Manassas will inject $200,000 into a small business accelerator in the heart of its downtown.
The center will be a co-work space for start-up companies looking for office and conference space, mailbox services, and for entrepreneurs attend community events designed to educate small business owners and spur economic growth in the city, said Manassas Economic Development Director Patrick Small.
The business accelerator will be located inside the Hynson Building at the corner of Main and Center streets. The building most recently Fiducial, a company that specialized in business payroll, tax, and accounting services.
The small business accelerator will be located in the bottom floor of the building, with offices for Whitlock Wealth Management and ECU Communications will be located on the top floor. Both independent firms formed an LLC to purchase the building for $1.3 million earlier this year.
“It took a lot of hard work on a lot of people’s parts to come up with a plan solid enough to go to City Council,” said Small. “These conversations have been ongoing for four years.”
The $200,000 grant from the City will be paid to the buildings’ owners once they receive an occupancy permit for space from the city, following a proper build out. The money comes from the city’s economic development reserve fund, with funds gained from land sales like the city’s decision to sell the Downtown Post Office building in 2006, a sale that netted city coffers $657,000, according to Small.
If the accelerator closes within 12 months of opening, the city will recover 66 percent, or $132,000. The city and the private owners will cut their losses wipe their hands of the deal if the center is not profitable within three years.
It will take at least 36 to 48 months before the business becomes profitable, said Small. In the meantime, the private owners, with an investment of at least $650,000 in the building, must hire staff to run the accelerator and pay to keep the lights on.
“I think it’s great that the city is going to have a say in what happens in the premier building in its downtown,” said Gayle Whitlock, a spokeswoman for the controlling LLC owners group.
The accelerator plans to hold educational events while offering two paid membership levels, one for novice entrepreneurs who need additional guidance, and more experienced business owners said Small. It’s not clear when the new center will open for business.
Before the City Council’s vote to fund the $200,000 grant, the City’s Economic Development Authority privately discussed financing the grant with its cash. The idea never gained traction, and the EDA Board of Directors at its June 21 meeting, following a closed session that lasted over an hour, decided to take no action on the funding request.
