The economic downturn has sent some businesses packing in downtown Hailey. Others are pulling together, diversifying or relocating from the north to survive the recession.
The Main Street Bistro on Main Street closed last month and no new tenants have stepped forward to fill the high-profile space. The closing followed that of Chester and Jake's seafood restaurant at The Mint bar last October, another high-profile space across the street.
"This means less restaurant choices and a few less jobs," said Hailey Chamber of Commerce Executive Director Jim Spinelli, who has seen several businesses come and go since the recession began in fall 2007.
McClain's Pizza in Ketchum has plans to relocate to Hailey in October. McClain's will operate at the "Old Drug Store" building on Main Street, owned by actress Demi Moore.
Jane Drussel, who recently re-opened Jane's Paper Place across Main Street from Moore's property, is upbeat about the Hailey economy, which she says does not fluctuate as much as the more tourist-based economy in the northern Wood River Valley.
"People shop for basic needs, whether it's summer fall or winter," she said. "The rents are more affordable here and at least we have some parking. Ketchum has built a box around itself."
Paula Proctor moved Paula's Dress Shop to Hailey from Ketchum last year after 29 years when her Trail Creek Village location was slated for redevelopment. Proctor has retained some customers from Ketchum who she says stay in town for lunch.
"I think the big picture is a good one," she said. "The South Valley Merchants Alliance works together here rather than competing. I also like the small-town feel. You get the feeling Hailey is happening. Maybe what Ketchum used to be has shifted to Hailey.
Proctor credits the South Valley Merchants Alliance with attracting business to town by organizing holiday festivals and other events.
"They are a pretty strong group down here," she said. "Their event planning is the best I have ever seen. It's almost always family-oriented."
The South Valley Merchants Alliance, in collaboration with the Hailey Chamber of Commerce, has plans for Halloween and Christmas festivals aimed at getting people out and about—and shopping—in the downtown core.
Yet the benefits of doing business in Hailey were not enough to keep the Silver Creek Home Center on River Street in business. It was owned by Albertsons grocery store Assistant Manager Rob Driemeyer, but closed last summer after less than a year.
The old "Sears building" Driemeyer used to rent on River and Bullion streets has recently been taken over by a hunting and fishing store.
<
"I opened six months before the economy crashed," said Driemeyer. "I sold things for homebuilders, so when the housing market crashed my sales were cut in half."
Driemeyer advises local entrepreneurs to be "very cautious" if they have plans to open a new business in town.
"From what I hear, it's damn near impossible to get a business loan these days," he said.
Spinelli said Valley Games on Bullion Street also closed three months ago after less than a year in business. Petals and Stems in Bullion Square on Main Street will soon be replaced by a nail salon, he said.
Spinelli said the Sun Valley Brewery and Wicked Spud restaurant on Main Street are doing well because they have been able to diversify.
"They are expanding to include music and this is a big draw," he said.
Spinelli said Hailey's hotel occupancy rates are down 40 to 50 percent from last summer, but local option taxes are not down as much as in Ketchum because of local attendance at Hailey restaurants. Local option taxes are gathered from alcohol, rental car, hotel and restaurant business. They are designed to tax non-residents.
Ken Sangha bought Main Street property and two businesses in Hailey, including Elbie's Automotive, before the crash. He opened La India restaurant last year. He said he hopes diversity will allow him to thrive in a town with tough zoning and signage laws.
"Some of these laws seem outdated, like not promoting growth beyond the downtown core zone so that people will walk," Sangha said. "A big proportion of the city population lives in Woodside, so they are already driving. The city has grown far beyond the downtown core zone."
Sangha said the response to his opening shop in Hailey has been good, but that the current economy poses challenges.
"People are struggling for the same piece of pie. But I think we have a niche."
Financier and Gimlet resident Steve Holzman bought the Meriwether Building on the corner of First Avenue and Carbonate Street in Hailey only a few months before the housing market crashed. Although only half his commercial space is rented, he remains optimistic about the Hailey economy.
"I would not be human if I said I wasn't discouraged about the local economy over the last year or two," said Holzman from his Manhattan office. "But we invested in Hailey for the long term. We are not immune to the national and international economy."
Holzman, who recently managed a hedge fund, said he has spent money improving his property for when the economy turns around.
"I am committed to making mine the best building in town. When the economy turns around I will get my money back. Unfortunately, that may take a while."
Dick and Melidee Wright, owners of Wright Appliance and Cluttered Kitchen on Main Street, have seen tough times before in Hailey. They have been open 32 years in a building owned by the American Legion, but plan to close shop this fall and travel to Denmark and Australia.
"It's not the economy," Dick Wright said. "We are closing due to old age and sore joints. This is retirement."
Before closing, Wright, the adjutant for the local American Legion Hall, rallied other Legionnaires to cut the rent by 50 percent for a karate studio on the second floor of the building.
"We have to adjust with the times," he said. "When you rent to someone, you want them to stay in business."
Tony Evans: tevans@mtexpress.com
Dick and Melidee Wright, owners of Wright Appliance and Cluttered Kitchen on Main Street in Hailey, are closing up shop after 32 years in business.
Photo by David N. Seelig
