Making money on Mill Avenue hasn’t been an easy task lately. It started with a citywide smoking ban at bars and restaurants. Then construction on every major downtown road.
More closures to build the Metro light-rail line. Plus the perennial gripe about a lack of parking. And several merchants saw sales plummet when the city snatched illegal signs off Mill a few weeks ago.
Now merchants face another threat: 1.3 million square feet of new stores, restaurants and bars will open this summer at Tempe Marketplace. The behemoth competitor is less than two miles from Mill and boasts 6,000 free parking spaces.
Downtown merchants dreaded Marketplace when it was first proposed, as some still had memories of similarly sized Arizona Mills mall siphoning away customers when it opened a decade ago.
But surprisingly, most merchants now say they don’t fear Marketplace. Some even think it could boost downtown.
“That’s going to help bring people to the area,” said Jay Wisniewski, who owns Cafe Boa. “I think it’s going to help people discover Mill Avenue.”
He’s seen 50 percent annual growth for two years despite all the downtown disruptions.
His sales growth holds up even on a monthly basis, and even during the dreaded summer months when most Arizona State University students are gone, so he can’t imagine the new center will hurt him.
Wisniewski is one of Mill’s more optimistic merchants. At the other end is Karli Jacobson, moving her Urban Angels clothing boutique from Mill to Marketplace.
She recalled how friends refused to meet her at restaurants or bars on Mill, giving up after being stuck in traffic or not finding a parking spot.
“They’ve called me and said they’re leaving because they drove around for 35 minutes and couldn’t find a space,” Jacobson said.
She figures people will check out Marketplace’s new restaurants, bars and stores and will favor them over downtown because of the parking.
Jacobson has heard friends scoff at her moving to a shopping center anchored by Target and other chains. But she’s seen computer animations of Marketplace’s entertainment district and said it’s “cooler” than anybody could expect.
Marketplace owner Vestar has done more to help her business than the city has helped downtown, she said.
“It’s hard to understand why they would take your sign away yet they’re not doing anything about the homeless guy who’s yelling at my customers as they walk in the door,” Jacobson said.
The latest gripe among downtown merchants was the loss of A-frame signs. The city had ignored the illegal signs for years and many business owners relied on them to attract customers, especially merchants tucked into spots with poor street-front visibility.
When Tempe started cracking down on the signs, sales immediately dropped 20 percent at Yucatecan Imports, owner Clay Poulson said.
He figures that’s worse than the threat posed by Marketplace. He notes how chains like the Gap and McDonald’s failed on Mill because it’s easier for customers to go to other locations with adequate parking.
Poulson said he’s stayed open because he travels the world to buy merchandise and stocks his shelves with items from two dozen countries. Stores like his that offer items Target doesn’t carry will stay healthy, he said.
“To survive down here you have to be special and you have to build your own clientele,” he said. “Any business that comes down here and says they’re going to live off ASU, they’re going to fail.”
The group representing downtown merchants expects Marketplace will hurt downtown at least initially while shoppers check it out. But the downtown area is healthier than when Arizona Mills opened, said Pam Goronkin, executive director of Downtown Tempe Community.
“People that like authentic places will circle back,” Goronkin said.
The biggest threats to downtown merchants have already hit, said Cody Cooper of Mill Avenue Jewelers. The parking shortage and years of construction drove many owners to other locations or out of business, he said.
Cooper isn’t sure what Marketplace will do to downtown but figures better times are ahead. He hopes residents of the thousands of proposed downtown condos will be more loyal and help businesses.
For now, his concern is the road construction and constant closures.
“When all of the construction is done, people will be just fine,” Cooper said. “But people will have to be able to get in and out of this area without being tortured.”