The downtown square of Gainesville was once the center of the city’s retail business. Today, despite a major face-lift and other planned redevelopment nearby, the downtown business district continues to struggle to find a new identity.

At the same time, a soft economy has had an impact on downtown, where 45 percent of the storefronts are empty.

Renovation plans for the midtown area, which are slated to get started sometime this year, could bring more shoppers to downtown.

Currently, downtown is the home of most of the locally owned clothing stores, and those interviewed for this story have no qualms about their decision to be downtown. But one of the largest draws for downtown is food. There are 23 restaurants in the business district. Some locations, however, have become a revolving door of new owners and changing menus.

For Carol Roper, owner of Carol’s Closet, the decision to move from Lakeshore Mall to downtown has been a good one.

The store, which carries ladies clothing and accessories, has a loyal following that quickly responded when the store moved downtown.

"We have a lot of ladies who come and shop and then go to one of the restaurants nearby for lunch," said Roper, who said her business is not limited to local customers. "We have people who come in from White and Habersham counties and from as far away as Toccoa."

But she said there is a natural draw to a downtown area.

"We had people in here the other day who were in town from Minnesota," Roper said.

Christopher Davidson, owner of Christopher’s Bridal and Tuxedo, said that downtown is hurt by what he calls "the parking myth."

"There have been some stores that went out of business that used parking as an excuse," Davidson said. "In a year, we might have five people who say something about the parking. If I go to the Mall of Georgia or Lenox Square, I park further away from where I’m shopping than anyone would on the square."

He said that as he looked out the windows of his store at mid-morning on Friday, there were eight parking places in sight. He said there are times, such as around lunch, when spaces are more likely to be filled.

Davidson, whose store is considered to be one of the anchors of downtown, has watched stores come and go over the years.

"There are some businesses I thought would have made it and there are others that you’re not sure about," he said. "If you have product and service, you can survive. I think the key to surviving in bad times is customer service."

One of the most notable downtown business closures recently was that of Uptown Fitness, which closed at the end of 2007. In April, the equipment left in the building was auctioned off to satisfy the tax lien against the business.

And restaurants have come and gone, too. Rhythm & Brews, a downtown eatery and night spot, closed and has been replaced in its Bradford Street location by a diner called The Daily News. Skogies, a seafood restaurant at Gainesville Marina, will be opening sometime this fall in what used to be the Boiler Room.

Scott Dixon, who opened Scott’s on the Square in December 2007, said his business, like many restaurants, has had up and down weeks, but is pleased with his first year.

"We missed having our best month in August by about $1,000," Dixon said. "I prepare graphs of my sales (and) it looks like an EKG. It is dependably erratic."

Joe Burnett, executive director of Main Street Gainesville, the downtown development organization, said downtown is suffering from the same pressures that all segments of retail are facing in the current economic situation.

"Retail, across the board, is under tremendous stress right now," Burnett said. He believes the downtown district will pick up as the economy revives.

Many downtown property and business owners also are pinning their hopes on a $35 million development in Gainesville’s Midtown that will feature a 13-story hotel and two 11-story office buildings on Jesse Jewell Parkway.

Gainesville City Council unanimously approved a zoning request for the project, which will include an enclosed pedestrian walkway over Jesse Jewell Parkway that will give patrons of the Midtown development direct access to the Georgia Mountains Center. The exiting point on the square’s side of the bridge will place pedestrians outdoors in front of the Mountains Center, which is within walking distance of the shops and eateries surrounding Gainesville’s downtown.

Gainesville’s Wendell Starke, owner of City View LLC, has joined forces with Atlanta-based P.C. Management Co. to form Gainesville City Center LLC, which will oversee the 5.5-acre project. City View Plaza LLC owns much of the property zoned for development, including Town View Plaza shopping center and two smaller strip malls.

In addition, the company recently purchased the city’s public safety building to make way for the roughly 250-room hotel, 8,000 square feet of retail space, a 5,000-square-foot conference area and 995 parking spaces on a block surrounded by Jesse Jewell Parkway, Bradford Street, College Avenue and Town View Plaza.

Lee Caswell of P.C. Management Co., who also built and sold the seven-story Wachovia Center on the corner of E.E. Butler Parkway and Jesse Jewell Parkway, has said the Midtown project could have a positive affect for businesses on the square. He added that he does not foresee competition between businesses on the square and businesses located within the Midtown development.