In hard times, area is growing

Paul Clinton

So far this year, business headlines have blared dire news of

store closures from retailers struggling with the economic downturn.

Not so here, an area that is arguably in growth mode with a string of

new shopping centers set to open this year.

Local observers attribute the area’s trend-bucking to its affluent

lifestyle and relative plentitude of high-salary jobs.

“In general, I haven’t heard of any widespread store closings,”

said Ed Fawcett, the president of the Costa Mesa Chamber of Commerce.

“There’s a lot of buying power in Newport-Mesa. This area is well

heeled and not hurting in terms of purchase power.”

On Jan. 14, discounter Kmart Corp. announced that it would close

326 “under-performing stores” across the country. In California, 19

stores will be shuttered, but Costa Mesa’s branch, at 2200 Harbor

Blvd., was spared. Upon closer inspection, it becomes clear why. It

was among the city’s top 25 sales tax generators during the second

quarter of 2002, the most recent data available.

Later in the month, luxury toy retailer FAO Inc. said it would

close about 80 of its FAO Schwartz and Zainy Brainy stores. The

company closed out its FAO Schwartz store in South Coast Plaza in

December of 2001. Both companies have filed for Chapter 11

bankruptcy.

On Jan. 21, Wherehouse Entertainment Inc. said it would close 120

laggards, leaving it with 250 stores across the country. The company,

which operates two stores in Costa Mesa, has not finalized the

closure list, a spokeswoman for the company said. It is still unclear

whether the Costa Mesa stores would be closed.

Rather than glum news of closures around town, Newport-Mesa has

welcomed several new shopping centers this year, and others are on

the way for this year.

Shopping centers are usually developed without much worry about

the short-term economic situation, said Richard Luehrs, the president

of the Newport Beach Chamber of Commerce.

“These are long-term investments that will go through many ups and

downs in the economic cycle,” Luehrs said.

In May, the Irvine Co. cut the ribbon on Newport Coast Shopping

Center. In October, the company opened Crystal Cove Promenade. Both

centers have an eclectic offering of specialty stores, including

Trader Joe’s, Williams Sonoma, Pacific Whey cafe and Z Pizza.

A third Irvine Co. center, the Bluffs, will open this spring. The

Bluffs is at MacArthur Boulevard and the Corona del Mar Freeway.

“Our centers continue to fare well, in spite of the economic

uncertainty, because they’re positioned well,” Irvine Co. spokeswoman

Jennifer Heiger said. “Many of our centers have a unique mix of

one-of-a-kind retailers.”

Costa Mesa is also expected to see at least one new center this

year. Baycrest Plaza, in Mesa Verde, is expected to be open by April

1. The center, at the northwest corner of Harbor Boulevard and Baker

Street, is across the street from Costa Mesa Square, anchored by

Target, which opened in December 2000.

The future of the nearby Mesa Verde Center is still cloudy. A

Kohl’s Department Store set for the location stepped into a thicket

of snakes in August when a local group came out to support the

popular bowling alley Kona Lanes, which would need to be demolished.

Newport-Mesa, overall, may only see a 2% to 3% growth rate in the

first half of the year and 3% to 4% growth in the second half of the

year, but observers still say it will be the least hurt.

“People have jobs and, in many instances, high-paying jobs,”

Luehrs said. “There’s more job stability.”

* PAUL CLINTON covers the environment, business and politics. He

may be reached at (949) 764-4330 or by e-mail at

[email protected].