Minneapolis Downtown Council entrepreneur program gets reboot after stores close

Shalawn Randall thought she hit the jackpot in 2022 when the Minneapolis Downtown Council chose her online boutique as one of 10 businesses it would move into a skyway storefront.

It was a great deal: Rent was capped at 20% of sales for two years.

But skyway retail is a hard business these days, and this week she is packing up her 500-square-foot B’Youtique store in Baker Center. Foot traffic was slow, and sales never hit goal of $25,000.

“I never got to that,” she said.

Randall, who kept her day job as a trust compliance specialist, is now looking for affordable space elsewhere.

With the leases now expiring for participants, the Downtown Council has re-evaluated the Chameleon Shoppes program with major changes.

The program launched in 2019 as a way to plug empty downtown storefronts and at the same time help new retail businesses owned by women or people of color.

The council is adding business training, store location assistance from real estate experts and technical support largely missing from the first go-round.

“The challenge is that the program was smartly conceived of in 2019, pre-COVID, and pre the extreme escalation of change in retail and pre the loss of 250,000 concentrated office workers,“ said Lisa Middag, the council’s senior director of economic development.

The council — and many downtown boosters across the country — believe retail can and should play a strong role in urban recovery, as more workers return to offices and more offices are converted to residential spaces.

Chameleon’s take two began with a pilot project over the past year that brought in consultants to help participants whose leases were expiring. Armed with hindsight, feedback and a determination to fulfill the council’s 2035 economic development and equity plan, the pilot will go full throttle starting Jan. 28.

Chameleon is partnering with the nonprofit Northside Economic Opportunity Network (NEON) to train the entrepreneurs in business management. It is also bringing in real estate experts and consultants to analyze each vendor’s marketing, online websites and operational practices.

“There are some significant changes that have happened and are happening right now, which is why I’m so excited,” Middag said. “We want people to be able to learn from each other, to learn about opportunities. So there’s a level of networking, community building, relationship building, that is very central to Chameleon.”

The Minnesota Retailers Association likes what it sees and is hopeful.

“We’ve have seen the downtown council’s new program, and I do think it’s a really good strategy,” said Bruce Nustad, president of the 1,200-member association. “There still are a lot of aspiring retail entrepreneurs who have a passion for a product, a service, an interest or a hobby they want to convert into a real venture. But oftentimes they don’t have the business background or the marketing [expertise] so it’s tough to make those decisions.”

Chameleon’s new crop of 10 or 15 entrepreneurs — many who now operate online, at farmers markets, through catering jobs or consignment arrangements — will take eight weeks of business classes with NEON instructors.

After completing the course, seven to 10 vendors will be chosen to open a storefront downtown, Middag said. They will receive up to $7,500 in city grants to assist with remodeling, fixture purchases, signage and other costs.

The council also hired consultant Lee Krueger, the president of Krueger Real Estate Advisors, to work with the vendors. He’s the guy who guided 19 start-up firms in downtown St. Paul into stores as part of that city’s downtown recovery program.

He sees his role as one of matchmaker, finding the perfect spot for the businesses.

It’s a tall task.

The pandemic and highly popular remote-work trends shrunk the number of workers and shoppers circulating the skyways. Office buildings in Minneapolis are almost one-third empty now.

Many skyway doors lock at 6 or 7 p.m. since the pandemic started. That limits building access on weekends and nights when shopkeepers might hold events to pull in fresh audiences and bolster sales, Krueger said.

Krueger must find ways to help Randall, Uniquely Global store owner Satiya Amporful and other skyway shop operators get around those and other problems.

Barred access “has been a real bugger for me,” said Amporful, another of the Chameleon participants whose lease expired Dec. 31. The former Navy cryptologist and mother of five runs Uniquely Global in the Gaviidae Common building. She started her business by importing fabrics, custom outfits and other products from around the world.

She now uses the store to create gift baskets for corporations, design and imports handmade custom shirts for executives and others including guitarist Carlos Santana.

Amporful’s participation with Chameleon ended Dec. 31. She has since arranged a new lease with Gavidae’s landlord on her own and worked with security to open skyway doors and get customers to her shop beyond the obvious 9 a.m. to 5 p.m. hours.

She pulls in about $2,000 in sales every five weeks.

It’s not the $3,500 a month she wants. But it is better than the $1,000 she used to make when Chameleon originally placed her store on Gaviidae’s first floor.

“The traffic was dismal,” she said.

After eight months, she was able to grab a space on the skyway level. Sales instantly shot up by 50%.

Real estate location matters a lot, Krueger said. But picking the right location is only part of the formula for success.

Sistah Co-op store in the IDS Center also just shut its doors for good this month. It would have benefited if matched with a location offering a broader audience, he said. Instead, it was placed in a skyway store surrounded by banks.

Down the street, Chameleon shopkeeper Mary Taris runs Strive Publishing & Bookstore on Nicollet Mall. She has roughly 4,000 square feet.

That’s too large, given her business. If asked to pay market rates, she’d have to come up with $1 million just to cover the rent, Krueger said. She needs a smaller space.

Krueger also hopes to help Randall find a better location for B’Youtique.

If the right match is made — and the businesses get other support — perhaps these short-term leases can turn into long-term leases.

Randall sure hopes so, she said.