Is Business Drying Up in Downtown C'Sted?  

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sugarlander
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March 20, 2010 3:53 pm  

The reason I ask is there are so many restaurants for sale downtown. Bombay, Zebo’s, Paradise Café, and Kendrick’s are all for sale -- just to name a few. I know businesses are sold for a lot of different reasons but it has me wondering.

I've eaten at all these establishments and the food is fine. My theory is that the more upscale dining establishments are suffering more in a tough economy. But there could be a lot of other reasons for all these MLS listings.


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STXBob
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March 20, 2010 4:38 pm  

My theory is that the more upscale dining establishments are suffering more in a tough economy.

Good theory. I'd say vacations and fine dining were the first victims of the recession, starting about 18 months ago.


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Jumbie
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March 21, 2010 10:50 am  

Tend to agree with the upscale dining places being effected by tough economy but also would add just about any of these types of business's are always out there for sale at some high number, just in case some other "party" comes along and offers full asking price.. Even the Buccaneer Hotel property is for sale. As I heard it Armstrong family asking a cool $60 Million.

Keith Crilow


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poorthang
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March 21, 2010 11:25 am  

One of the biggest problems I see on the horizon is the possibility of a .... new Cuba... if Fidel ever decides to kick the bucket...I could see many " new money" projects going there and the rest of the Caribbeans tourist dollars taking a hit...because of the "new" destination.. It seems like I read something awhile back about "Investors" starting to look at that as a real possibility. There is a big history of Cuba being comfy with pre-Fidel players...aka Mafia...Cuba could pose a bigger threat than any other economic factor IMO.*-)


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stiphy
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March 21, 2010 4:37 pm  

Interesting thoughts on Cuba.

I kind of feel like fool me once shame on you fool me twice shame on me though. Didn't most people who were invested there Pre-Fidel lose everything when Fidel came in? I can't understand why anyone would put their development money there versus somewhere that flies the stars and bars guaranteeing at least some level of political stability.

Sean


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poorthang
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March 21, 2010 5:25 pm  

I think the "dirty money " people would have the greatest involvement albeit through major developers....obviously the power structure would be able to cut themselves a nice deal and provide or not provide a haven of sorts for all kinds of activities ..That's why I say aka Mafia...There are plenty of Mafia's Russian,Italian, American... who decides what and who plays will be Cuba's decision and or partner..and problem...Do I think the parties will make the same mistakes as before (pre-Fidel) no way.. It would be much Bloodier the next time.......Keep your friends close and your enemies closer(The Godfather) maybe the Armstrongs see a change coming like that.. $60 million really isn't that much today for a development like they have..There would be huge benefits to Cuba to get back in the game . Just my thoughts...*-)


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terry
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March 21, 2010 9:02 pm  

Cuba opening up will hurt a lot of other vacation destinations as people will flock there for at least a couple of years.


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Neil
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March 22, 2010 10:27 am  

Longer term, I think St Croix in particular needs to worry about what happens when all the Snow Birds get to old to travel.

I'm not sure they are included in the definition of "tourists" but I'll bet these "part-timers" generate more money for the island than the weekly visitors.

Demographically speaking, who's going to replace them?

And rather than worry about hotels in Cuba, St Croix would do well to focus the people living here year-round. The island is big & diverse enough to generate it's own economy without having to depend on tourism.


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STXBob
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March 22, 2010 11:14 am  

When all the current snow birds get too old to travel, I think they will be replaced by the next generation. The US population keeps growing.


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Bombi
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March 22, 2010 12:01 pm  

Perhaps if there could be some more parking, a reconsideration of the gross receipts tax, lower WAPA rates and more reasonable rents town would fill in better. It is just crazy that when a cruise ship comes in on Sunday that C'sted is closed. Maybe the by-pass will make C'sted more pedestrian friendly

optimist with low expectations on STX


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DixieChick
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March 22, 2010 1:00 pm  

i think the economy and also the safety factor of going down town and having an enjoyable night out. you need to arrive early and leave early to be safe. we stay out east.....have nice rest. and don't have to come into town.

if and when the snowbirds die off more just arrive. i dont think they eat out that much. unless early bird specials


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chockman
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March 22, 2010 1:11 pm  

Neil,you hit the nail on the head. The locals are where it is at. They are the only ones who will truly bring sustainment. to the islands.


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Lizard
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March 22, 2010 1:33 pm  

Everything in the past will come to change. Snowbirds of past and present are very well healed financially. The Baby Boomers are not that well off. With this economy the second home/vacation home market has all but dried up. My crystal ball broke some time ago. However you don't have spec builders putting up any new homes. Current Real Estate inventory has taken a little longer to sell but prices have remained stable for the most part.


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bathiel
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March 22, 2010 1:55 pm  

i think the economy and also the safety factor of going down town and having an enjoyable night out. you need to arrive early and leave early to be safe. we stay out east.....have nice rest. and don't have to come into town.

if and when the snowbirds die off more just arrive. i dont think they eat out that much. unless early bird specials

DixieChick, that may be true of some people, but I am one of those snowbirds and, granted, my wife and I aren't in the typical age range of snowbirds, but we eat out a lot. And, we're at the Reef, which is probably 80% snowbirds, and many, many of the people I know here eat out at least several times a week (and not just early-bird specials). And not just eating, but purchasing day-to-day items (like groceries, gas, household items, etc.). So I do think snowbirds account for a large proportion of economic impact on the island--maybe more than anyone realizes and certainly much, much more than cruise shippers or one-week vacationers.

I do think when the current spate of snowbirds are no longer with us they will be replaced by the next generation. The question is, will they come to STX or do they already have affinities for other islands or locales?

Bernie


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stiphy
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March 22, 2010 2:23 pm  

I do think when the current spate of snowbirds are no longer with us they will be replaced by the next generation. The question is, will they come to STX or do they already have affinities for other islands or locales?

Bernie

This is a great question. It seems like a lot of snowbirds I encounter tell me about how St. Croix was really one of the hottest spots in the Caribbean. But for better or worse I don't think STX has that sort of aura about it anymore. The next generation of snowbirds probably haven't even heard of it, many people I encounter from the states don't have any clue where or what St. Croix is.

The question of what happens when the baby boomers start dying is much bigger than just this though. I often think about who will buy all the new houses they are building when boomers are no longer buying second homes (as Lizard mentoned)? How will the Social Security Ponzi scheme be sustainable? It's an interesting subject, I actually think that it will affect the island probably a bit less than it will affect other areas of the US though. It seems that the island has far less of the booms and busts of the mainland which should shield us a little bit. Or maybe we just already have all the problems that the continent will end up having so we are used to them!

Sean


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speee1dy
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March 22, 2010 3:08 pm  

poorthang, read " Havana Nocturnal" it tells the story of the mobs involvement in Cuba.
and did you know that Milton Hershey had a sugar plantation in Cuba? I think it was taken from him, can't remember that far back. His was an interesting biography. Also his was one of the few companies that maintained a profit during The Great Depression.


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poorthang
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March 22, 2010 4:27 pm  

Thanks speee1dy, I'll put that on my to read list. I really like the stories of such as you might have guessed.


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DixieChick
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March 22, 2010 5:46 pm  

sorry bernie i didnt mean early bird specials in the "denneys" sense....i just meant that they seem to go out earlier (but hey i am not a snow bird and i am home early) but snowbirds like us year rounders have your own facilities to cook at home, so why go out all the time.

the restaurants are killing themselves. with the economy they have not really cut back prices.

i think (and alot of my friends agree) the menu needs to have two sizes....small and regular. smaller portion for less money.

and maybe during off season cut out some of the high end dishes and do more basic things.

for a couple its around 60 plus dollars just to go out to eat counting drinks. alot of times more.
we went out last night and for two people it was 70 dollars. and nothing fancy.

and the clothing stores???? well thats another matter. again why would you buy a dress down town for 50-60 dollars when you can go online and buy it for half that price??


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Lizard
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March 22, 2010 6:25 pm  

Most of the ships are gone before the evening meals are served. The Tourist that come by plane are the targeted customers, snowbirds and full time residents. ST Croix was never a hot spot for tourists, it has always been considered the Red Headed Step Child of the US Virgin Islands. Unless you played Golf. ST Croix got the casinos, The "DIVI" is cute but will not draw the High Rollers.


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Neil
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March 22, 2010 6:50 pm  

When all the current snow birds get too old to travel, I think they will be replaced by the next generation. The US population keeps growing.

You'd think so, but many of the experts say we're headed for a rude awakening. Take Soc Sec for example. The payroll tax will have to increase by 50% over the next 20 years in order to be able to pay for retiree benefits, in part, because there are too many retirees and not enough workers to support them. Recently, many potential new snowbirds experienced substantial losses in their home equity and appreciation and retirement equities, while income has remained substantially neutral and taxes are going up. With regards to a growing population, I would predict that it only means more people who can't afford to vacation or live here for part of the year. And most of the population growth has occurrred in middle and lower income

The longer term solution is to build the economy here so people or WORKING age can afford to live and work here. When it takes $300,000 to 400,000 to buy a 2 bedroom condo here on St. Croix, plus associated condo dues, KwH and high cost of air travel, and workers have to take a 25% pay cut to live here -compared to the same job stateside, you have a potential long-term problem.

On a happier note: The other day my agent said she had a "bargain" available for only $700,000. 😎


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bathiel
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March 22, 2010 8:05 pm  

i think (and alot of my friends agree) the menu needs to have two sizes....small and regular. smaller portion for less money.

I could not agree more. I have stopped ordering entrees because I'm not a big eater and can't justify spending $30 on a plate that I'll only each a third of. I only order appetizers now (and my current fave is the char-grilled calamari at Savant!).

Bernie


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STXBob
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March 22, 2010 8:16 pm  

I agree with, "Order less, and you'll pay less." I prefer to be entertained by the company of my dinnermate(s), not by the spending of extra money on something for which I will have nothing to show.


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sugarlander
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March 22, 2010 11:29 pm  

No doubt about it, being middle class is tough on St. Croix. They pay proportionally more than the states for the basics of housing, utilities, food, etc. That's less discretionary income for eating out and entertainment. In a good economy, it's a challenge for the higher end restaurants. In a bad economy it's got to be bleak to be an operator of one of these establishments.

The working poor on the other hand are REALATIVELY better off than the states. There is more of a safety net that covers more of the basics. With community housing, subsidies for utilities and food along with a milder climate, there is discretionary income to eat out. But it’s typically not spent at the higher end restaurants. I haven't seen any evidence of a slowdown at McDonalds, KFC, and many budget priced restaurants. Crucians are THE mass market on STX.

Many of the high end restaurants aren't set up to do volume. They can't really transform themselves into a budget restaurant and decrease the average ticket. These places have a lot of overhead to cover: rent, WAPA, food costs, staff and the like. Furthermore, running a restaurant is hard work with very long hours so there's got to be reward for doing it.

We can't control shifting demographics, the future of Cuba, or many other factors. However, there are things that could be done that would help the survival and prosperity of restaurants downtown. It’s been mentioned many times in many threads. But I’ll go ahead and repeat them.

Lower the cost of electric by migrating to lower cost energy sources. Institute police patrols downtown. Promote St. Croix. Hold property owners accountable for the condition of their property. In return for subsidies, demand that the airlines lower the cost to fly to the island.

The preceding things are well within the government’s domain. Hopefully, our government will make progress in these areas. But I haven't seen it in the two years I've lived here.

In the mean time, I’ll do my best to keep the money circulating on the island by patronizing all of these establishments.


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speee1dy
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March 23, 2010 11:15 am  

dixiechick, i like your idea of smaller portions for smaller prices. when my bf and i go out to eat, we generally can not eat the whole thing so we usually get a couple of appetisers and split them. people dont need to eat two pounds of food at a meal.


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STXBob
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March 23, 2010 12:20 pm  

In 2009, my wife and I spent an average of $49 per meal (mostly dinners) at restaurants, including drinks and tips.

We spent an average of $7 per meal at home.

Those figures are for both us, meaning that each meal at the given price fed two people. We live on STX.

It's not an exact comparison, because dinners are more expensive than lunches or breakfasts, and most home meals are booze-free, but it tells us that, for us, eating out is many times more expensive than eating in. I like to remind myself of that huge extra cost whenever we get the urge to splurge a little too often at restaurants.

If tracking my expenses like this seems odd to some of you, I do it because I want to retire some day, and I got tired of wondering where all the money went at the end of each year. Budgeting and tracking is a common habit of the wealthy. Most of them got that way by saving money, not by spending it!


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