While driving through town, a motorist might note dozens of vacant commercial rental properties from Uptown through West Sedona.
Some are located in prime locations right along State Route 89A, Sedona’s main thoroughfare, such as a former bank building on the northwest corner at Rodeo Road and a former vegetarian restaurant at Dry Creek Road that has been occupied by three restaurants in the last six years.
Others are smaller commercial spaces tucked into side streets or shopping plazas.
Of more than 60 vacant commercial properties listed for lease in West Sedona, sizes range from 155-square-foot units in Leenhouts Plaza to the 3,000-square-foot space in the basement of Buena Vista plaza.
Some longtime businesses, including a liquor store and an auto repair business, both right along State Route 89A, opted to move to locations outside Sedona due to high rents and rental increases.
Few properties with storefronts on State Route 89A in Uptown are vacant, but there are several just off the main road, such as the Uptown Mall off Jordan Road and Mesquite Avenue, in Apple Tree Square and the old Sedona Public Library on Jordan Road.
A former bank directly adjacent to the Sedona Chamber of Commerce Visitor Center on Forest Road was most recently an art gallery but it is now vacant.
Mike Blevins owns two retail shops in Uptown. He said many businesses in Sedona, especially retail stores, have been able to pay their rents, but been unable to spend extra to replenish the inventory.
“As a tourist town, we’re at the tip of the spear,” Blevins said. “A retail shop lives on discretionary spending, so if people feel more optimistic, they may open up their wallets. If they get scared by something they hear on the news, they won’t. You know, tourism is a bellwether.”
One of his stores is surrounded on three sides by spaces that have been vacant for several months. All three spaces are now in the process of being filled.
“People are curious by nature. When there are empty spaces around you, it prompts the question, ‘How’s the local economy?’” he said.
“They want to know, they want to be reassured, and I honestly believe I’m optimistic that things are getting better. But it’s hard to say that with a bunch of empty spaces around you. It’s a self-fulfilling prophecy.
“My feeling is that things are getting better, and our books show they are, little by little,” he said.
While some Sedona spaces have been vacant for years, others lost their tenants due to residual fallout from the world financial crisis.
When the nationwide housing bubble burst in 2007, fewer people were in the market for homes, especially in Sedona, reducing the number of occupied real estate, brokerage and realty offices.
Many of these smaller spaces between Soldier Pass Road and Coffee Pot Drive have been filled since the economy began to stabilize in 2009, but fewer are real estate related.
In the city’s core, one space is vacant in the busy Old Marketplace.
However, right across Soldier Pass Road, there are seven units listed in La Posada Plaza.
At the city’s center in the Sedona Village, aka the Bashas’ shopping center, there are four units available.
Between the two shopping centers on the opposite side of the street, four spaces are vacant in Red Cliffs Plaza.
On the other hand, Tlaquepaque is one complex in town that has worked with its tenants and been able to keep it at 100 percent occupancy.
“We’re cognizant of overhead,” said Wendy Lippman, Tlaquepaque’s general manager and resident partner. “We lowered rents in 2009. At that point we had [Arizona Department of Transportation] construction nightmares on [State Route] 179.”
She said the world financial crisis, which had begun to affect Sedona by 2009, was also a factor. Tlaquepaque lowered rents 10 percent. While there is a built-in annual increase, there has been no across-the-board rental increases and levels are now on par with 2005 rental rates, Lippman said.
Lippman said there’s a difference to being on property and being in the community, as opposed to property owners who may live outside Sedona in other states or even other counties. Property owners and managers who live in or at least work in Sedona have a better feel for the needs of local businesses than absentee landlords, she said.