And the fund has helped replace a beloved Old North Dayton bakery with a new shop that will continue its legacy and try to expand upon it.
The First Floor Fund, which launched last fall, already has awarded more than $2 million in financing to more than a dozen Dayton projects.
Beneficiaries say the low-interest and forgivable loans are extremely helpful at a time of high borrowing costs and expensive construction costs.
“The interest rate was really great — much lower than with a traditional bank, especially because interest rates are so high right now,” said Casey Nickole, the owner of SHAG Studios, which is a new project under development in southern Dayton.
The city of Dayton gave CityWide $7 million of its $138 million in federal COVID relief funds to create the First Floor Fund. The city’s spending plan for the money is called the Dayton Recovery Plan.
The fund offers low-interest loans worth between $50,000 and $300,000. The loan amounts can be no greater than half of total project costs.
The fund also offers forgivable loans worth up to $50,000 — or one-fifth of total project costs (whichever amount is less).
CityWide’s targeted loan interest rates are 2% and 4%, and 13 projects have been approved for financing.
This includes two restaurants in the Dayton Arcade; one restaurant in the Wright Dunbar area; four lounges and bars; three salons; one carryout business in St. Anne’s Hill; a specialty retail store; and a bakery.
“Small businesses play a major role in the vibrancy of our city,” said Shane Wilken, senior business development officer with CityWide. “They help create more appealing, walkable places and spur more developments and investments.”
SHAG Studios, at 1126 S. Main St., will offer 11,000 square feet of salon, personal care and mixed-retail services, such as hair, nail and massage treatments.
The property is a former medical office building, located across the street from the old Montgomery County Fairgrounds.
The upper level will have 15 rentable, luxury private suites that will be individually leased to small business owners, Nickole said. The upstairs area also will have an open-floor setup, with a dozen salon stations.
The lower level will be a micro mini-mall, said Nickole, who envisions DIY makers, artists and small retailers setting up shop.
“We want to be the location where independent creatives come to grow their business surrounded by like-minded professionals,” she said.
The market in the lower level will have office, studio and small retail spaces that offer short-term and very affordable leases, she said.
Miniature pop-up retail shops have become increasingly popular in cities across the globe.
“I think that short-term leases and small spaces are a really great way to help people see if their business has legs before committing to something too big,” she said.
Nickole received $292,500 in financing from the First Floor Fund; $50,000 was a forgivable loan.
The primary loan has a fixed rate of 3%, while the secondary, forgivable loan has a 1% fixed rate, CityWide said.
Nickole said she thinks the interest rate on a traditional bank loan could have been 9% or 10%.
“The difference between 3% and 10% is a massive amount of money — like hundreds of dollars a month,” she said.
Nickole said she definitely was going to do some kind of project in Dayton since she decided to move back here from Seattle during COVID.
But she said it’s highly unlikely she would have moved forward with this project if not for financing from the First Floor Fund.
She said she would have had to charge tenants much higher rents if she had larger loan payments.
Nickole, who owns and operates a salon company in Seattle called BANG, said SHAG should open in mid-2023, and she wants to have tenants by August.
Reserve on Third
Erin Parrott and her fiancé, Edward Joiner, also received loans from the First Floor Fund to help renovate a storefront space at 452 E. Third St. in the Cannery Lofts building, which is the former home of Therapy Café, a nightclub.
Parrott is turning the space into the Reserve on Third, a 25-and-older lounge that she says will offer an “elevated” experience at reasonable prices.
Parrott said they don’t know yet what days of the week the Reserve will be open, but it will have a live DJ on the weekends, Fridays will be Latin night and Sundays will offer brunch.
The Reserve on Third will have a full bar and will sell dishes that are easy-to-eat and do not require people to sit down to dine, Parrott said.
The establishment will have reservable sections that offer bottle service.
Reserve on Third will open this summer, possibly by the end of July, Parrott said.
Parrott said the storefront space needed a lot of work.
She said two first floor loans are helping cover construction and other project costs to transform the property into something special and “the space Dayton deserves.”
“There really are no words — we’re really grateful,” she said. “We’ve already poured more than six figures into this so far, and that’s just (to get to) the current state it’s in.”
Parrott said one of the great things about the First Floor Fund is that loans can be used for working capital.
She said many financial institutions will not issue loans to cover everyday operations.
CityWide says loans can be used for permanent working capital, building renovations, tenant improvements and equipment, furniture and fixture purchases.
Baker Benji’s, a full-service bake shop, had its grand opening on Saturday. The owner purchased the Evans Bakery and opened up his new shop in the bakery’s longtime location at 700 Troy St.
Baker Benji’s was the first business that has received First Floor Fund to open its doors.
The project would not have happened without loans from the fund, said Benjamin “Benji” Stuckey, the owner.
“Honestly, without their funding, this dream of mine would not have come true,” he said.