Hillsborough businesses struggle as construction continues

Merchants report low summer sales as street renovations limit traffic, parking

Ty Johnson

Editor in Chief

Nathan Phillips stands behind the counter in Pearl Cafe bent at the waist with his elbows resting on the counter.

It’s 5 p.m. but he’s alone in his bubble tea shop staring past the empty chairs and tables at Hillsborough Street.

He steps outside to sit on his store’s patio furniture at the corner of Hillsborough and Pogue streets.

Despite the inactivity on his side of Hillsborough, the other side is bustling with activity as workers and machines dig away as part of the street’s renovations, which have been over a decade in the making.

“It sucks,” Phillips, co-owner of the cafe said of the construction’s impact on traffic to his business. “In all the meetings they promised me that would be the only place you could cross over here for three blocks in either direction. They built a fence and put up a concrete barrier. They took the signal down. You can’t cross there without taking your own life in your hands. They haven’t done one thing the way they said they were going to do it.”

Phillips said beyond the lack of revenue during the summer months of construction is the looming notion that things may not get better when students return for the fall semester.

“I don’t know if it’s going to change in July when the kids come back for the second semester. I don’t know if it’s going to change in August,” Phillips said. “They keep saying if everybody can wait a year and a half it’ll be great when it’s all over.”

Phillips said the real issue he has with the construction is that it was planned to begin last year, when the economy was stronger.

“I knew they were going to do this,” Phillips said. “But they swore to me they would start last year when I had money in the bank and if they had done this when they said they were going to do it I could probably weather the first six or seven months, but they waited until great depression time.”

Mitch Hazouri, owner of Mitch’s Tavern since 1972, said the lack of sales is lower than he’s seen in decades.

“It’s been the worst in a long time — like since the seventies,” Hazouri said. “It’s pretty cataclysmic.”

Hazouri said his viewpoint differs from other merchants on the street, though, as he doesn’t think the construction is all to blame for the lack of sales. He said Hillsborough is just morphing from a local street into what most college areas around the country are –quick service food and beverages run on a corporate model infrastructure.

“There won’t be any more full-service places,” Hazouri said. “You look all around the nation at big universities and you see pizza by-the-slice, Chinese and Mexican restaurants — that’s what’s going to be along Hillsborough Street. There’s not going to be any more Mitch’s, no more Foster’s, no more Porter’s. The parking can’t support places like that.”

Hazouri said the limited parking on Hillsborough and increases in parking enforcement in the area have crippled businesses.

“We need a local street that nourishes the community,” Hazouri said. “It’s hard to do anything when everything is driven by a corporate model.”

Alan Lovette, owner of Melvin’s and Five O’Clock Sports Bar, said Phillips’ restaurant wasn’t the only one feeling a pinch because of the construction. Lovette said he met with University and city officials two weeks after commencement and discussed how businesses were doing.

“We saw a reduction in sales of about 35% in sales per day after school let out,” Lovette said of his own and about ten other restaurant owners he spoke with. “When they put the orange mesh fencing up across the street we saw about another 25% drop.”

Lovette said the officials told him the reductions in sales were solely due to fewer students being on campus, but he said he wasn’t convinced.

“I just talked to Wachovia bank today and they’ve already started making phone calls –they’re livid about it,” Lovette said. “Their transactions are way off on Hillsborough Street compared to the same time last year.”

Lovette said the reduction in sales had a lot to with the construction area, as well as the area crews have roped off where construction hasn’t started.

“Right when they put the orange mesh up, they put up barrels too,” Lovette said. “Even though the barrels are up, they’re not doing construction in all that area, but they’re taking up the whole area with those barrels.”

Lovette said he’d like it if they didn’t have to put the barrels up until they needed to, but understood the decision was likely to make the traffic pattern more stable.

As for what his business will do to weather the perfect storm of economic woes and construction, Lovette said his business will try to absorb the losses.

“We’re trying to just endure the summer,” Lovette said. “Orientation will help us a little bit, it has in the past.”

Beyond orientation, Lovette said fall events would likely help the businesses, since merchants could count on the Haunted Hillsborough Hike and the Homecoming parade.

“Provided they’re going to have the Homecoming parade on Hillsborough Street,” Lovette said. “We would like to have an answer about that.”

Phillips said he would like more answers about why the project was postponed and why the city wasn’t more up front with merchants about the reality of the losses they would experience.

“They did this on Fayetteville Street, they did this on Glenwood — they lost 40 to 60 percent in business in both of those places,” Phillips said. “They knew it was going to hurt business on this street. I think they showed just a fundamental lack of good judgment. They postponed this last year when the economy was good and doing it this year when the economy was bad is just like a big ‘**** you’ to every business on Hillsborough Street.”