Reviving Lake Street: Nonprofit community groups spearheading recovery

For Allison Sharkey, the traumatic events following the death of George Floyd were immediate and personal. As the executive director of the Lake Street Council (LSC), the nonprofit organization representing Lake Street businesses, Sharkey had promoted a decades-long effort to revitalize the aging south Minneapolis commercial corridor. Now, as large swaths of Lake Street were going up in flames, Sharkey learned that her own office at Lake and Chicago had been destroyed during the civil unrest sweeping the Twin Cities.

“We did lose our office, but luckily we had already been working remotely, so the loss of the office didn’t really slow down our response,” Sharkey recalled. “There was no time to mourn our loss. We had to get to work immediately because there was so much that needed to get done.”

Part of a community network focused on Lake Street recovery, Sharkey and her team at LSC began contacting area businesses to assess the extent of the damage along the corridor. As demands on her small staff escalated, Sharkey realized that she needed to quickly expand her group’s organizational capacity. “We brought on two outreach workers, one Somali and the other Spanish speaking, to help make sure that every business in the corridor needing help knew where to find it,” she said. “Overnight, our annual budget ballooned from a $500,000 to $12 million.”

The budget increase was due in large part to a new grant program created by LSC to assist area businesses with their most pressing financial needs. Known as the “We Love Lake Street Fund,” the new program provided a way for Sharkey’s group to pool the contributions that came pouring into the council as news about damage on Lake Street began to spread worldwide.

“Initially, we designated about $3 million for early disaster relief to help business make repairs, purchase inventory and equipment and re-open,” Sharkey explained. “Once the applications started coming in and we saw the scope of the damage and how little insurance would cover, we increased the initial emergency grant allocation to nearly $6 million. The maximum grant was $25,000, and while that was sufficient to get many reopened, others had hundreds of thousands in damage that hasn’t been covered by other sources.”

Soon, the council recognized that it had to take on features of a foundation in order to appropriately manage a recovery fund, now topping $12 million. “We needed to ensure that the businesses least connected to sources of support (like banks, investors, and government programs) had access to help, so we had to balance the need for moving funds out the door as quickly as possible with the equally important need for ensuring fair access and a transparent process,” Sharkey said.

Julie Ingebretsen, an LSC board member and a long-time Lake Street business owner, has watched LSC transform itself over the last year to deal with the increased demands placed on the organization. “Lake Street Council had served our business community for many years with a dedicated and talented staff of four,” Ingebretsen noted. “Then 2020 happened. Helping us deal with the pandemic was a challenge well met. But the social unrest after George Floyd’s murder took things to a level we could never have imagined,” Ingebretsen said. “All of a sudden, we had an $12 million fund to oversee. Overnight the council had to convert itself from a business support organization to a grant-making foundation.”

While the Lake Street Council continues to assist with recovery efforts throughout the Lake Street corridor, other nonprofit groups are focusing their work on key Lake Street intersections. Redesign Inc., based in Seward, has taken on the task of preserving and rehabbing the historic Coliseum Building that has anchored the 27^th and Lake intersection since 1917. Redesign is purchasing the 100-year-old building from an out-of-state owner who had intended to demolish the vacant building and sell off the land to the highest bidder.

“The owner maintained that the building itself was worthless, and that property’s only value was land on which it stood,” said Redesign’s Taylor Smrikarova. “For us, the building did have value as a community asset, so we agreed to their asking price of $2 million. We were able to get in touch the demolition contractor, who told us that the building had good bones; even though the interior was badly damaged during the civil unrest, he saw no reason why the building had to come down.”

Redesign was able to arrange financing for the Coliseum acquisition through a loan from Twin Cities Local Initiative Support Corporation (LISC), a nonprofit financier that invests in affordable housing and commercial development in targeted neighborhoods. LISC brought together a group of banks, foundations and public agencies to establish a Community Asset Transition (CAT) fund to support projects like the Coliseum. CAT’s intent is to help community-based organizations gain control of key properties along damaged corridors, according to LISC Executive Director Peter McLaughlin. “We had memories of what happened in the wake of the Great Recession of 2008-09 when outside equity and capital came in from the coast and started buying up troubled properties,” McLaughlin told the Star Tribune’s Neal St. Anthony. “We didn’t want to see that happen on Lake Street. We wanted to keep local ownership.”

While Redesign was able to purchase the Coliseum with the help of CAT funds, it will need to fundraise to cover the cost of rehabbing the building. “We will do whatever we can to make sure the building does not stand vacant any longer than necessary. In the short term, we will be using public art to deliver the message that a new day is coming for the Coliseum,” Smrikarova said.

A mile and a half west of the Coliseum Building, St. Paul-based Neighborhood Development Center has used $1.6 million in CAT funds to purchase a vacant site at Lake and Chicago that had been occupied by a small commercial building destroyed during the 2020 civil unrest. NDC, which manages the Midtown Global Market adjacent to the Chicago Avenue site, plans to hold the property until it completes a neighborhood planning process to determine the future use for the site.

Farther down the Lake Street corridor, at Nicollet Avenue, Minneapolis-based Project for Pride in Living (PPL) is partnering with Wells Fargo Bank to develop the site of a Wells office that burned down in the days after the death of George Floyd. With construction expected to begin in 2022, PPL hopes to develop affordable housing in a mixed-use building at the site that will include a new Wells Fargo branch on the first floor.

“How we go about developing the site is as important as what we build there,” noted Mike LaFave, a PPL vice president. “We know that we needed a robust engagement process with the surrounding community to make sure that the project produced tangible benefits for the people who live there.” LaFave said. He explained that PPL is partnering with the nonprofit Cultural Wellness Center in an effort to get input from area residents who don’t often attend formal evening meetings.

Nonprofit development helps ensure that Lake Street recovery continues to be community-driven, said Elena Gaarder with the Metropolitan Consortium of Community Developers. “As the process of reimagining and rebuilding Lake Street continues, efforts must be grounded in the values and vision of the community,” Gaarder maintained. “Without community-driven development, we not only risk the loss of local and Black, Indigenous and People of Color (BIPOC) ownership, but we perpetuate the very systems that fueled the civil uprising. Tapping into the rich cultural assets present along the corridor will lead to the long-term growth and vibrancy of the south side.”