Paul Kuppalli is in a holiday rush -- not to buy gifts but to put them on the shelves of his downtown shop.
Last week, he opened Manasa's Cards & Gifts at 19 S. Charles St., a location that once housed a bank branch office. Now he's in a race against time to display calendars, boxed chocolates and porcelain dolls so office workers can buy them as Christmas presents for colleagues or as last-minute gifts for the family.
The 48-year-old Harford County resident, who has run a similar store in the 200 block of E. Baltimore St. for seven years, has a simple explanation for his decision to open another: "To make money."
But Mr. Kuppalli also senses that his new venture carries more than the usual element of risk.
"They have to do something to bring all the offices back downtown," he says. "I see a lot of offices moving out. I'm really concerned."
Mr. Kuppalli's qualified optimism about his new shop is a microcosm of the attitudes toward downtown retailing.
If downtown stores are to emerge from the doldrums of the last decade, it will take more than a busy Christmas shopping season, say business leaders, city officials and economists. Success, they say, will depend on whether the city can lure more businesses and tourists downtown -- and whether downtown stores offer something their suburban counterparts cannot.
Downtown retailing probably will never regain the prominence it once held, says Marc V. Levine, director of the Center for Economic Development at the University of Wisconsin-Milwaukee.
"Retailing has become decentralized and suburbanized," says Mr. Levine, who has studied Baltimore and its redevelopment.
"Traditional retailing in general is having its problems," adds Richard H. Bradley, president of the Washington-based International Downtown Association. "Where the growth in retailing is taking place is in specialty retailing, entertainment and restaurants."
Figures on downtown retail sales do not exist. But citywide sales tax figures hint at the problems faced by shopkeepers in the central business district.
Since 1985, tax receipts for apparel and general merchandise sold in Baltimore rose from $23.9 million to $28.3 million -- an average annual increase of 1.5 percent, according to the state's comptroller. Meanwhile, such tax receipts for the rest of rTC Maryland rose from $244 million to $393 million -- an average annual increase of 3.8 percent.
Even before the recession, the number of workers in Baltimore was declining. In 1990, the city had 396,360 workers, down from 431,981 in 1980, according to the Baltimore Metropolitan Council. The number of workers commuting to the city from Baltimore County during that time declined to 123,587 from 142,739, the council said.
The drop in employment is one reason for empty offices. The downtown office vacancy rate is 18 percent, according to a recent survey that said the area had its worst leasing results in more than a decade. The roster of blue-chip companies that have cut staff includes IBM Corp., USF&G Corp. and legal powerhouse Venable, Baetjer and Howard.
Little wonder that downtown retailing has suffered.
"Retailing is a follower," says Walter Sondheim Jr., the sage who is a special adviser to the Greater Baltimore Committee. "Retailers go where the customers go."
Many downtown merchants have felt the exodus of shoppers.
Melvin Mazer, 72, opened Harbor Jewelers with his son, Stanley, 47, at the corner of Light and Water streets in 1980 -- in the glow of Harborplace's opening and before suburban Owings Mills and Towson Town malls were anything more than a gleam in some developer's eye.
For a few years, the Mazers say, business boomed, and they needed four employees to help them meet the demand. Now, it can barely keep the two of them busy.
"I used to see anywhere from 30 to 45 people a day. Now it's down to 12 to 15," says the elder Mr. Mazer.
Several retailers packed up and left. Walk down almost any downtown street and you can see the impact of their departures in empty storefront windows.
"In the mid-1980s, there was virtually no retail space to be had. Today, there's a lot of it," Thomas H. Maddux, an associate with the real estate company KLNB Inc., said, estimating that at least 20 percent of the downtown retail space is empty.
The Downtown Partnership's inventory of retail space runs 2 1/2 pages and includes several properties in prime locations along Light, North Charles and Pratt streets.
Executive Director Laurie Schwartz says the business group doesn't monitor how much retail space is available annually, but adds that she senses "it's slightly less than last year."
Last month's opening of Young World, a New Jersey-based children's clothing discounter that took over part of the former Epstein's department store in Lexington Mall, was also "a very positive sign," she says. "When a national retailer opens up, there are often other retailers that follow suit."
