Economic pains on display in Dare's empty storefronts

At numerous storefronts up and down the Outer Banks, "For Lease" signs are taped on windows instead of holiday decorations.

Shoppers are pinching pennies, more diners are eating in, and business owners have been forced to lay off workers, shut down early or close their doors for good. With construction and real estate at rock bottom, few entrepreneurs have the means to open new establishments.

As an Outer Banks retailer and Realtor, Greg Deans has been scotched by both sides of the economic sword: retail and real estate. Too many 12-hour days drove Deans recently to close his shop, Shepherd's Pets, at the Dare Centre in Kill Devil Hills.

"I'm 55 and the economy is getting super tough," he said. "I'm done - I'm going to go exercise the barnacles on my boat."

Dean, who still works part time at Christi Realty in Kitty Hawk, said the dozens of vacant commercial properties on the barrier islands are a direct reflection of the 2006 bust in the housing market. One blessing in the downturn, he said, is that inflated commercial space costs have adjusted considerably lower per square foot.

"If there's no real estate happening," he said, "there's no business happening."

Tourism, though down somewhat, was better than expected this year, said John Bone, president of the Outer Banks Chamber of Commerce.

"As long as we can keep our tourism part of the economy running pretty good," Bone said, "it'll come back."

Unemployment in Dare County in October was 8.6 percent, up from 6.8 percent in September, according to the state Employment Security Commission.

Kenny Kee, the branch manager of Dare County Job Link, said many restaurants and retail shops that in previous years stayed open until after New Year's - and some that had operated year-round - closed this year after Thanksgiving.

"I had more people come in in one day than I'd see in a month," he said. "The businesses that are open, they're way down."

The losses are visible along U.S. 158 from Kitty Hawk to Nags Head.

Commercial buildings and strip malls in Kill Devil Hills have a number of vacancies, often for many months, said Town Manager Greg Loy.

Some businesses have moved elsewhere, leaving behind empty buildings. Although the number of building permits is up, Loy said, most of them are for remodeling.

"There's a lot of work being done," Loy said. "It's not the kind that's going to sustain an industry."

In Kitty Hawk, of the town's 360 business spaces, about 22 were vacant, according to town planner Joe Heard.

Four years ago, commercial permits in the town were valued at $24 million. This year, they're worth $879,000. "It's kind of a sad situation," Heard said.

In recent years, many commercial establishments on N.C. 12 - the Beach Road - in Nags Head have been replaced with single-family

houses, said Mayor Bob Oakes.

Oakes, sworn in this month, said the town needs to take a serious look at reviving the road's once lively and quirky commerce, as well as finding ways to be more flexible with non conforming businesses. He didn't yet offer any specifics.

"I just know we have to change," he said. "I f we don't change, we'll keep getting what we've been getting.

"It's got a very direct effect on us, both on sales tax revenue and property tax revenue. I think retail and business are attracted to where retail and business are already. It's not good for the town - period. But some of that is on the shoulders of the owners of the property."

There has been some construction in Nags Head. A new Food Lion was built at milepost 10.5 on the Bypass, with an attached strip mall facing the highway. Across the street, two huge buildings in South Beach Plaza are partially filled with three tenants.

Jim Geraghty, owner of Oyster Bay Realty & Construction in Kill Devil Hills, said he hit financing snags after he started building the Plaza about two years ago.

"There's a lot of competition out there," Geraghty said, adding he recently found two more tenants. "I just think there's so much availability. But also, there's not that many new businesses opening up. It's hard for them to get financing."

About 80 percent of the nine shops at the Food Lion mall have already been leased by established tenants, said H.J. Brody, owner of Greenville developer Brody Co. Highway frontage, reasonable rent and a big supermarket as an anchor, he said, have made it an attractive location.

Catherine Kozak, (252) 441-1711, cate.kozak@pilotonline.com