[Noozhawk’s note: Part of a series called Reimagine: Santa Barbara, a Noozhawk special report produced in partnership with Shared Mission Santa Barbara and KEYT News. Over the next several weeks, the series will trace the founding and evolution of downtown Santa Barbara, dive into the challenges we’re confronting today, explore the exciting opportunities in front of us, and take a look at what’s happening with downtowns in other communities. Throughout the series, we’ll be asking you to help us identify priorities and form a vision for State Street’s future.]
You can’t walk a block on State Street it seems without encountering a vacant storefront.
The condition of State Street retail is the worst it has been in more than a decade. For years, Santa Barbara decision-makers struggled with seemingly larger issues — affordable housing, traffic congestion and water supply, while State Street has languished to the point of apparent neglect.
It’s the driving force behind the city’s mayoral and City Council campaigns, with all of the candidates talking about ways to rescue State Street.
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Commercial property owner Ray Mahboob knows the problem well. He has several buildings in the 400 block of State Street, which house the 99 Cents Only Store and Wolf’s Head, a clothing store and barbershop.
Mahboob has been one of the driving forces behind shining up State Street. With several multimillion-dollar investments, he has a financial interest in steering a State Street turnaround. He maintains that the Funk Zone has flourished at the expense of State Street.
“There’s a lack of trust of government from landlords,” he told Noozhawk.
Mahboob, a 44-year-old Goleta native, sees it all. Homeless people steal shopping carts from the 99 Cents Only Store, at 424 State St., and then push them blocks away. Chronic panhandlers hassle patrons. In some cases, homeless vagrants defecate or urinate in public.
It’s not the State Street he remembers growing up. Now married with two children, he doesn’t bring his daughters downtown to watch a movie or shop because he doesn’t believe it’s safe for them.
The homeless on State Street, Mahboob said, hurt retail businesses.
Cristian Sagastume, owner of Wolf’s Head at 432 State St., said Santa Barbara has been asleep at the wheel as he has watched pedestrian traffic flounder in the past three years. He says big-box retailers are leaving and there’s no plan to replace them.
“We need more mom-and-pop shop stores, not big brands that are going to close down in 10 years,” he said.
Sagastume said the normal tourism the city used to have on State Street isn’t there anymore.
“You don’t see a lot of people with shopping bags walking on State Street,” he said. “It’s been more difficult just in the past four months.”
Some of the problem is out of Santa Barbara’s control.
Amazon has decimated the retail industry, putting major retailers out of business and devastating shopping malls. Macy’s, Sears, Radio Shack and Kmart have all announced massive layoffs and store closures in the last 18 months.
Sports Authority, Borders, Payless ShoeSource and many others have gone out of business, victims to how consumers shop for merchandise these days.
Santa Barbara has lost Macy’s downtown, and the Saks OFF 5TH plans to vacate in March.
Millennials, who grew up with instant gratification at their fingertips in the form of ubiquitous electronic gadgets and devices, aren’t shopping at malls like previous generations, and Santa Barbara is feeling the pain.
“The retail landscape is changing on a global basis due to Amazon and the changing tastes of the American consumer,” said Michael Martz, a partner and commercial real estate broker for Hayes Commercial Group.
“Younger people are consuming less material things like clothes and housewares, and (craving) more experiences like food, drinks and entertainment.”
The City of Santa Barbara is trying to address the problems. In August, the City Council adopted an expedited building permit process to speed up approvals for businesses on State Street.
It created a dedicated city phone line for people with questions about State Street-area commercial tenant space. Two planning staff members will guide downtown business owners and commercial real estate brokers through the discretionary review processes.
The so-called Accelerate pilot program projects will also receive priority placement on design review board agendas. The pilot program covers a six-month period and runs along State Street between Cabrillo Boulevard and Sola Street.
“There are more vacancies now than traditionally in the past and that’s cause for some concern,” City Administrator Paul Casey acknowledged.
Santa Barbara is making other changes, by installing new way-finding signage and creating a Police Department volunteer program and State Street Ambassador program to have more city personnel walking downtown.
Casey said the city also is looking at more housing options on State Street, in an effort to infuse the energy of full-time residents into the downtown area.
The downtown retail situation, he said, is experiencing change.
“A number of the vacancies are in transition, new leases are being negotiated, building plans developed, construction (is) underway,” Casey said. “I don’t think it’s a new normal, but more of a market cycle and adjustment.”
Martz said more housing is needed downtown and the city needs to relax parking requirements for developers.
More housing will help revive retail, he said. He also suggested that the large Macy’s building be divided, with retail on the first floor and housing and offices on the upper floors.
“We need more housing downtown,” Martz said. “The future of shared cars, driverless cars, electric bikes is going to dramatically change the need for parking in our society. Cities need to be forward-thinking and start to change the way they look at parking requirements and adapt to this new reality.
“Lack of parking is a big roadblock to most properties’ ability to add housing elements downtown.”
Dave Davis, Santa Barbara’s former community development director and a man well-regarded in planning circles, says it’s time for the city to make some dramatic changes in how it manages downtown.
“Brick and mortar retailing for pedestrian shopper goods is undergoing a fundamental change driven by new disruptive technologies and structural economic forces,” he explained.
“Online retailing and streaming movies and videos, the economic effects on consumer spending by the Great Recession, the future for autonomous vehicles and delivery all contribute to a new paradigm for the future for downtowns such as ours.”
Davis said Santa Barbara is also experiencing a migration of people and interest to the Funk Zone, in the blocks immediately east of State Street between the freeway and the waterfront.
He said the loss of Macy’s in Paseo Nuevo opens the door to completely reimagine what downtown can become.
“We need to start over, re-envisioning what’s needed most in that location to make Paseo Nuevo a vital link to the future of the ‘new downtown,’ including tearing it down for a central public gathering spot vis-à-vis what San Diego is doing with Horton Plaza,” Davis said.
“Their open area shopping mall was created about the same time as Paseo Nuevo.”
Experience-oriented shops and unique products not available online might offer the clearest path toward State Street revitalization.
Davis said city officials should see the retail disruption as an opportunity, and not something to mope about.
“The course of the future of downtown will be affected by large forces outside of local control, but as a community Santa Barbara has always risen to the challenge,” he said.
“Downtown is the historic, social and economic heart of our community. We can look back and try to hang on to a past that is changing beneath our feet or come together as this community always has in the past and boldly reach for the future. I strongly believe we need to seize the opportunity and remake downtown for local citizens and visitors alike.”
— Noozhawk staff writer Joshua Molina can be reached at jmolina@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.