After last year's unrest, some businesses rebuilt. But many have not recovered

Inside of a burned out building
The interior of the destroyed Hexagon Bar in Minneapolis on May 29, 2020. A year after the unrest that followed the murder of George Floyd, some businesses are still trying to recover.
Judy Griesedieck for MPR News 2020

Many stores and other businesses along a busy commercial corridor in south Minneapolis have not recovered one year after riots and looting. But some merchants have been able to leverage grants and other aid to keep going, and even expand.

Phoebe Nguyen has a new store selling skin and hair care products at the Mall of America, miles from her original location at Midtown Global Market. She credits people living above her store for keeping damage to some broken windows, although the new business, open just months before the pandemic, suffered.

“The effects for me was … not just effects of the damage to the building itself, but it was the whole community being blocked off. It was just really sad to drive through and see how everything was boarded up.”

Nguyen’s business, Herbal Alchemy, was among those selected to spend six months rent-free at a “community commons” inside the Bloomington, Minn., mall. After that, she used some grant money and savings to move into her own location on the second floor of the mall in April.

Phoebe Nguyen, business owner
Business owner Phoebe Nguyen stands inside her new store at the Mall of America in Bloomington, Minn., on May 20. She also owns a store in Minneapolis that saw some damage last summer.
Nina Moini | MPR News

She says she knows she is among the lucky business owners, despite a rocky year. And she has no plans to leave her original location in south Minneapolis.

”I hope that it gets rebuilt better, with chaos and coming out of that, there is always opportunities to be better,” Nguyen said.

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Minneapolis business advocates say rebuilding, especially for properties that were leveled by fire, will take five to 10 years. City officials and fundraising groups have calculated the total cost at around $500 million to be shared by 1,500 businesses. But fundraisers have only secured a fraction of what they say they need.

Allison Sharkey, executive director of the Lake Street Council, said it will likely take a state or federal disaster relief package to make a full recovery.

“So far, disaster relief has gotten caught up in political issues around police reform and around city versus rural conflict, so we are hoping that everyone can continue to focus on these actual entrepreneurs who have lost almost everything,” Sharkey said.

Grassroots efforts have raised more than $50 million toward recovery so far for all of the impacted areas. The goal, Sharkey said, is to hold onto local businesses and affordable commercial spaces, while giving preference to business owners within Minneapolis’ communities of color.

Olivia Rodriguez owns El Rey Car Audio on East Lake Street with her husband. She’s been renting her space, but since June she used more than $60,000 in grant money to replace what was lost and then purchase a building a few blocks away.

The looting of the store a year ago still haunts her. Speaking in Spanish, with one of her employees, Jesus Coria, interpreting, Rodriguez had tears in her eyes as she remembered losing almost all of her inventory. But she is grateful for the customers who continue to support the small family business.

The space she’s currently leasing has security bars. When Rodriguez moves into her own space she will have to figure out an affordable way to effectively secure it.

Sharkey pointed out that many business owners also have to factor in the pandemic and rising construction costs when deciding what to do next. Many businesses also discovered they were underinsured, delaying cleanup for some.

It’s not clear how many damaged Minneapolis businesses have reopened. City officials did not provide that information before this story was published.

According to figures from January, of 261 St. Paul properties affected by civil unrest, around 73 still need repairs and 35 are either vacant, condemned or boarded.

North Minneapolis businesses were hit as well. While fewer businesses were damaged than along Lake Street, Sharkey said a history of disinvestment in the predominantly Black neighborhoods on the north side makes for a compounding effect.

Sharkey hopes state lawmakers will consider a relief package for the Twin Cities in their upcoming special session. A funding effort by Minnesota state House Democrats failed earlier in the session.