Rising rent forcing downtown Raleigh businesses to relocate
Posted July 30, 2015
Raleigh, N.C. — Some downtown Raleigh businesses have been forced close their doors because they can't afford the monthly rent.
Now, the growing concern among business owners and downtown planners is how to attract new businesses downtown without running out current tenants
Apartments and condos are fast becoming a part of the skyline, making Downtown Raleigh a fashionable address. However, when there’s such a great demand—and a limited supply—property prices invariably rise.
Fred Montague, co-owner of Lighting Incorporated on Peace Street, said his building was sold amid the rising rent prices.
“Rent has been about $2,000 a month, but we figured it would probably go up to eight or 10,” Montague said.
Natty Greene's Pub and Brewing Company on Jones Street is closing Saturday after five years.
When the building was sold, the landlord decided to substantially increase rental rates. They were too high for Natty Greene's, so the pub will shut down its Raleigh location.
Trig Modern furniture store, located in downtown Raleigh, faces a similar scenario. With rental rates at $17 to $25 a square foot, owner Bob Drake said he can’t afford to stay downtown.
Drake opened the furniture boutique in 2012 and was paying $3,000 a month. Now, Drake will soon have to leave, unable to pay the rent anywhere downtown, making way for new apartments.
Drake said downtown has become too focused on condos and restaurants.
“Those of us who are having to make some changes are afraid that downtown Raleigh will lose its character,” Drake said. “There’s more to retail than just a pint of beer.”
Bill King, development manager for the Downtown Raleigh Alliance, said rising rental rates are a sign of demand in downtown Raleigh.
“In the last month alone, we’ve had three new retailers announce they’re coming to downtown,” King said. “We have a few more on the way. So there are some coming in, but we’re certainly sensitive to the fact that we want to keep the ones that we have.”
King added that city has established a retail task force in hopes of finding ways to keep the mom-and-pop stores in the center city.
Meanwhile, nearly 2,500 residential units are either planned, or under construction.