that’s the face of the future.”
While multiple downtown vacancies and the potential ramifications of that fact are at the forefront of most everyone’s mind now, there are signs of a turnaround and optimism.
A Peachful Place, a specialty store, recently opened at 109 W. Third St., replacing Purrfect Creations Floral and Gifts, which closed at the end of the year. The turn-of-the-century building that once housed the Palisade branch of the Grand Junction Fruit Growers Association at 244 W. Third St. reportedly sold and will become a bookstore.
And count Tom Ball of Glenwood Springs as one of those who is “bullish” on Palisade.
At the end of December, Ball and his wife purchased the 11,900-square-foot building that housed the downtown branch of Palisades National Bank. The bank still has roughly seven years left on its lease, and Ball said he will talk with new bank owner Community Bank Partners about what it intends to do with that lease.
But Ball already is thinking about future uses of the building. He said it’s set up for an urban mixed use, with residential apartments upstairs and commercial space downstairs.
“I think it’s an underutilized asset, and I look forward to maximizing the potential of the building,” Ball said.
As for greater Palisade, he compliments the town as a “Triple A” community, one that boasts agriculture, arts and alcohol. Whatever strain on business the town faces now, Ball believes that’s a promising combination for the future.
“We will collectively work through it, and I look forward to being a part of it,” he said.