Not yet recovered from the April riots, the Comair strike and a sagging economy, downtown Cincinnati retailers are facing yet another crisis.

        The five weeks between Thanksgiving and Christmas can make or break a retailer's year, and the news entering the holiday season is making those merchants nervous. That's because:

Lazarus, as seen through the glass door of Saks Fifth Avenue downtown. (Glenn Hartong photo) | ZOOM |

        • Cincinnati City Council is weighing whether to give Saks Fifth Avenue $6.6 million to dress up its store and squelch talk of exiting downtown.

        • Two longtime downtown retailers, Closson's and Lazarus, could be tempted to pull up stakes, too, if a deal with Saks folds.

        • No prominent stores have moved into downtown following the loss last November of the biggest and best prospect, Nordstrom. The site where that retailer would have located, at Race and Fifth streets, was turned into a parking lot instead.

        In a year that's seen almost every economic, social and political misery possible, downtown has barely made a dent in its effort to become a retail hub.

        And that sends reverberations throughout Greater Cincinnati as more customers are content to shop and eat in the suburbs and come downtown only for sports or cultural events.

        “Downtown retail, by itself, is not a sustainable proposition,” says Paul Darwish, president of Closson's, the boutique furniture store at Fourth and Race streets and a downtown fixture for 135 years.

        “I'm not optimistic. We very much want to stay downtown, but I don't get a good feeling.”

        Most of the bigger retail projects announced downtown are restaurants, such as the new Bella eatery at Sixth and Walnut streets and the coming Jean-Robert at Pigall's, set to open next spring on Fourth Street.

        Overall, vacancy in downtown storefronts was about 6 percent when measured last spring. That is about the same as the same time last year, says David Ginsburg, who handles retail development for the marketing group Downtown Cincinnati Inc.

        While no hard figures are available to document the decline, “I'll tell you anecdotally that this has been a very difficult retail year,” he said.

        That has led downtown leaders to turn their attention away from retail development and focus instead on putting money into new apartments and condominiums.

VOICES

Do you plan to shop downtown this Christmas season?    “I have not shopped downtown in a while. Once I get some extra money, I will be shopping downtown. You need extra money to shop at Saks (Fifth Avenue).    “I would shop downtown more if I didn't have to worry about getting a (parking) ticket. Parking in a suburban mall is more convenient. You don't have to worry about having change for a meter.”    — Carolyn Agee, 47, Bond Hill    “No. Parking is too expensive. It seems too much of a hassle. They need better shops to lure people downtown. The Lazarus doesn't have as good of a selection as the one in Kenwood Towne Centre.”    — Andy Holcomb, 32, Hamilton    “I will shop downtown this year. I work down there, so I shop during my lunch break.”    — Chotsani Fegan, 23, Avondale    “I like going downtown for Christmas. It seems like the right place to go. I use to go down there before all these suburban stores were built. My daughter and I would go down there, do all our Christmas shopping, and come home with bags of gifts. It's nostalgic.”    — Earline Turner, Norwood    “No, I don't plan to shop in downtown Cincinnati this Christmas season. It is inconvenient. I don't know my way around downtown very well. I'm going to shop at Newport on the Levee. It's new, exciting.”    — Laurie Fencl, 26, Mount Washington    “I usually try to avoid shopping downtown. It is kind of a headache. The traffic can be bad. I live in Madeira. It is easier for me to just come here (Kenwood Towne Centre).”    — Chris Oole, 25, Madeira    “I will shop downtown this Christmas. I shop there because of convenience. I work downtown.”    — Kim Trapp, 30, Oakley    “No, I'm not going downtown. It's too far. I live in Loveland.” nbsp;   — Yusuf Bhatia, , Loveland    “Absolutely. I will go down there because of the selection. There are specialty shops there that carry items you can't find in the malls or mass department stores. City leaders shouldn't subsidize stores to make downtown a more attractive place to shop. I'm not going to shop at Saks. Their prices are already higher. Why should they get tax dollars to subsidize their renovations?”    — Becky Wirtjes, 32, Mason

        “If we don't get the population down here, frankly, all the effort and capital in the world won't work,” says Dave Phillips, the retired Arthur Andersen executive who helped start Downtown Cincinnati Inc., the biggest advocacy organization for downtown, in 1994.
       

Downtown retail tough

        The difficulties for downtown shopping are no different in other cities. Cleveland felt the sting last week when Dillard's Inc. announced that it would close its downtown department store there, the last mainline department store in the central business district.

        In Cincinnati, Saks officials have requested $6.6 million from the city to remain downtown for the next 15 years. Only five years ago, City Council approved a $2.1 million incentive package for Saks.

        Saks officials would not comment on the proposed renovation, which would include special “vendor shops” for such labels as Gucci and Chanel.

        Last week, outgoing City Manager John Shirey recommended making the $6.6 million investment. As part of the deal, Saks would agree not to open another store within 30 miles of downtown for at least seven years.

        Mayor Charlie Luken never took a firm position on the issue during his campaign.

        As the decision by Mr. Luken and City Council approaches, retailers throughout downtown are feeling the pain of a subpar year and fearing what might happen during the critical next several weeks.

        First on the the watch list: Closson's. Mr. Darwish calls Saks “absolutely critical” because of the upscale clientele the two stores share. And he hinted that with a lease expiring in 18 months, Closson's could be next to leave downtown. He would not comment on specific locations.

        “Unless there's some sort of comprehensive retail plan, we're not wedded to downtown,” Mr. Darwish says. “We want to stay, but we're looking at other options.”

        Next could be Lazarus, built in 1997 at Fifth and Race streets by hometown company Federated Department Stores Inc. The loss of Saks is one of several triggers in Lazarus' Byzantine lease that would allow it to pull out of its spot west of Fountain Square, but not for several more years.

        Lazarus officials did not return calls seeking comment, but business and civic officials have been buzzing about the possibility for months.

        Several blocks west on Fourth Street, the Silverglade family is within a couple of weeks of opening its downtown market.

        Because there are several hundred apartments in the surrounding blocks, the store will offer home-cooked meals, produce and other products that might cater to younger downtown residents, Craig Silverglade says.

        “I think we'll do well down there, but our situation is a unique one,” he says. “There's a lot of residents down there, but there's just not a lot of what we do.”

"Cautious optimism'

        Across the street from Fountain Square, Susanne Halmi is nervously entering the holiday season at the helm of Tiffany & Co. The three weeks leading up to Christmas are critical to that store's success.

        “I'm still optimistic, but obviously in light of the last several months, it's cautious optimism,” she says. “We think we'll still have customers coming through our doors, but they'll be spending less.”

        Several blocks east on Sixth Street, Tony Vanjohnson is bullish on downtown. He opened Margaritas restaurant in July, and plans to open another one in Tower Place in January. He said the effects of the April riots would be “short-lived.”

        “Downtown has a lot to offer, as long as the city of Cincinnati and the people who make these decisions are backing up small-business people,” he says. “Our business has exceeded our expectations.”

        Also on Sixth Street, Ken Heil has seen sales at his Barleycorn's restaurant and bar fall 10 percent compared to last year, mostly because of the April riots sparked by a police shooting of a 19-year-old man.

        Mr. Heil is still optimistic, and calls downtown “a fun store.”

        “There are certainly enough attractions downtown,” he says. “The Reds play downtown. The Bengals play downtown. The Aronoff Center still brings business downtown. And there's still a ton of people who work downtown.”

Three-point plan

        Downtown businesses have taken one hit after another this year: the Comair strike, the April riots, the slowing economy and the September terrorist attacks.

        “When are the locusts and the flood coming?” asks Rick Greiwe, chief executive officer at Downtown Cincinnati Inc., the downtown marketing group.

        With retail development flagging, city and civic leaders are concentrating more on building apartments and expanding the Dr. Albert B. Sabin Cincinnati Convention Center.

        Stores are now a complement to that strategy, they say:

        • Convention center: Unable to raise more than $300 million for a huge expansion stretching west across Interstate 75, city leaders now have endorsed a smaller expansion that would cost less than two-thirds that amount.

        Conventions bring in “clean money” that doesn't require any additional investment, supporters insist. And more conventions will help prop up downtown hotels, which are suffering with occupancies that are the worst in decades.

        The expansion of the center west to Central Avenue is the top downtown priority of corporate CEOs. But so far, they have been unsuccessful in prying funding guarantees from Hamilton County and the state of Ohio.

        • Residential development: Several new projects will add about 300 apartments and condominiums next year, and the demand is increasing, Mr. Greiwe says.

        Key demographic groups such as young professionals and empty-nesters are peaking, leaving a 10-year window to add more residents to the several thousands that now live downtown, he says.

        “The key is, these are new residents to the city.”

        • Marketing: Downtown Cincinnati Inc. is just one of several groups contemplating a regional campaign to highlight the city's cultural and arts assets.

        The downtown marketing group also is coordinating this year's downtown holiday celebration. It will spend about $300,000, counting several corporate sponsorships.

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