The Future of Horizon Books
By Beth Milligan | April 2, 2020
The planned closing of Horizon Books has been put on indefinite hold as owners Amy Reynolds and Vic Herman team up with the Traverse City Downtown Development Authority (DDA) and Rotary to find new tenants for the building who will help it continue as a vibrant “third place” for downtown. Reynolds says she’ll stay operational during the search to find the right owner or owners who will preserve the building as an anchor for Front Street.
DDA board members will hold a virtual meeting Friday at 10am to approve accepting a $21,000 grant from Rotary to fund a study on potential activities and uses for the Horizon Books building. The DDA will kick in an additional $5,000 for the study, hiring Illinois Facilities Fund (IFF) – a mission-driven lender and real estate consultant that specializes in development solutions in the Midwest – to lead the effort.
“We believe this study will help bring stakeholders together to identify what works, what’s needed, and how to make the Horizon Books building viable for its new owner and the community,” DDA CEO Jean Derenzy wrote in a memo to board members. “The study will provide an assessment and blueprint for the development of the building that will inform a potential purchaser.”
As part of the study, IFF will evaluate the operating costs of the Horizon Books building and its architectural and site plans, assess potential uses for the property, and identify different tenant and development scenarios. The consulting group will meet with DDA and Horizon Books staff and other key stakeholders to gather input and ideas, and meet with potential tenants interested in co-locating in the building. IFF will “prepare a project development budget for each development scenario,” along with estimated construction costs and operating pro formas, according to the proposal. The timing of completing the study will be contingent on the pandemic; initial kickoff meetings can be held virtually, though IFF will eventually need to do physical walkthroughs of Horizon Books to complete its work.
The special attention paid to the property owes to the historic nature of the bookstore – which has been operational downtown since 1961 – and the current building’s massive 22,000 square-foot size. The building's square footage and operating costs could make it difficult for one tenant to single-handedly occupy the space long-term sustainably. When Reynolds and Herman announced in January they planned to end Horizon Books’ nearly six-decade run, mounting financial pressures were a key factor in that decision. Reynolds told The Ticker the couple had essentially been floating the bookstore as property landlords, charging below-market rent to the business to keep it sustainable. “We haven’t really had income from the business other than we’ve collected rent,” she said at the time. “It’s not a business model (that’s transferable)…you’d have to triple or quadruple the rent.”
While there are potential major retailers or developers who could take on such a costly project, both the store’s owners and the DDA are reluctant to see the building converted into, say, luxury condos. Derenzy says creative solutions could exist that could include a residential component – such as units on the upper floor – while maintaining a public component on the lower levels. She believes a mix of tenants would be the most sustainable model and says she’d love to see a “family-friendly retail” element that would draw visitors to Front Street. “Those pieces are important for a year-round downtown,” Derenzy says.
Reynolds has her heart set on finding a community-focused tenant who would preserve the property as a “third space” – a central gathering spot for residents outside of their homes and workplaces. Third places are “often associated with parks, cafes, coffee houses, and bookstores,” according to Derenzy. “They are a location where people exchange ideas, have a good time, interact with others, and build relationships. They are also a fundamental element to any successful downtown.” Rotary’s grant is contingent on a public/third space element being included in the building’s redevelopment plans; if that does not occur, the future owner would be responsible for repaying the study’s costs to both Rotary and the DDA.
Open daily from early morning to late evening over the last several decades, Horizon Books has hosted concerts, readings, book clubs, signing events, poetry slams, coffee meet-and-greets with politicians, fashion shows, and numerous other community events. Reynolds says that when she announced the store’s closing in January, the “community outpouring” that followed convinced the couple to put on the brakes and undertake a thorough search for the next owner. “We’re holding out for that kind of community involvement and spirit for the building,” she says. “This is important to us.” Horizon Books will remain operational during the tenant search, Reynolds says; though physically closed temporarily due to the state's “Stay Home Stay Safe” order, the store is still processing online and phone transactions through the pandemic and will reopen once the order has been lifted.
Derenzy says she’s grateful for the couple’s willingness to work with the DDA to find the best use for the Horizon Books building for the “next generation” of downtown visitors. She says Reynolds and Herman are looking to "leave a positive, long-lasting legacy" to the community. “It's not just a building that's being sold, but one that has a heartbeat to it,” Derenzy says.Comment