State Street’s Vacant Storefronts

While some people are excited about at least three new retail clothing stores opening this summer on State Street, it appears many other vacant store fronts may not be filled until later in the year. Don’t look for many more mom-and-pop stores to fill some 15 vacant sites.

State Street, one of the county’s key commercial districts and certainly the most visible to tourists, still hosts some long-time retail vacancies, including the former Left at Albuquerque restaurant site, 700 State Street, which closed two years ago. No potential tenants are in sight. Meanwhile, 734 State Street, formerly Ruby’s Cafe, has been boarded up for about two years.

Some murmurs of filling the former Pep Boys site, 424 State Street, have been circulating, but the plans to put an international food court in it dried up when the economy hit the skids in 2008. In July 2009, the mom-and-pop knick-knack store Retroville, 521 State Street, went belly up and the site has been vacant ever since.

On the bright side, the H&M clothing store, in the former Barnes & Noble spot, 833 State Street, is set to open June 23, with a nearby Marshall’s retail outlet, in the former Borders book store building, expected to follow later in the summer.

One of the three vacated Blue Bee store fronts has been leased by the owner of a shop called Savvy on State, 911 ½ State Street, which is set to open in August. Owner Erica Dahl comes from Boulder, Colorado, where she opened her first store, Savvy on Pearl, in 2007. Pearl Street is Boulder’s answer to State Street.

A couple of months ago, State Street’s 900 block was hit with the sudden closure of three Blue Bee locations and, just prior to that, the Taj Café, which was not surprising. Blue Bee had been around 10 years, but it was usually hard to find anyone in Taj.

“It created a lot of sudden vacancy in a stretch of State Street which was already in transition with the closure of Borders and Barnes & Noble,” said Michael Martz from Hayes Commercial Real Estate. He has been involved in signing up tenants in about 18 State Street store fronts of late. At the moment, the 900 block has more vacancies than any other on State Street with six.

Martz said he and his colleagues have been trying to get the word out to retailers across the West Coast about the spaces that are available. “With national retailers like Apple, Forever 21, and True Religion, the 900 block will have strong brand presence for the foreseeable future,” he said. “Even better to also have local and regional concepts like Savvy, Plum Goods, and The Closet to give the block balance and keep it unique.”

Plum Goods and The Closet are among the dwindling number of State Street shops that are not owned by retail chains. While many long-time South Coast residents mourn the loss of the small fry on State Street, the reality is that even with triple-net leases down 30 percent or more from several years ago, small shop owners still can’t afford the rent.

Some other smaller fries, such as Paper Star, were able to renegotiate their triple nets, which are leases that include rent, utilities, and other services. Some were more than $3 per square foot just four years ago. But still, it’s hard to see much revenue to cover the lease coming out of stationary shops these days.

On the horizon, the REI outdoor gear store is scheduled to open after summer along with a nearby by restaurant near the corner of State and Gutierrez streets. Unfortunately, diagonally across the street, the fomer Esau’s eatery and fingernail shop remain empty after about five years.

Moving toward the La Entrada section of State Street, the former Hotel State Street and adjacent Subway Sandwich Shop are undergoing a slow transformation. The owner has gutted the building and is remodeling it to be called the Statehouse Hotel at 121 State Street. However, it’s taken him much longer than he expected to complete the job. He wants to attract a better restaurant than Subway to the empty site.

Next door, another developer is trying to refurbish what used to be Be-Bop Burgers. Again, another slow process is under way to reuse the existing building for some type of as-yet-to be-seen business. The owner won’t return phone calls.

NAWBO LUNCHEON: “Good Business is a State of Mind” is the topic of a June 22 luncheon presentation by author Byron Katie at Fess Parker’s DoubleTree Resort & Hotel, 633 East Cabrillo Boulevard. The 11:30 a.m. to 1:30 p.m. presentation is co-sponsored by the South Coast chapter of the National Association of Women Business Owners, the Association of Women in Communications, and Santa Barbara Women Lawyers.

Time.com has recognized Katie as one of its top 100 Innovators. For some 20 years, she has been presenting what she calls “The Work,” a method of self-inquiry which has helped business leaders become more connected with themselves, colleagues, and employees. Some 25 years ago, Katie says she experienced a realization that transformed her from being depressed to a communicator who has helped many others. She describes it as “waking up to reality,” accepting that the thoughts inside a person’s head, rather than the world, outside may be preventing someone from living their life to the fullest. “The Work” is designed to allow for an ability to work with more trust, confidence, decisiveness, creativity and compassion, and with a better use of one’s own talents and the talents of others, Katie says.

Luncheon seating is limited and reservations are required for the limited seating available. Cost is $35 for members and $45 non-members. To reserve a seat, see nawbo-sb.com/currentEvents.php.

The South Coast Biz Blog is a round-up of the latest business news in the Santa Barbara area written by Ray Estrada, who has covered business in the region for numerous publications over the past couple decades. See more at independent.com/biz and http://rayestradamediaconsultant.wordpress.com/southcoastbizblog-com/.