The downturn in the economy has impacted all of Santa Monica’s commercial districts but Downtown Santa Monica hasn’t been hit as hard as the City’s more upscale areas.
The Bayside District Corporation (BDC) Director of Marketing, Debbie Lee, told the Mirror Downtown Santa Monica “hasn’t seen a huge decrease in foot traffic” during the recession however, people are spending less per visit. The area’s vacancy rate has not noticeably increased because vacancies have been filled quickly. The Downtown area’s restaurant/retail rate has also remained the same as before.
Rob York, BDC’s Retail Leasing Consultant, explained at the moment “there are very few leases turning over.” There is also more increased interest by large and small tenants in the Downtown area as well as more flexibility being shown by landlords with rents than a year ago. However, “fewer tenants are in an expansion mode than a year ago” especially those on the higher end. He also noted that when “Santa Monica Place (SMP) comes on line it will” cause some of the spaces on the Promenade to reshuffle because some of the tenants that moved out of SMP before its re-model may move back in.”
Lee also mentioned the BCD is also increasing its marketing efforts to bring more business to the Downtown area. These efforts include the “Buy Local Campaign” which emphasizes that buying local makes a difference in out local economy and is a sustainable practice. They are also inviting more businesses to participate in the employer rewards program. This program gives employees who work in Downtown Santa Monica discounts at downtown businesses. They have also seen an increase in the number of downtown employees taking advantage of the program’s benefit.
Other marketing efforts involve promoting the area for tourism and redeveloping the branding for Downtown Santa Monica and the Third Street Promenade to be more tangible and competitive. Lastly, the BCD according to Lee is “working hard to make the upcoming holiday season unique.” She also emphasized the area “still offers a unique experience and that has not changed due to downturn in the economy.”
The Mirror also spoke to Barbara Bryant who is one of the owners of Interactive Café. Her café has not experienced any drop off in business because of their approach of “keeping quality up and prices down.” She also credits the loyalty of her local customers for keeping the café successful during the recession by noting “Santa Monica has a sense of community that’s getting harder and harder to find these days.”
King Seafood owns both iCugini and Ocean Avenue Seafood in Downtown Santa Monica as well as 15 other restaurants. King Seafood’s owner, Jeff King, told the Mirror the bottom fell out of the restaurant industry last September and October but “now things are slowly recovering.” People who can afford to eat out have lowered the amount they are eating out because now the “national and international psyche is to save for a rainy day.” He hasn’t had to close any restaurants but has had “to operate smarter” which has included cutting back on his staff’s hours and not replacing people who have left. He also will not be opening any new restaurants in 2009 but he has expanded into the fabrication and distribution business in order to save money and get a more high quality and varied product.