Downtown At The Crossroads -- Is The Largest Shopping District In The Seattle Area Dying, Or Is It On The Verge Of Being Reborn?

Monday in the Times: What happened to Pine Street?

-- Downtown's 7.6 million square feet of retail space is more than that of the eight regional malls from Everett to Federal Way combined. -- Downtown provides about 36 percent of Seattle's jobs - more than one job in 10 in the four-county (King-Pierce-Snohomish-Kitsap) region. -- The Columbia Center has more jobs - 3,000 - than some suburbs have people. -- Taxes on downtown property constitute nearly one-fifth of the city real-estate tax collections, and that same property generates about 15 percent of the city's sales taxes. -- About five percent of the city's general-fund budget - $20.5 million, about the same as the budget for Seattle Center - comes soley from fees and fines from parking meters, two-thirds of which are downtown. ---------------------------------------

Near the shops and snack bars in the Columbia Seafirst Center, Mary and Jeffrey Meyers settle into a table with their sack lunches and soft drinks.

The Meyerses live in Lynnwood. Every workday, they drive to downtown Seattle, park in the garage under the Seafirst Fifth Avenue Plaza, take an elevator to work. Most days at lunch, they usually walk through a tunnel under Fifth Avenue to the Columbia Center, eat, go back through the tunnel to work, go back to the garage, go home.

Mary goes outside to smoke. Jeff rarely goes outside or even bothers to bring a coat to work.

There's no need to. The 76-story Columbia Center is as self-sufficient as a spaceship.

You can stroll three climate-controlled floors of shops and restaurants offering everything from submarine sandwiches to bee propolis candy bars to burgers from the building's own Burger King.

You can have your clothes dry-cleaned, your hair cut, your legs waxed.

Usually, the Meyerses shop at Alderwood Mall. Aren't there things they can get downtown that they can't get at the mall?

"Not that I know of," says Mary.

"You can get mugged," says Jeff.

DOWNTOWN STILL DOMINANT

This is the way many of us live and work now. Maybe in the city, but increasingly not of it.

We don't have to descend to the hustle and bustle and increasingly, the hassle, of city streets. We don't have to go downtown the way we used to, before the supermalls and the Kmarts, the Costcos and the Ross Dress for Less and Mervyn's stores, before home-shopping TV channels and computer-shopping networks.

Across the nation, people are shopping less as employers cut jobs, baby boomers age and many consumers discover they already have pretty much what they need, materially. Industry experts warn that the nation has so many stores that half of those around in 1990 won't be here by the end of the decade.

In the midst of this change, downtown Seattle remains an anomaly, one of only a handful of the nation's big-city downtowns to maintain a huge job base and a large, diverse and relatively healthy retail core.

While downtown no longer possesses the singular clout it once did, it still dominates the local economy in terms of tax revenues, retail space and jobs.

Yet Seattle's downtown is showing signs of stress, and some indications of its direction are troubling.

Buildings that once showcased the city's most elegant stores sit empty, amid spreading emptiness. Streets are busy, but business is slack.

Vacant storefronts and half-empty office buildings loom, and shoppers are being driven away by inconvenient, relatively expensive parking, traffic congestion and the fear of being accosted by strangers or victimized by crime.

Panhandlers who once gravitated toward the seedier sections of First Avenue and Pioneer Square now cadge quarters on Fifth Avenue and nod off in doorways of the city's smartest shops.

Frederick & Nelson and I. Magnin, two major Pine Street retailers, are gone, leaving a hole in the heart of the retail district and in the city's budget. When Frederick's flagship store closed nearly two years ago, sales averaged $70 million a year, or about $5.7 million to the state and $1.2 million to the city in sales tax alone.

Some of downtown's problems reflect changes in the city it anchors.

Seattle's tax base is shrinking as businesses settle in the suburbs. People still are choosing to live in the area, but increasingly, they're living outside the city. Over the last 10 years, the city's share of county population has declined steadily, from 37 percent to 33 percent.

More people - a total of 17,762 - have retail jobs downtown, but the number grew only 6.2 percent between 1988 and 1992, compared with 12 percent in the four-county (King-Pierce-Snohomish-Kitsap) region as a whole.

Perhaps downtown's most intransigent problems are rooted in social issues: crime and grime and population loss to the suburbs; homelessness and panhandling, and offensive behavior that drives away that critical element on which all retail hinges, the shopper.

Let downtown's problems linger too long and downtown is lost for decades, if not forever.

Robert DiNicola, until recently the chairman of The Bon Marche, witnessed the deterioration of downtown Atlanta's retail core in the late 1980s and worries that something similar could happen here. He worked for Rich's department store then and, when its downtown flagship store closed, DiNicola blamed the closure on the city's lack of attention to downtown's troubles.

The store went quickly. In 1986, it underwent a $10 million renovation. Five years later, it was gone.

The complexity and necessary diversity of downtown runs head-on into simple solutions.

Government overreacts to some situations and makes others worse. Merchants resist being told what to do, then demand somebody do something. The city talks about drawing shoppers downtown, then penalizes them with high parking rates and frequent towing.

Urban planners complain there aren't enough people on the streets, then require office buildings to include retail shops that keep people inside.

The problems and possibilities of downtown form, in the end, a fundamental contradiction: It is simultaneously too crowded - with cars and people - and too empty - of shoppers and businesses.

It is, as Yogi Berra once said, so crowded nobody goes there anymore.

EVERYTHING TO EVERYBODY?

Wearing an olive raincoat and carrying an iridescent olive umbrella on rainy days, professional shopper Jan McLaughlin makes her rounds.

Usually, McLaughlin shops for a half-dozen clients at once, picking through silk mousseline blouses and sweater sets, dangling earrings and designer clothes for somebody's Caribbean cruise.

McLaughlin needs a sophisticated selection, and a wide one that isn't found in malls. Nor do malls usually offer the ultra-chic shops, the classic architecture or even the excitement created by the sheer number of people on the streets.

She occasionally shops the malls but dislikes the way sound reverberates, the harsh quality of unnatural light, the air permeated with the smell of roasted nuts.

"It all smells like Buddy Squirrel to me," she says.

While some experts believe downtown can continue to be everything to everybody, others think downtown needs to find a market niche and stick with it.

Since malls tend to cater to the middle of the market, downtowns can create a niche for themselves by offering what malls don't: the unusual and unique, a category encompassing everything from Abercrombie & Fitch to the Pike Place Market.

Downtowns need a strategy, just like Fortune 500 companies, says Richard Bradley, president of the International Downtown Association, based in Washington, D.C.

The strategy doesn't necessarily have to revolve around retail: "The creating of a great and memorable place is not necessarily linked with being able to buy pants," Bradley says dryly.

Some downtowns have re-created themselves, quite successfully, as centers for sports, children's museums or universities. Yet, Bradley acknowledges, such uses generate less tax revenue than strong retail districts, and usually are what cities turn to when retail is gone.

MORE THAN A SHOPPING CENTER

In competition with the mall, downtown suffers from the mall's single-mindedness of purpose.

Malls have one reason for being: selling.

Downtowns are places to live and work and window-shop, to socialize at sidewalk cafes or watch parades. They serve as centers of commerce and government, places to deal with city hall or to do business with bankers, lawyers and architects.

Such diversity can be paralyzing. When it's time to make decisions affecting downtown, forging a consensus is a chore. Everybody wants a seat at the table: city officials, arts and cultural organizations, retailers, churches, libraries, real-estate interests, historical preservationists and, to some degree, anyone who uses downtown.

Filling the Frederick's site is a good example. No matter what has been proposed - moving the library there or something entirely different - it quickly became clear that no single plan met everybody's concerns. (The most likely solution is a proposal to move Nordstrom's flagship store into the building and attract new retail shops to the current Nordstrom building; a decision is expected soon.)

The plight of downtown has been underscored by the exit of Frederick's and I. Magnin.

The closure of Frederick's especially has raised the level of concern. Whatever happens, or doesn't happen to it, may seal downtown's fate.

While a new Nordstrom store would strengthen the retail core considerably, one development does not a downtown make.

It's wrong to expect that project to fully revitalize downtown retail, warns George Rolfe, director of the University of Washington's Center for Community Development and Real Estate. While it may help for five, perhaps 10 years, downtown needs a huge base of tourists and shoppers, not just downtown workers, spending freely, if its retail core is to succeed in the long run.

And downtown needs at least three department stores, says Jim Mance, a leasing agent for The Rouse Co., the developer of Westlake Center, the 60-shop mall.

Downtown has only The Bon and Nordstrom.

"If one left, I think the whole downtown would die," Mance says.

Despite downtown's critical need for shoppers, it seems instead to be catering increasingly to workers instead. A growing percentage of downtown retail jobs are not in traditional outlets selling so-called shopping goods, such as apparel and accessories, but in groceries, convenience stores selling sandwiches, cigarettes and soda pop to downtown workers.

Should the Nordstrom-Frederick's deal fail to gel, it could signal further deterioration downtown, Rolfe says.

Others, such as Seattle retail consultants Dick Outcalt and Pat Johnson, believe downtown is strong enough to continue attracting stores regardless of what happens to the Nordstrom-Frederick's deal.

Sports-shoe giant Nike, for one, has all but announced plans to build a Nike Town on Sixth Avenue and says the Nordstrom-Frederick's deal won't determine its decision.

And Banana Republic is renovating the old Coliseum Theatre for a much-larger downtown store.

Developer Basil Vyzis, building a luxury condominium tower at First Avenue and Virginia Street, insists that downtown retailing will recover and that the present glut of office space reflects only the miscalculations of some developers, not a waning interest in downtown.

"It has nothing to do with the vitality of downtown, it was just people who didn't know what they were doing," he says. "You can't blame downtown Seattle for that."

WEDDED TO THE CAR

In the increasingly bitter, pitched battle for retail sales, one of the most powerful weapons is parking. Shoppers want lots of it, as cheap and close to stores as possible.

Shopping malls and downtowns approach parking from opposite perspectives: for one, it's a science. For another, an accident.

Mall developers revere parking. They ponder its placement and design, brooding endlessly over whether they can squeeze a few more spaces out of a finite parcel of land.

This obsession has led to certain guidelines, such as one specifying that parking lots have fewer spaces than shoppers only 20 hours a year, and another requiring parking spaces be no more than 500 feet from stores.

Happenstance rules downtown parking.

Thus, you have Bellevue Square with 10,000 parking spaces for 18,000 shoppers a day - and parking is free. Counting every spot from the Seattle Center to the Kingdome, downtown has 51,000 spaces and 6,200 parking meters to accommodate some 165,000 workers and untold thousands of shoppers and visitors.

By that measure downtown parking may seem inadequate but on average, more than a quarter of downtown spaces are empty.

Often, parking spaces aren't where they're needed, partly because of city policy that has ranged through the years from neglect to heavy regulation.

One consequence? The Federal Building, built in 1974, is 37 stories high and has 37 parking spaces.

While politicians profess to want more shoppers and visitors downtown, they make the opposite case in front of Peter Miller's bookstore every day.

From the windows of his shop near the Pike Place Market, Miller sees tow trucks gathering just before 3 p.m., when they can tow illegally parked cars away. There are always cars to tow because the signs prohibiting parking are hard to understand.

Cars are towed so often that Miller keeps the phone numbers of the towing company and the cab company taped to his counter to offer the luckless drivers.

Yes, he says, he knows the city makes money by towing cars. But these people are the city's customers, and won't return if that's how they're treated.

"Until that part changes, until you understand that you're trying to make them come, then you have nothing," Miller says.

And still, the cars come. About 380,000 vehicles enter and leave downtown during an average weekday, and most shoppers - 77 percent - come downtown by car.

Which is why, on one hand, the city encourages people to share rides or take the bus and, on the other, considers building a public parking garage in the retail core.

Meanwhile, the city is actively discouraging commuters from driving downtown.

By 1995, the state hopes to cut commuter trips by 15 percent from 1990 levels. To do so, it's pressuring employers to get workers to share rides, telecommute or otherwise refrain from solo commuting.

Such measures should free downtown parking spaces for shoppers,

though critics point out commuters also are shoppers. And they're less likely to shop if they're sharing rides - or not coming downtown at all.

In the short run, downtown workers may bow to the new restrictions, says Bob Dunphy, senior researcher with the Urban Land Institute in Washington, D.C. They'll car-pool or take the bus or pay more to park.

But in the long run, he says, they may feel it's more important to drive to work than to work downtown. So they'll work elsewhere. Eventually, such a situation could force downtown businesses to pay a premium to get workers and, if the premium proves too high, business may leave.

The relocation of jobs to the suburbs has been under way for years, though. Office buildings are under construction or nearly full in Bellevue, for example, but it's a buyer's (and renter's) market for downtown Seattle real estate.

Leased office space in downtown Seattle is a case in point. Generally, it's $3 a square foot cheaper than comparable space in Bellevue.

Blame it on overbuilding in the 1980s, and bank consolidations, as well as business preference for suburbia. So overbuilt is downtown, says a Norman Co. report, that rents will have to rise 50 percent to 100 percent before developers can justify new buildings.

Downtown land prices may have hit bottom. One buyer bought property at Second and Pike for $250 a square foot in 1990, hoping to build a high-rise. He sold it last spring for about $50 a square foot. In another case, a developer paid $400 a square foot for a downtown retail court that brokers estimate is worth $100 a square foot today.

Brand-new buildings, like the AT&T Gateway Tower at 700 Fifth Ave. and Security Pacific Tower at 1301 Fifth Ave., sit nearly half-empty. Some older buildings are almost deserted. And more problems are on the way.

On the horizon is the virtual office, high-tech lingo for linking workers to the office by computer. At its most extreme, the virtual office could mean no need for traditional offices, which would mean no workers downtown.

No matter how many people are downtown during the day, most nights, downtown largely dies after 7 p.m.

If you're on the streets after office workers have gone home, you may be alone. If you go out to dinner, you'll find there are plenty of places to eat but not much of a restaurant district. Seattle's downtown restaurants aren't close enough to form a critical mass.

Nor is there an entertainment district. What nightlife the downtown area has is scattered - a theater here and there, nightclubs in Belltown, in Pioneer Square, or by the freeway near Denny Way, and the symphony, the opera, the Seattle Repertory Theatre at the Seattle Center.

Too few people are around after dark to bother staying open late, says Yves Mizrahi, a Starbucks executive who travels about 100,000 miles a year looking for potential store sites.

In cities like Chicago and Vancouver, he's seen the kind of atmosphere he wishes Seattle had, where day slides into night and the lights come up and the city swings to the energy of people enjoying the romance of the night.

THE NEED FOR DENSITY

Finding what makes cities work, by day or by night, is key. The ferment of downtowns works best when downtown is concentrated, compact, dense, says urban observer Jane Jacobs, whose books on cities have shaped the thinking of urban planners for the last two decades. What works best, she writes in "The Death and Life of Great American Cities," is "a close-grained diversity of uses."

Anything that dilutes that density weakens the heart of the city, and ultimately, the city's ability to function as a social and economic whole. Without it, Jacobs writes, people who ought to get together, fail to; ideas and money that ought to meet, don't; and networks of public life shred.

To encourage this critical diversity, some cities have created departments with an office devoted solely to downtown. In Seattle, those functions are scattered, or nonexistent.

Seattle has no downtown retail plan, no inventory of retail spaces - an important tool to determine what businesses it's missing. Little research exists that is specific to downtown retail - how sales are doing, who its customers are, which leases are expiring on retail space.

When Nike first looked into putting a Nike Town in Seattle, it asked for such information. The city referred it to the Downtown Seattle Association, which referred it to local real-estate brokers, who could only relate bits of information and hearsay.

The city and the downtown association used to compile some information in an annual survey that fell victim to budget cuts a few years back. Not long ago, the mayor's downtown task force suggested that the city spend $100,000 on a retail inventory but the city said it's not needed unless the Nordstrom-Frederick's deal collapses.

While merchants' complaints are part of city life, the din has subsided from the level it hit about a year ago. At that time, Mayor Norm Rice and the City Council, under strong pressure to address downtown problems, announced a number of new measures. They beefed up police patrols and boosted anti-drug activity. They installed new lighting in some areas, raised the wattage in others, passed a tougher anti-loitering ordinance and, this winter, reversed a parking-meter rate increase, bringing rates back to $1 an hour.

Recent statistics show that downtown crime fell 4.6 percent in January and February from a year ago, and arrests for drug activity were up 15 percent, though crime has been up in the immediate area around the vacant Frederick's building.

Merchants have noticed changes, but problems remain. The owners of Jordan, a boutique featuring Japanese designers, say they've noticed daily police patrols on Fifth Avenue, something they never saw before. A transient who slept in their doorway has moved on.

Then again, they've also been robbed for the first time, a couple months ago.

POTENTIAL FOR SEATTLE

Can a traditional downtown with sidewalks open to the wind and rain and anybody who wants to be there still succeed?

Tom Black, an economist with the Urban Land Institute in Washington, D.C., believes it can. In fact, probably the strongest retail sales in the country are not in malls but on public streets: Fifth Avenue in New York, Union Square in San Francisco and north Michigan Avenue in Chicago.

Seattle's downtown has unique attractions like the Pike Place Market and Pioneer Square and a stunning natural setting to draw tourists and others with money to spend.

It has healthy neighborhoods near downtown, ready to supply a steady stream of shoppers.

"I would have to be very bullish on downtown Seattle," says Black. "It's more a matter of figuring out how to do it than whether or not it can be done."

Certainly, more people are moving into the heart of the city and more are expected to come. Under the city's comprehensive plan, one out of every five new households by 2010 will be downtown or in the Seattle Commons - a proposed area of park, homes and businesses between downtown and Lake Union.

Already, the jutting beams of half-finished luxury condominiums and apartments stud Belltown, and finished buildings are filling. The new residents embrace their proximity to the Market, the Kingdome, the Seattle Center, theaters, restaurants and shops.

For many, downtown is also where they work.

Writer John Koval moved to Belltown less than a year ago from a quiet, tree-lined neighborhood on Queen Anne Hill.

Since moving downtown, he's been rising early because he's so eager to begin each day.

He revels in downtown's daily assault on his senses, in its sophisticated and seedy sides.

With equal gusto, he mentions dining at a restaurant with a Michelin-ranked chef and neighborhood sights like the peep-show marquee boasting, "Live Girls! Live Girls!"

In comparison, Queen Anne seems stultifyingly suburban.

"I am stoked on the city," he says.

A BURDEN TO BEAR

In the long run, the nation's policy toward its poorest residents may determine the future of downtowns. America's big cities have become the caretakers of the nation's poor, which has strained their resources. Partly to meet this burden, cities raise taxes on businesses and residents.

If cities continue to bear a disproportionate share of this growing burden, they won't be able to compete with other areas as places to live or work.

"Why should you locate your business in downtown . . . if you're going to have to pay higher taxes to support that population?" says Black. "Why be there? Your shareholders could care less if you're in downtown . . . or the suburbs."

Certainly, in this respect, Seattle is better off than most cities, he says. Still, it is not exempt from this situation, which promises to worsen as population and political balance shift from cities and fewer people feel they have a stake in sharing the cities' burden.

The poor have always been with us, but not quite so obviously.

Lorraine Dooley, who has lived downtown for more than 30 years, has watched the recent influx with concern for those who sleep on the streets - and for the survival of her neighborhood.

From the wide, 11th-floor windows in her elegant apartment near the Paramount Theatre on Pine Street, Dooley sees the angled green glass of Westlake Center's atrium jutting skyward and the stately, wedding-cake Frederick & Nelson building. On her way to work at the Medical-Dental Building, Dooley stops at an alley.

"They aren't here today," she says, surveying the scene with distaste. Before her are a couple of graffiti-covered Dumpsters, empty bottles in brown bags, a pair of jeans, two shoes.

"God knows where the body is," she says, shaking her head.

CHALLENGE AHEAD

In his office in Pioneer Square, Bill Bain unrolls a map of Seattle, rips off a piece of tissue from a roll and smoothes it over the map. He uncaps a felt pen, marks the freeway and circles downtown's neighborhoods - the office core, the retail core, Pioneer Square, the waterfront, Denny Regrade.

Bain is a principal in the architectural firm of NBBJ, which designed Two Union Square and Marketplace Tower and handled the renovation of the Four Seasons Olympic. The firm also is the designate-apparent to renovate the current Nordstrom store for other retail tenants, if the move to Frederick's goes through.

A circle appears around the Kingdome, downtown's southern anchor. A pentagon encloses the Seattle Center, the northern boundary. Seattle's retail core is relatively compact, but, he says, grabbing an orange felt pen and marking the side streets with dashes, it needs activity on the side streets to stitch it together.

The pentagon attracts his attention. Too much entertainment is isolated at the Seattle Center, he says. The symphony should come downtown, he declares, picking up a blue felt pen and filling in a choice site, near the soon-to-be-renovated Paramount Theatre and the future site of A Contemporary Theatre. Done. The nucleus for an entertainment hub.

Another sheet of tissue goes down. He scrawls lines radiating from the harbor, which he sees as the city's center stage.

On stage are ships at anchor, ferries and freighters plying their routes. The jagged white line of the Olympics forms a backdrop and, across the water, Seattle's seven hills ring the stage, rising steeply from the harbor to form a natural amphitheater.

That's one vision. Imagining a future for downtown, and filling it in, that's the challenge.

----------------------------- MAYOR STORES THAT HAVE CLOSED ----------------------------- -- 1966 MacDougall's, a department store at Second and Pike, closes after 92 years downtown. -- 1968 Rhodes, a department store at Second and Union, closes after 71 years in business. -- 1974 Kress, a dimestore at Third and Pike, closes after 50 years. -- 1975 Doces, a major Sixth Avenue furniture store, closes and says "the business is not here." -- 1982 Ernst, with a hardware store on Sixth Avenue, closes after 80 years downtown. -- 1982 J.C. Penney, the last of the Second Avenue department stores, closes after 50 years. -- 1992 Frederick & Nelson, the landmark department store at Fith and Pine closes after 102 years. -- 1992 Klopfenstein's, a Sixth Avenue menswear store, closes after 69 years. -- 1993 I. Magnin, the upscale Pine Street apparel store, closes after 67 years downtown. -- 1994 Woolworth's at Third and Pike, closes after 87 years.

-------------------- BEYOND THE TIMELINE: -------------------- Downtown still is attracting the attention of major retailers. Here are some of the stores that reportedly have been considering opening downtown. But many of the plans are contingent on whether Nordstrom moves into the Frederick's building.

Nike Town - High-Tech shoe place. Sak's - Specialty apparel shop. Crate and Barrel - Housewares. Barnes and Noble - Books. Planet Hollywood - Glitzy restaurant chain. FAO Schwarts - Upscale toys. Ross Dress for Less - Discount apparel. J. Crew - Casual apparel.