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Downtown St. Petersburg: from hot to tepid?

By Cristina Silva, Times Staff Writer
In print: Sunday, October 5, 2008

Restaurants like Z Grille and Fortunato’s were busy on Thursday after the Rays victory. But one businessman says: “This is a very, very brutal business atmosphere to try to operate in.”
	[LARA CERRI | Times]

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ADVERTISEMENT [Times files] Paris Hilton and Benji Madden visited Push Ultra Lounge in May. Related Links Mouth of Tampa Bay: Dining blog

ST. PETERSBURG

Only six months ago, downtown's buzz knew no limits.

Trendy restaurants mushroomed on every street, pop darlings Paris Hilton and Chris Brown were photographed at downtown's posh nightclubs, and Saturday nights saw hordes of people spilling out from the area's bars and cafes.

But as the economy continues to spiral down, downtown's claim as Tampa Bay's hottest neighborhood is becoming increasingly vulnerable.

At least five restaurants closed or reduced their hours last month. Banbu, one of the area's three major nightclubs, closed in May. Another, Push, is undergoing its second makeover in seven months. BayWalk is in the midst of its latest upheaval, and downtown's office vacancy rate is at 12 percent, a six-year high.

"St. Petersburg is a great city. It has everything you can ask for," said Jack Bodziak, president of Jannus Landing Courtyard. "But I can tell you that this is a very, very brutal business atmosphere to try to operate in. Times are tough."

City officials, however, remain bullish and point to a wave of development on the horizon: the Salvador Dali Museum, St. Petersburg College's cultural center, and the expanding University of South Florida St. Petersburg campus.

Developers also have plans for thousands of new condominium units within the next five years, and fast-food joints are thriving. Burrito Boarder just opened on Third Street N, and Five Guys Burgers and Fries is slated to open on First Avenue N within the year.

Recent failures, city officials say, only illustrate the area's growing viability.

"With competition, some businesses will succeed and some won't," said Mayor Rick Baker. "I still think St. Petersburg right now on the west coast of Florida is considered the place to be."

But even some of downtown's most popular attractions and nightspots have begun to feel the pressures of the stagnant economy.

BayWalk, recently sold to entrepreneur Fred Bullard, is 25 percent vacant. Muvico threatened to pull out if things didn't improve.

At Jannus Landing, "shows that used to sell out, do 1,500 people, are doing 1,000," Bodziak said.

The 600 block of Central Avenue was vacated in 2006 to make way for a retail and condo project that has fallen into limbo.

Restaurants Table and Mesa Lounge, the Kitchen, De Santo Latin American Bistro and Push Ultra Lounge, and Hammerhead Island Grill closed their kitchens in September despite loyal followings. Bella Brava, another trendy spot, temporarily stopped serving lunch. All are expected to relaunch in some form after some reshuffling, but the temporary loss set tremors through the restaurant community.

Dan Smith, owner of Pacific Wave Restaurant on Second Street S, said sales remain steady, but he recently lowered his prices and delayed plans to expand with lunch and late-night menus because of other restaurant closings.

"We decided it was too big of a risk," he said. "All you have to do is drive down Central Avenue and see there are more boarded-up places than there are open."

While Push works on its new restaurant, the nightclub has started serving burgers, tacos and other finger food, nothing higher than $4, to its late-night revelers. A four-day grand opening is planned Oct. 15 through 19.

"You have to continue to change," said Matt Donahue, a manager and co-owner.

Some business owners protest that the city isn't doing enough to attract people to the area. Although Baker has overseen the birth of local events like the Grand Prix, Miss Florida Pageant and St. Petersburg Bowl, critics point to the city's paltry marketing budget.

St. Petersburg spent nearly $75,000 on advertising the entire city this year. Tampa, meanwhile, spent $150,000 just to promote Ybor City.

To survive, businesses are banding together.

Earlier this year, former nightclub manager Jon LaBudde and two friends created the Downtown Bloc, a private marketing group to promote the area. They sell $10 membership cards in exchange for discounts at downtown restaurants and attractions. They host parties, like the monthly Little Black Dress event, and send out weekly e-mails highlighting area events.

"We are not West Hollywood. We are not L.A. We are just little St. Petersburg. We cannot grow in leaps and bounds," said LaBudde, who now owns the Reno Beach Surf Shop on Fourth Street N. "Downtown St. Pete is a destination place. ... We just have to grow gradually."

Cristina Silva can be reached at (727) 893-8846 or csilva@sptimes.com.