Small Businesses Struggling In Uptown, Other Areas Of County
Friday, September 25, 2009
It's a mixed bag for small businesses in San Diego. Some small businesses are opening up with renewed confidence that the economy will improve, while other longtime businesses are closing down for good. We'll learn how businesses in the Uptown area of San Diego are faring, and compare that to what's happening in other local neighborhoods.
GLORIA PENNER (Host): So we’ve been talking about San Diego’s downtown. You know, the city also has an uptown with well known communities such as Hillcrest, Mission Hills, North Park, established neighborhoods with houses and condos, apartments, and long-time small businesses and restaurants. But change is underway, and Ricky kind of telegraphed this when he mentioned Pernicano’s before. Change is underway and Pernicano’s has been sitting there empty for a quarter of a century. It’s an old-time pizzeria owned by the Pernicano family. People are starting to notice that it’s closed, Leslie. Is Uptown having a hard time these days and that’s the reason Pernicano’s is getting all this attention?
LESLIE WOLF BRANSCOMB (Editor, San Diego Uptown News): It is. And you’re right, Pernicano’s has been closed a long time. But right now, the economic downturn is hitting areas like Hillcrest and Mission Hills particularly hard because there are so many small businesses, restaurants, shops, galleries, things that depend on the populous to go out and spend money, and we’re seeing closures just right and left. We moved into our office in May in Hillcrest because a mortgage company moved out. And since we’ve been there, we’ve seen numerous businesses around us fail and go under. Two restaurants that we reviewed in our newspaper have closed their doors just since the reviews appeared. The Hillcrest Stationers closed, the LaVache restaurant right across the street from us; it just seems like an epidemic. And I do think this is bringing renewed attention to Pernicano’s, which has been closed a long time because people are really saying, you know, this is a spot where new business could go in. Something could be done with this and nobody, to my knowledge, has yet suggested it for a homeless shelter, but there seem to be two schools of thought on that. Some people would like to see it cleaned up and used for additional businesses, new businesses, that can breathe new life into the area. Others would like to see the parking lot used or maybe the whole thing used for a parking lot because that’s a secondary and related problem for the Uptown merchants. Not only a lot of closures, but people – they feel that people don’t come there, they go to shopping malls instead because there’s a consistent problem with lack of parking. So these things are combining to affect the situation there, and you’re right, I’ve seen a lot of anger recently over Pernicano’s. Even though it has been closed for decades, people are – a lot of the business owners are getting together and saying, well, let’s do something with this. And, to date, it’s still sitting there. It belong – it’s his property.
PENNER: Mr. Pernicano’s.
BRANSCOMB: Mr. Pernicano, yeah.
PENNER: He’s still alive.
PENNER: He’s 92.
PENNER: 92-ish. All right, well, let me ask our listeners about that. You heard what Leslie Branscomb had to say about the neighborhood in which she operates, Uptown area, stores closing, little boutiques going out of business, the face of Uptown changing rather remarkably. Are you seeing that in your community? Are you seeing that the businesses that have been there for a while are no longer there and new ones are or are not moving in? And how does that change the atmosphere in your community? Our number is 1-888-895-5727, 895-KPBS. Ricky, even the Mission Valley area where the San Diego Union-Tribune has its building, I mean, that’s changing as well. Am I right? That the top two floors of the San Diego Union-Tribune are no longer going to be Union-Tribune?
RICKY YOUNG (Government Editor, San Diego Union-Tribune): Yes, Gloria. The – As you know, there’ve been cutbacks at the paper. That has created some space and they’re leasing some of it out.
PENNER: Where – What’s going to go in there, do you know?
YOUNG: I wish you wouldn’t put me on the spot like this.
PENNER: Well, that’s why you’re here today.
YOUNG: But I do understand they have a tenant for the top floor.
PENNER: Oh, they do have a tenant, okay. And, John…
YOUNG: But we will get to keep the cafeteria, which is nice.
BRANSCOMB: I heard it was going to be a homeless shelter?
YOUNG: It’s not.
PENNER: John. You know, where you operate out of the – I think you operate out of which area of San Diego?
JOHN WARREN (Editor and Publisher, San Diego Voice & Viewpoint): We in the – on the corner of mid-city in terms of our location in southeastern San Diego.
PENNER: What are you seeing there?
WARREN: Well, you’re seeing a scenario where there have been changes. Businesses have closed, some have gone out of business not because of a loss of business but because of changes in ownership of properties. And there’s still a lot of property owners that think they’re going to be able to get the prices that they used to get and they’re finding out they can’t. Some people don’t need the money so they can afford to have the buildings boarded up and just write them off but we’re finding that landlords are becoming more flexible in terms of wanting to do something with the property. They’re only giving short term leases. They’re backing away from the high rates. You know, in the Gaslamp, property is like $60.00 a square foot, out in the city people might’ve been getting four or five. Some are coming back down to two. Some less than that, depending on where they are. So you’ll see – you’re finding flexibility, depending on who comes with an idea to put a business in a location.
PENNER: And isn’t that what happens in the down economy? Don’t you find maybe that there are opportunities that people might not have had before when a site – when a business moves out, the site becomes available. As with you, a mortgage company moved out and your newspaper moved in.
BRANSCOMB: That’s right. And as they say, when one door closes, another one opens. And for every business that moves out, with the exception of Pernicano’s, inevitably one – another one does come in. So we have seen a lot of businesses go out but it also provides an opportunity for entrepreneurs, people who might’ve lost their jobs in some other line of work who are now looking to start up their own business as a safety – a fallback, and we have also seen – just as we’ve seen restaurants go, we’ve seen new ones come. And I think that the new businesses that start up are taking a big chance but they’re enjoying favorable rents in many cases, as you mentioned, and also just an opportunity to start over. So where there’s transition, it’s not necessarily a bad thing.
PENNER: Our number is 1-888-895-5727, 895-KPBS. You have a minute or two, if you want to get in on the conversation. So let’s hear from Jeff in Mission Valley. Hi, Jeff. You’re on with the editors.
JEFF (Caller, Mission Valley): Hi. How are you all doing today.
PENNER: Fine. Please go ahead.
JEFF: The question is, or the statement is, with Pernicano’s specifically, I do a lot of shopping in that area and, from my perspective, the history of the building is such that we’d like, of course, to see something happen to it, but at the same time to the suggestion to change the codes or zoning regulations for somebody that’s currently meeting the rules without violating anything and they’ve kept up on all their taxes and stuff, just seems very heavy-handed to me. And I’ll take whatever comments you have on the – off the air.
PENNER: Okay. Leslie?
BRANSCOMB: Well, yeah, that is an issue with the Pernicano’s. It kind of smacks of imminent domain although nobody has said those words out loud. It’s a very touchy issue. Does the government have the right to force you out of a property that you legally own? A lot of people would like to see something done with that business and you’re right, Mr. Pernicano does keep it up to code although just barely. There are missing light fixtures with exposed wires, there are weeds in cracks, and in the sidewalk, and other things. But it does open a very, very touchy subject about whether the government can and should be allowed to do that, you know.
PENNER: Well, the city has taken many properties by imminent domain for an improvement project. Why not this one, Ricky?
YOUNG: Well, first of all, I don’t think it’s in a redevelopment zone. But, yeah, Todd Gloria has suggested trying to find some way the city can push change there. You know, I think that location is not necessarily a good one for us to see what’s going on with the economy. The Corvette Diner moved out in Hillcrest, immediately replaced by an Urban Outfitters, which is a pretty healthy store. And so, you know, maybe something needs to be done there but I think Leslie’s right, it’d be very controversial in terms of a kind of taking issue.
PENNER: I’m wondering, when I think about the Corvette Diner, I think about, you know, young families going, taking their kids there and having all the excitement of the way that the wait staff is dressed and the decorations. Could this also be more than the economy that’s changing? Could it be the demographics of the community that would also shift the businesses? Leslie.
BRANSCOMB: You know, that’s a very good question. I was at the Corvette Diner their last night there in Hillcrest, and it was always a fun place with lots of children but I’ve got to say the Uptown area is not – There are certainly families there with young children but it’s predominantly populated by folks who are either young and aren’t yet raising families or perhaps retired or singles, professionals. It’s not so much like the suburbs where you would have so many families with young children. Of course there are families with children more toward – when you get into Normal Heights and North Park area. But I’m – I wonder if the demographics there were not supporting it as well as they could have. Although I have to say, it was crowded every time I ever went.
YOUNG: When I’ve taken the kids to some restaurants in Hillcrest, there’s no booster seats, no high chairs, so that’s not necessarily the demographics. I would like to put in a plug. Speaking of the economy, USA Today had a story recently about how people are starting up franchises or businesses, not unlike the Uptown News. You know, as a response to the economy, there’s more entrepreneurship and a Cici’s Pizza has opened out at 54th and University and I spent a few years in the south where Cici’s was a big deal. It’s a pizza buffet and I’d like to see one of those in Hillcrest because it’s a good family place that it’s reasonable and they have some wild pizzas, like a macaroni and cheese pizza for the kids.
PENNER: Oh, okay, well, this is not a commercial station but you just put in your plug and I hope Cici appreciates it.
YOUNG: Maybe that’ll change Pernicano’s mind to open up the site.
PENNER: You stepped on my tag line, which is I appreciate you and the rest of the editors. Thank you so much, Ricky Young, San Diego Union-Tribune government editor, and John Warren, editor of the San Diego Voice & Viewpoint, and publisher as well, and thank you so much for coming in Leslie Wolf Branscomb. I hope you’ll come back. She is editor of San Diego Uptown News. Again, if you have a comment, you can go to KPBS.org/EditorsRoundtable. Thank you to our listeners and our callers. I’m Gloria Penner and this has been the Editors Roundtable on KPBS.