By Ed Moosbrugger

December 2, 2009 -- Downtown Santa Monica retailers are headed for their second consecutive difficult holiday season to end what has been a very tough year.

Just how difficult it will be remains unclear because there are mixed economic signals.

While there wee more shoppers out during Black Friday weekend this year, they spent less money than last year, according to the National Retail Federation's Black Friday shopping survey, conducted by BIGresearch.

The survey found that 195 million shoppers visited stores and websites over last weekend, up from 172 million last year. But the average spending dropped to $343.31 per person from $372.57 a year ago. Total spending reached an estimated $41.2 billion.

“Shoppers proved this weekend that they were willing to open their wallets for a bargain, heading out to take advantage of great deals on less expensive items like toys, small appliances and winter clothes,” said Tracy Mullin, NRF's president and CEO.

“While retailers are encouraged by the number of Americans who shopped over Black Friday weekend, they know they have their work cut out for them to keep people coming back through Christmas. Shoppers can continue to expect retailers to focus on low prices and bargains through the end of December.”

National sales reports reflect a mixed bag of prospects for Downtown Santa Monica. A strong sales report released by Apple Inc. earlier this year holds promise for its busy store on the Third Street Promenade.

But several apparel chains with stores on the Promenade have suffered sales declines nationally. Although there are exceptions, most retailers have struggled in 2009.

“It's been a very rough year,” said Mark Hennessey, owner of Hennessey & Ingalls art and architecture bookstore on Wilshire Boulevard near the Promenade. “It's not getting worse, but it has leveled off at a pretty unacceptable rate.”

With stiff competition from Amazon.com, Hennessey said, “I think independent bookstores may have to reevaluate bricks and mortar.”

Guerboian, who more than doubled the size of his store this year, said retailing “is turning around slowly.”

For Naren Patel, owner of Shiva Imports on the Promenade, it has been the worst he has seen in 15 years on the Promenade.

“I don't see a great Christmas this year,” he said. To stimulate sales, he will keep prices lower than normal.

Bucking the trend of weak sales, Ron Baron, owner of the Candy Baron, said sales have sweetened a bit at his store on Santa Monica Boulevard near the Promenade.

“I'm very pleased,” said Baron, who hopes to move back onto the Promenade. “I think it will be a pretty good Christmas for us.”

Indeed, candy seems to be one of the few businesses doing well in a weak economy.
“Candy and food spending may be one bright spot this year” for the holiday season, said the National Retail Federation.

The decline in tourism is one reason Downtown retailers have had a difficult year.

Through the first eight months of 2009, the hotel occupancy rate in Santa Monica dropped 8.6 percent from a year earlier to 77.3 percent, according to PKF

Consulting. Although bad, Santa Monica suffered the smallest drop among submarkets of Los Angeles County surveyed by PKF.

Santa Monica hotels paid a stiff price to try to boost occupancy. The average daily room rate in Santa Monica fell 15.8 percent.

Occupancy was down even in the peak summer months, but not as much as earlier in the year. The occupancy rate fell 2.1 percent from a year earlier in July to 87.3 percent, and dropped 3 percent in August to 89.8 percent. The average room rate was down 19.3 percent in July and 18.8 percent in August.