It’s getting tougher to find a good meal in Collegetown these days.
When students returned to Cornell this August, they found that yet another two longstanding Collegetown eateries — Smoothie Hut and The Greek House — had shut their doors for good. These latest vacancies join the veritable laundry list of Collegetown closings in recent years.
In light of the steady increase in Cornell’s class size and subsequent Collegetown housing boom over the past decade, the growing number of vacant storefronts is an alarming trend. So what is the driving force behind the closings? In a word, rent.
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Collegetown commercial properties rent for the highest prices in Tompkins County, according to David Gelinas, 4th Ward Representative on the Ithaca City Council. At the heart of Collegetown — the corner of Dryden Street and College Avenue, the asking price is “around $50 per square foot per month,” said a source who wished not to be named. An eatery on Dryden Street pays about $4,000 per month, and other businesses in the area face similarly prohibitive costs.
“It may not be the only reason, but the high rents definitely have something to do with it,” said Matt Austin, owner of Pita Pit. The restaurant reopened under new ownership last February in a space leased by the Ithaca Renting Company. He also acknowledged that the recent expansion of Cornell Dining has “made it more difficult for Collegetown owners to compete.”
Matt Miller ’04, a former Smoothie Hut manager and current Miyake employee, agreed.
“Smoothie Hut couldn’t keep up with the price of rent. When I came to Ithaca in 2000, Collegetown was pretty full — there were no vacancies. Ever since then, places have been emptying out.”
The owners of the Smoothie Hut in downtown Ithaca could not be reached for comment.
“The Greek House closed because the owners were tired of operating it — they didn’t go out of business,” said a source who asked not to be named, although he noted “business had been slower in recent years.”
Gelinas explained that “the problems stem from an over-inflated market. Landlords think they can get the rates they are demanding, but they are just too high to afford.”
The majority of vacant spaces in Collegetown are owned by the Ithaca Renting Company. Sources who wished to remain nameless at two other major Collegetown real estate companies, Student Agencies and Avramis Rentals, said that all of their own available commercial space was occupied.
In a written statement, Ithaca Renting Company owner Jason Fane denied the claim that high rents were to blame and provided alternative theories on the closings of Smoothie Hut and The Greek House.
“The Greek House had been our tenant since 1982, during which time the family who owned the business developed other interests and decided to retire from the restaurant business when their lease ended,” he stated, adding that “the owner of Smoothie Hut recently elected to pursue her advanced degree instead of operating a restaurant.”
Fane also stated that in Collegetown, “rents have not increased in the last decade, so tenants are getting a great bargain.”
Another Collegetown landlord with both commercial and residential properties, who asked not to be named, cited the Ithaca Renting Company’s steep prices as the principle reason for its lack of tenants. The source added that “Mr. Fane is a very wealthy man who can afford to let his properties stay empty until he can get his asking price.”
In a follow-up email regarding his previous statement concerning rent, Mr. Fane stated that rent had nothing to do with the closings of businesses at any of his properties in recent years, including The Chariot, the Bank of America, Smoothie Hut or The Greek House. He added, “Many businesses that fail are just not well run and are so inefficient that they would lose money at zero rent.”
He added that tenants who cited rent as the reason they went out of business “usually did not pay any rent at all for the last few months and tried to screw the landlord.”
Regardless of the root of the problem, students are becoming frustrated by Collegetown’s diminishing dining options.
“If landlords keep up their high rental prices, it is going to get harder to find good, cheap food in Collegetown because restaurants will have to charge more. That’s unfortunate because college kids generally don’t have a lot of money to spend,” said Collegetown resident Lauren Friedman ’07.
Fortunately, the Ithaca City Council is looking to turn Collegetown’s rental slump around. The Collegetown Vision Task Force, chaired by Gelinas, is aiming to make Collegetown into a Business Improvement District, or BID. This means that merchants in a particular area agree to impose a “self-tax” in order to provide additional services that are not covered by the city.
“A BID would dramatically help the problem,” said Gelinas.
“We would be able to hire a lobbyist to help bring in new tenants and fill the vacant spots.” BIDs have proven successful in sections of New York City, and a BID could potentially bring new businesses into Collegetown as well.
In order for a BID to be implemented in Collegetown, at least 50 percent of the business owners in the area would have to give their approval. A vote for a similar plan in Collegetown failed about 10 years ago, but Gelinas is optimistic about gaining approval for a Collegetown BID in the near future.
Moreover, negotiations are underway to open up new eateries in Collegetown’s newest buildings, said one source who wished not to be named. These include a Starbucks at 401 College Ave. and a burrito restaurant at 319 College Ave., where construction is underway.
While questions still linger in regard to the steep costs and high turnover rates of Collegetown rentals, students will have to make do with the limited selection of dining and shopping choices available to them.