Hmong, Somali and Latino malls in Twin Cities devastated by economic effects of pandemic

Xue Lor has always relied on foot traffic to bring business to his electronics repair shop, Lor Imports, in Hmong Village in St. Paul.

Yet that slowed when nearby food vendors closed during the state-ordered shutdown. Even after businesses in the village started to reopen, Lor saw the clothing shop across from him struggle. The Hmong International Freedom Festival was canceled amid COVID-19 fears and elaborate dresses for the occasion went unsold.

The owner posted a "for sale" sign. Lor wondered if he'd have to follow suit.

"I am thinking if the rest of the year isn't going so well, I may have to sell too because it's very, very hard," said Lor. The virus is unpredictable, he added, and "I don't have the resources to weather anything major. The worst of the shutdown is over, but people aren't coming back."

Shopkeepers in the Twin Cities' Hmong, Somali and Latino malls are trying to rebound after the pandemic wiped out several months of sales. Some are reducing hours, negotiating rent deferrals and applying for government aid. Even as customers are returning, more elders who once frequented the malls for services in their native language are staying home or spending less time out to protect their health.

And retailers are trying to cope with losing some of their busiest days of the year after not just the cancellation of the Hmong festival, which usually attracts shoppers from around the Midwest, but also the passing of Eid al-Fitr during the shutdown. The Muslim holiday typically draws huge crowds to the Somali malls to buy clothes and gifts, and women pay to have henna artists apply decorative dye in elaborate patterns over their hands and feet.

The state Department of Employment and Economic Development (DEED) is sorting through applications for $2.5 million in grants for operators of cultural malls, much of which could go toward forgiving rent for tenants who received no income during the months they were forced to close under Gov. Tim Walz's shutdown order.

Walz, Lt. Gov. Peggy Flanagan and state leaders recently visited the Village Market, a Somali mall in Minneapolis, to highlight support for cultural malls. They addressed reporters near a shop that sold coffee and sambusas, or fried pastries, where Ahmed Abdirahman lamented from behind the counter that it's "way too slow" and many customers only come on weekends.

The Village Market and other cultural malls "are symbolic as community centers for us," said state Rep. Hodan Hassan, DFL-Minneapolis. "This is where I shop, this is where I buy my food, this is where my neighbors and my relatives hang out. So for me, this is not just a mall, this is a ... space that belongs to the community."

Mall operators hurt by COVID-19 can request up to $250,000 in grants from the state, and Basim Sabri said he is seeking the maximum for his properties Karmel Mall and Plaza Mexico — south Minneapolis markets that host hundreds of refugee and immigrant-owned shops serving the Somali and Mexican American communities, respectively.

Sabri said he's already waived that much in rent alone for tenants at Plaza Mexico, a mall that faced $3 million in damage from looting and vandalism during the riots and has only partly reopened. The company is still trying to replace broken windows and doors. A few tenants don't want to come back. Meanwhile, he said, Lake Street — where Plaza Mexico sits — is seeing less traffic than usual.

Karmel Mall has reopened, and Sabri said he's working to help tenants stay, with some making little or no payments for the shutdown months.

"People are shopping and trying to buy stuff, but ... so far it's not back to the way it was," said Sabri, who wants the government to waive property taxes this year for real estate owners in the neighborhood.

On Saturday afternoon, people jostled through Karmel Mall. But some shopkeepers said the complex was not as busy as it once was, and that customers are more likely to go to the restaurants and barbershops than clothing stores.

Sabrina Seyf used to dress brides for four to five weddings a week in her boutique, Sabrina's Bridal, where elaborate gowns from India and Dubai lined the walls.

"It was ongoing, nonstop business," said Seyf, who received a Small Business Administration (SBA) loan. "Once COVID started in March, everything shut down and there were no weddings. We had zero income coming in from the store and it was really hard."

These days, Seyf's customers are postponing weddings or having smaller ceremonies. She used to sell Somali brides up to three dresses for different stages of the celebration; now some just plan to wear one in a less elaborate event. Family members are less able to travel for weddings, especially elders. And she's faced delays shipping apparel to international clients.

Now she doesn't have customers try on dresses, and makes clients wait outside to observe social distancing. Some don't want to wait and walk off. Her family has another store downstairs that does henna, and missed out on big business during Eid in May.

"It looks busy to you," business owner Aden Ibrahim said of the Saturday scene. "But it used to be way more crowded."

Ibrahim has cut back hours at his store AMI Electronics Inc. People used to come to Karmel Mall from Faribault, Wilmar and Rochester, he said, and now "everyone wants to be in their house. ... When they show up, they come late and leave early."

He had hoped for help from the Hennepin County Small Business Relief Fund, but the program rejected his application because he did not have at least one other employee — Ibrahim instead had several workers who received pay as independent contractors.

At Hmong Village in St. Paul, business is down 30% at Phalen Family Pharmacy. Co-owner Cheng Seng Lo laid off a part-time cashier and scaled back pharmacy hours. Sometimes an hour passes without anyone coming in.

"It's been a struggle," he said.

Lo said he opened the pharmacy here nearly a decade ago because he saw a need for better service for the Hmong community. At other pharmacies he worked at, Lo saw "patients that can't read or write English, they can't really speak the language, and when they have a question and they're trying to call through, they can't navigate the phone system to even ask their question."

Electronics repair shop owner Lor also built a business serving Hmong-speaking customers.

"With the language barriers, that's a point of trust for us in the community," said Lor. "They know that we're here locally, they know we've been here for years, and word of mouth spreads."

Lor Imports & Custom PC stayed open as an essential business during the shutdown, but had fewer customers as crowds waned at Hmong Village overall during those months. Lor saw the clothing alteration shop down the hall turn into a mask-sewing business. Others did not survive, like the prepaid phone store next door to him. Lor worried about how to make it, recognizing that "I have to feed myself, too, and there's rent here and there's rent at home."

He wasn't selected for the St. Paul Bridge Fund, which gives aid to businesses and families affected by COVID-19, and is waiting to hear from DEED whether he was selected in a lottery to receive a grant from the $62 million Small Business Relief Program.

The agency said that so far it has received 15 "potentially eligible" applications for the program from shops in cultural malls.

In the meantime, Lor hopes more people will walk through his section of Hmong Village.

"I do need the foot traffic," he said.