The 2019 Turning Point For Our Small Business Economy

Owners of Fleur de Lys in Los Alamos
Owner of Mille in Santa Fe

These past two weeks, three local businesses in Los Alamos announced that they would soon close their doors. While the pandemic has been hard on local businesses, some of these businesses are closing due to the challenges they have faced with the commercial real estate market of Los Alamos. Many of us have also been following the saga of Unquarked, this local food/wine business that once tried to take over the space formerly occupied by Blue Window Bistro in the Mari Mac Village Shopping Center, was red tagged by the County, and ultimately was never allowed to open. This series of bad news is not a coincidence but instead the result of years of inaction and bad decisions from the local government.

Looking back at the last 4 years that we have been in business with Fleur de Lys, there was one major turning point that changed the game for our small business community: the transfer of 6 parcels of land on Trinity Drive and 20th Street (across from the pond) to TNJLA as part of a Local Economic Development Act (LEDA) grant.

In October 2019, Los Alamos County Council voted in favor of giving 3 acres of land appraised at $1.8M to an out-of-town corporation to build a hotel, conference center, and café in exchange of the promise of job creation and the operation of a conference center. From the start, the smart house was to be demolished. In the most recent site plan, the café has disappeared. Finally, we all know who the conference center is really built for. Before this decision was made, there was a meeting on August 2, 2019 at the County where a large number of small business owners and citizens voiced their disapproval of this LEDA agreement. The line was out the door and the meeting was endless because of all the public comments.

But as it is often the case at the County, public comments were ignored and the agreement was approved shortly thereafter. The conference center and hotel will bring customers to local restaurant and retail businesses. It will be used for weddings and other private events. It will bring jobs. It will bring X number of dollars in GRT. It will be another commercial success! It is true, the local experts and various studies they used said so. More seriously, it is speculation dressed in good intentions at best.

A reasonable alternative would have been to build the conference center next to the golf course restaurant (which already has an event room by the way) and to sell individual parcels to local business owners to establish a long-term presence for their business in Los Alamos. Fleur de Lys would have certainly been a candidate for one of the parcels and would not close its doors at the end of December this year had this happened. Other businesses had previously tried to purchase a parcel from the County there. Instead, of owning their space, having a fixed mortgage, and an incentive to stay in Los Alamos, most business owners in this town have to rent a space, often with a yearly rent increase and some stringent restrictions on how the space can be used or how business can be conducted. The price of a commercial building is directly related to lease rate and cap rate. The higher the rent, the higher the value of the building, regardless of the condition of the building.

In the end, we end up with leasing rates in some parts of downtown Los Alamos that are higher than on Water Street, a block away from the Plaza in Santa Fe, but without the same foot traffic. The lack of diversity in land ownership has not been resolved during the four years we were in business. How many restaurants own their space in Los Alamos? How many restaurants would like to own their space in Los Alamos? How many vacant commercial spaces are currently in Los Alamos? Why do they stay vacant for so long? Is the local government enforcing code on vacant and poorly maintained commercial properties? The local government and institutions have failed to improve the state of the commercial real market in this town. Good intentions are just not enough to make it work. In the end, the citizens of this town will judge the local government on actual results. Walking on Central Avenue on a weekend day is a great visual report card! It seems that to bridge the gap between the lack of action from the local government and a vibrant downtown area, our community needs to privately pull together and give itself the legal and financial means to regain control of this situation.

Marcel Remillieux and Stephanie Pasareanu

Owners of Fleur de Lys in Los Alamos

Owners of Mille in Santa Fe