Is State Street Retail Sliding?

Clarice Clarke is the president of Lee & Associates Central Coast.

SANTA BARBARA—Santa Barbara’s famed State Street—a retail high street in the downtown market—may be sliding. For the first time in a decade or longer, the esteemed retail center has 25,000 to 30,000 square feet of storefronts in a range of sizes available for lease. The phenomenon is a combination of low foot traffic, high rents and arguably more appealing locations in the nearby Montecito and Funk Zone submarkets.

“State Street was the place to go for retail; it was the Wilshire Blvd. or Rodeo Drive of Santa Barbara,” Steve Leider, a principal in Lee & Associates Central Coast, tells GlobeSt.com. “Now, State Street landlords have had unreasonable expectations from a rent standpoint, homelessness is a problem, although it is a problem that Santa Barbara has had and hasn’t dealt with for many years, and retail is competing with ecommerce sites on the Internet. We used to have a lot of mom-and-pops and small boutiques, and today, in the prime blocks, we are going to have 25,000 to 30,000 square feet of storefronts in various sizes available on State Street. We haven’t seen that in 10 years. Even through the recession, we didn’t see that.”