When Carolyn and Leo Stellwag opened Elements Alternative Gifts in 2004, they expected the first year of sales to be a little slow. But, as second year sales showed a decline, they knew there was a problem.
"I feel like we've done everything the right way," Carolyn Stellwag said. "We had a solid business plan, we have a great lawyer and accountant. We have an awesome Web site, which is way ahead of others."
With slow business and high rent, the Stellwags closed the shop that sold candles, incense, stones and other novelty items. For the same reasons, three other businesses in the Village have closed since January 2005. Businesses are not the only things changing in the Village.
In 2001, property owners, Ball State University administrators and Muncie representatives developed a plan to dramatically modify the Village. These changes will not only affect property and business owners but students and campus visitors as well.
THE PLAN
The University-Village Area Development Plan would add more space for new businesses, as well as more university classrooms and offices. It would also add more than 1,700 parking spaces in two garages and five parking lots.
This plan redevelops the area south of Riverside Avenue to Jackson Street and east of McKinley Avenue to Dicks Street. The plan separates the area into four parts - a university area, a business district, a residential neighborhood and Jackson Street.
Though this plan is not on a set timeline, changes have already begun, said Jerry Wise, president of Network Property Services and one of the property owners who helped devise the plan.
The Music Instruction Building and the McKinley Avenue Parking Garage are both part of the university's expansion area outlined in the plan, but the other three parts have not begun as quickly.
Marta Moody, executive director of the Delaware-Muncie Metropolitan Plan Commission, said lack of money is main reason for the slow renovation of the Village.
The business area has more improvements to make than the city and the university, and it has fewer resources to financially support the project, she said.
Wise said he hopes to start renovations this year on University Square, the building that houses Dill Street Bar and Grill, The Bird, BoRics Haircare, T.J.'s Greatburgers, The Giant Locker Room and Wizards Keep.
"The plan is to renovate, and renovate probably means to tear down the University Square as we know it," he said.
Wise and George Branam, an adjunct professor at Ball State and co-owner of the building, plan to tear it down and build a more architecturally modern property.
"It's too depth-y," he said. "The people that were in the back, in the depth-y part of the building, have moved over across the street."
Landmark Florist and Travel Dimensions moved to their current locations, 1618 W. University Ave. and 1614 W. University Ave. respectively, in 2003 for more street exposure, Wise said.
RENT
However, renovations will not be cheap. Rent for tenants in the new building will be more than it is now to help cover the cost of the new building, Wise said.
Myles Ogea, owner of the The Bird, said he plans to stay in the renovated building despite the rent increase. He said the effect of higher rent on his customers is a concern, but he does not yet know the extent of the effect.
Mark Sturgis, sales, leasing and development, tenant and buyer representative at ADM Commercial Real Estate, said the rent in the area costs between $8 and $12 per square foot. Rent for the property that Romo's Pizza recently vacated is on the market for $9 per square foot, or about $3,300 per month in rent alone.
These high rent prices, combined with the little amount of money students have to spend, leave small businesses trying to pay rent that costs more than they can afford. This forces businesses to close, Jeff Hornsby, professor of management, said.
Stellwag said this financial difficulty led Elements Alternative Gifts to close.
"If we could make enough to pay our bills and for me to make a minimum salary, we'd stay open," Stellwag said.
But the property value determines the rent, Sturgis said.
Eric Kelly, acting chairman of the Department of Urban Planning, said property owners could set rent as a percentage of the businesses' sales.
Joe Mumpower, owner of the building with the Chug and Ultra Image Tanning and O'Hairs Downstairs, suggested a similar plan.
"If you charge too much rent, and get greedy, you're going to lose businesses," Mumpower said. "If the owners of some of those buildings would charge a percentage of the income the business makes, then they would have less vacancies."
Mumpower said renovating would push rent up too much for his tenants.
"It's the property owners that made the rent so high that the little guy can't make the rent," he said. "If the money was there, I'd raise the rent and do some fixin' up."
Wise said the property is too expensive to lower rent. The money for renovations is coming from Network Property Services, not the rent money he receives from tenants, he said.
"I make money out in other cities and other states," he said. "We dump it back here in the Village. Why? Because we're Muncie people, we're Muncie-ites, and I like the Village."
'MICRO-DOWNTOWN'
Village-like areas in almost every college town experience the same problems, Hornsby said. Businesses do not prepare for the school-year cycle where students are gone for four weeks of high-business retail time in the winter and for three months in the summer, he said.
"That's why you don't see chains opening in the Village," Hornsby said. "If you're a chain, you have (to pay) much more because of the costs of the franchise."
Wise said more stable, bigger chains do not want to come to the Village because the numbers do not show it as a profitable area.
"Students don't patronize the Village," he said. "They will drive and waste gas money to go out to Wal-Mart to save 50 cents."
Wise expects the Village to be comprised mostly of mom-and-pop stores because the location is not profitable enough for bigger chains.
Moody, of the city planning board, has a more positive outlook. She said the smaller businesses are what make the Village unique.
"When we were doing that comprehensive plan, one thing that popped up was for the uniqueness of the Village area," she said. "It's a micro-downtown."
STUDENTS
While Ball State students enjoy the variety of unique shops the Village offers, they want to see more businesses come to the area.
Sophomore Abra Bailey suggested bringing in businesses that cater to students under 21 years old, such as an ice cream shop. Freshman Jason Clark said he would like to see more specialty shops such as the Little Havana Tobacco Cabana.
Sophomore Kevin Royse, a sports administration major, transferred to Ball State from Indiana University for Fall Semester. While IU's Village has more events and activities for the students to do, Ball State's Village has a good variety, he said.
"It seems like it's a lot smaller, more laid back town," he said. "Everything's open later. The hot dog man and Greeks - they cater to all of our drunken needs. That's really nice."
Wise said he tried talking to students about businesses they would like to see in the Village, but students do not spend their money there.
"I wish I could tell you differently, but I've seen it too many years," he said. "I've sat down with students and asked them and they say 'blah blah blah' and we bring it and the business goes out of business ... The businesses can't make it because the students don't patronize it.
"So what can we put here? Well, it's things for Muncie, not students."
However, Hornsby said the Village is built for the students.
"If they target it for a community that's here 12 months a year, then obviously you're going to run out the businesses that cater to the students," he said. "I don't know if you can have both."
NEW BUSINESSES
Despite the high rent and low customer traffic, new businesses have expressed interest in moving into some of the vacant lots in the Village.
The Pita Pit, which was supposed to open in the beginning of December, has postponed its grand opening to March 1, Lucas Smelzer, owner of the incoming business, said.
"We ran into a couple little pitfalls with the city with a couple codes," he said. "We're still coming to the Village. We're very very excited about doing it."
With the concept of late hours, which will be 11 a.m. to 3 a.m. Monday to Wednesday and 11 a.m. to 4 a.m. Thursday to Sunday, and delivery options that the Pita Pit will offer, Smelzer said he is not worried about opening in the Village.
Other restaurants, such as a bagel shop and ice cream shop, have approached business owners about leasing property in the area.
Ogea, who also owns the MT Cup and Motini's, said he likes the traditional buildings that he owns and he does not plan to change them in the same way Wise does.
"I love older buildings," Ogea said. "I'd rather take something old and adapt it."
He is working on a new business, at 505 N. Dill St., set to open before St. Patrick's Day. He would not say what the new business was.
Ogea said he is always looking for younger people with fresh ideas to help bring businesses to the area.
"My goal is to just keep the Village vibrant," he said.
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