Emerging from pandemic, Rochester seeks to jump-start its downtown

A person write on the white board
Moderator Bethany Von Steinbergs takes notes during a downtown Rochester task force work session on Feb. 27 in Rochester, Minn.
Ken Klotzbach for MPR News

In an event space on Rochester's main drag, a group of business owners are throwing out words that describe their ideal downtown.

“Historic,” “vibrant” and “walkable” are just some of the terms called out across the crowded room.  

The exercise is part of a series of moderated discussions city leaders are hosting this month to try to figure out what to do with the city's languishing downtown. 

Nearly a decade ago, Rochester's downtown started an epic transformation. It's called Destination Medical Center, an idea spearheaded by Mayo Clinic aimed at making the city's entertainment, arts and infrastructure as highly regarded as the hospital. 

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Community members give suggestions
Rochester business owners and other community members give suggestions at a downtown Rochester task force work session on Feb. 27 in Rochester, Minn.
Ken Klotzbach for MPR News

Luring new businesses and workers in the tech and health sectors is part of the plan, too. 

But eight years in, a gauntlet of roadblocks is stopping the city from getting there. 

“We all know that we have suffered through a very difficult time,” said Destination Medical Center Executive Director Patrick Seeb, kicking off the first session.

The pandemic — and the empty storefronts and reduced foot traffic that came with it — forced businesses to pivot unexpectedly. Seeb says it's a big reason lots of downtowns are facing similar challenges. 

"We're here today coming out of that. And as we enter into this what we call the recovery phase, there probably is a set of immediate action steps that we can take as we begin to rebound,” he said. 

A person speaks on the stage
Patrick Seeb, executive director of the Destination Medical Center Economic Development Agency, introduces the discussion at a downtown Rochester task force work session On Feb. 27, in Rochester, Minn.
Ken Klotzbach for MPR News

Housing, parking and patrons 

But what those steps are depends on who's talking.  

Free parking and fewer hurdles for businesses to open and operate are common concerns. Higher rents as property taxes increase — a result of concentrated new construction downtown — also play a role. 

“All I've seen is change and not unfortunately for the best, or the better,” said Ginny Smith, who has owned a fabric and sewing store downtown for 47 years. 

During the pandemic, she says she had to shorten hours. 

“Now, I have so much trouble finding employees, there's no place for them to live reasonably on the kind of salary I can pay them,” she said. 

And without workers, it's harder and harder to keep the business open. Smith's situation underscores the pressure points in a hard-to-break cycle: If businesses close — or have a hard time opening — it's increasingly difficult to attract people downtown. 

And without foot traffic, it's hard to justify opening up shop in the area. 

A person speaks
Business owner Ginny Smith talks at a downtown Rochester task force work session on Feb. 27 in Rochester, MInn. Just behind her to the right sits Carol Bitton, another business owner who also spoke at the event.
Ken Klotzbach for MPR News

New ways to reach old customers

Carol Bitton is still dealing with staffing issues at her retail store. But the pandemic also forced her to think of new ways to reach her primary customers — Mayo Clinic patients who don't live here. 

She used some COVID relief money to build a bigger online presence.

“I was not computer savvy, nor did my website work well at the time,” Bitton said. “So we took that $2,000 grant and put it into our website. And we learned to use Facebook and social media,” Bitton said — practices she’s still using now even though COVID restrictions have dropped. 

Will Forsman operates three coffee shops downtown. During the pandemic, he diversified his business by launching his own line of roasted coffee — products he can sell in his cafés, but also in retail locations. 

Person at a coffee shop02
Cafe Steam owner Will Forsman makes a coffee drink. Forsman said Mayo Clinic’s decision to allow thousands of employees to work from home meant fewer customers. But more recently the expanding student body at University of Minnesota Rochester has made up for that gap.
Catharine Richert | MPR News

From his flagship café downtown, he's watched the highs and lows of Rochester's transformation play out in real time. The reasons for opening a business downtown now have changed a lot since the pandemic, he said. 

“What was advertised to business owners at that time has changed almost completely, because, you know, we are missing several thousand employees at Mayo downtown every single day,” he said, referring to Mayo Clinic’s decision to allow some employees to continue to work from home. It’s a common concern among business owners. 

But today, Forsman's flagship coffee shop is full. And he attributes the crowd to University of Minnesota — Rochester's growing downtown footprint.

“The students that are now kind of occupying the vacuum that was left by Mayo, also are huge fans of coffee shops,” he said. 

A person speaks
Pasquale Presa, owner of Pasquale's Neighborhood Pizzaria gives suggestions at a downtown Rochester task force work session on Feb. 27 in Rochester, Minn.
Ken Klotzbach for MPR News

Empty storefronts

But Forsman remains concerned about the empty storefronts that dot the main streets of Rochester. Forsman's rent across all locations has risen 25 percent in the last three years, driven by rising property taxes. 

Start-ups and local businesses feel shut out. And he says that hurts all businesses.

“We have this stretch now where if you're coming from Mayo, you look down and you see a row of empty storefronts. Nothing says to you, 'There's something at the end of that block that's exciting to me,’” he said. 

That empty stretch could affect the success of businesses at the end of the block, he said. 

DMC's Patrick Seeb says new rent accommodations may be necessary to fill those empty spots.

“I think that's an example of how we can think bigger about supporting entrepreneurs, especially entrepreneurs in the retail, dining, and hospitality spaces,” he said.

In coming weeks, he says city leaders will be getting more feedback from the community, recommendations Seeb hopes will kick in fast. 

A person writes on the white board
Moderator Bethany Von Steinbergs takes notes during a downtown Rochester task force work session on Feb. 27 in Rochester, Minn.
Ken Klotzbach for MPR News