Full steam ahead?

Six months after the light rail began operating, Jaffa Road store owners say it’s too early to tell if business has improved.

Light rail 150 (photo credit: Marc ISRAEL Sellem)
Light rail 150
(photo credit: Marc ISRAEL Sellem)
Last Friday close to noon, Rami Meir, the owner of the Jordan bookshop in Zion Square, held his breath for two seconds, and then forced a thin, sarcastic smile. The light rail train cruised along Jaffa Road and, upon arriving in front of his shop, sounded its horn. Meir said, “Hear that? That is a new honk, and that’s the best improvement those geniuses at the light rail and the municipality could come up with in response to our many complaints!” “Wait until after the end of the winter” was a statement that several merchants on Jaffa Road echoed last week to assess the impact the light rail might have on their businesses.
Six months have passed since the silver light rail cars began carrying passengers, and the opinions about its benefit to the city’s economy are mixed.
Has it boosted businesses in the city center? Has it brought about a change in customers’ habits – are we seeing a move from the large malls back to the city center? Is it beginning slowly or is it too early to tell? There are many questions, very few answers, and in the background the disgruntled feelings of the merchants, who still cannot forgive the municipality and the other parties involved in the project.
“Twelve years of unspeakable suffering, of dirt, noise, neglect, with an unprecedented loss of income, with so many businesses that couldn’t make it, so many who gave up, who shut down stores that had been here for decades. There has been so much destruction, that it’s too early to say if something good is going to come out of it,” says Uri Amedi, director of the Lev Ha’ir neighborhood council, which oversees the plans and the renewal in the downtown area.
“I agree it is a long process,” says Moti Hazan, CEO of the Jerusalem Development Authority, which manages all the projects related to the city center for the municipality.
“But if during the roadworks it was difficult to see the benefit that would come out of the light rail, today all the parties involved, including the merchants, see the light at the end of the tunnel.”
Most of the merchants believe that things will improve.
They all say that winter, especially such a rainy winter, is not the right time to judge the effects of the light rail on the economic changes in the city center. There are also differences between the Mahaneh Yehuda area on Jaffa Road compared to the rest of the light rail’s downtown route. In the section closer to Safra Square, for example, one can already see many coffee shop terraces and elegant new shops replacing some of the bazaar-type stores.
However, there are some positive indications that are raising the morale of most of the business owners along Jaffa Road, especially in the section between Safra Square and the King George–Straus intersection. The first good sign is the increasing number of people who are going downtown, albeit not necessarily to shop. The second positive sign is the increase in rental prices along Jaffa Road, Ben-Yehuda and King George.
At the same time, several municipal initiatives are a clear indication that the economic aspect of the renewal project of the city center is being taken seriously and might bring about some benefit. One of the proposals is to eliminate the VAT on merchandise in the downtown stores for two years to draw more customers to the area.
ACCORDING TO Hazan, the major change is linked to the municipality’s recent decision to sign an agreement with Eden (a subsidiary of the JDA) for the next 10 years to promote various projects and programs in the city center.
“One of the first steps taken by Eden, under the JDA’s supervision,” he adds, “is to take an active part in the business aspects – no longer just market trends but also serious, well-prepared activity to bring in new business to the city center with our support and help. That is a major change in our strategy.”
“The problem is not whether to have the light rail,” says Meir. “It is here anyway, and though it drives me crazy to see how deaf the municipality is to understanding what improvements are needed, we are beyond that question today.”
What bothers Meir and many other merchants is what he calls the total inability of the municipality and the light rail management to run such a large project.
“In principle, the light rail should bring more people to the city center, and naturally they should become our customers and improve the commercial life of this area,” says Meir, “but at CityPass [the company that operates the light rail] they haven’t even solved the problem of the electronic ticketing, so how can we rely on these people?” While attending to his customers, Meir points out some other issues he says the municipality hasn’t been able to resolve, despite their urgency. For example, the dirt in the streets, the foul smell that emanates from under Zion Square which, he says, no one has managed to locate and deal with. But above all, he says, the light rail is still not sufficiently convenient to attract enough people.
“But that being said, we should really wait until the winter is over. Once the rain and the cold are over, that will be the real test. In general, despite the criticisms, I am optimistic,” he says.
Meir’s neighbor on Jaffa Road, Jacky Khalifa, is also optimistic.
But both are not short on criticism about the municipality. Khalifa, the owner of the shoe store at the corner of Jaffa Road and Harav Kook Street, answers questions while serving his many customers. The little shop is packed and Khalifa, with the help of three saleswomen, pays close attention to each client’s request.
Until not so long ago, he was among the fiercest opponents of the municipality’s policy in regard to the roadwork for the light rail. Today, he is ready to admit that he can see the beginnings of a positive change.
“We see many more people coming to the city center.
Until recently, this area was almost a ghost neighborhood,” he says, but he adds that the change is still not felt significantly in his or other stores.
What has really changed, says Khalifa, is the atmosphere.
He points out that although there are still many bazaar-like stores along Jaffa Road, the rate at which new coffee shops are opening shows that things are going in the right direction.
“Once people find their way back here and find where to go and where to sit, we will see a real change for the better. For the moment, we see more people walking around, not many more, but it has been very cold and rainy, and that doesn’t help.”
Khalifa, Meir and many other shop owners still feel angry and frustrated at the way things have been decided without taking them into consideration or inviting them to be part of the process.
“They are absolutely right. Altogether it has been 15 years of a real nightmare,” says Amedi. “It’s too early to see a real change. Profit, rise in income and success in business will take more time. You can’t expect to repair such a disaster in six months, so the revolution in terms of the city center economy that we have been promised is far away, and that’s why the municipality has to find ways to boost the economic life there.”
ONE INDICATION that things are nevertheless moving in the right direction is the increase in rental prices.
While the improvement in the revenue of the shops is still slow, real-estate prices – rentals and sales – are skyrocketing in the compound between Ben-Yehuda, Jaffa, King George and the small streets of Nahalat Shiva.
Zvi Barak, head of the Commercial Department of Anglo Saxon Real-Estate, admits that there are considerable changes in the city center but says one should be careful not to mistake trends for facts. He says there are some indications. For example, business owners who feel that prices are rising are asking higher prices for their properties, which previously had not been considered potentially successful.
Barak confirms that there has been a tremendous increase in realestate prices in the area, both in rentals and property sales, up to 200 percent from what was seen until a year ago.
Another positive indication is the magnitude of investments and development in the city center through the JDA and Eden. After the first NIS 300 million invested by Eden, another NIS 150m. will be invested over the next five years in various projects aimed to boost the renewal and development of the area.
Hazan points out that besides efforts to bring new businesses to the downtown area, the JDA and Eden are focusing on having the established merchants take a more active part – again, with generous support at hand.
“It’s not only Jaffa Road, it is also the small streets in the area. Take for example Yoel Salomon Street in Nahalat Shiva. For Hanukka we worked together on a special event, which was a complete success judging by the number of people and customers who came. We installed festive lighting, helped with a fair on the street, the merchants came with their ideas and requests, and together we ran something nice. Even if for the moment not all the people who come to the city center are big spenders, it’s a beginning.”
Kobi Kahlon, deputy mayor and chairman of the planning and construction committee, believes that things will take more time, and not just because of the economic aspect. He says it is first and foremost a matter of urban identity. “The new city center hasn’t yet reconstructed its new identity after the intifada and the roadwork.”
The municipality has invested quite a lot of money, such as grants for upgrading the store windows (up to NIS 7,000 for each shop); nevertheless, only 350 store owners have taken advantage of this opportunity. Employees at the municipality believe that there wasn’t enough pressure on those who were reluctant to use the money to renovate their windows.
“As a result, too many store windows in the city center look terrible, not inviting and cannot compete with the modern facades of Malha mall for instance,” says an employee on the committee.
Another issue is the size of the commercial areas downtown.
“Customers are already used to the large mega sizes of the malls. In the city center, you can’t find such sizes,” continues the source, “and that’s also something that prevents or slows the changes we all expect in the city center. And there is no question that the city center still looks bad – too many bazaars, dirty, neglected. This will have to change.”
It is interesting to note that the entire downtown area has only six street cleaners during the day and three sweepers at night. Everyone agrees that this is not sufficient to keep this large area clean. But for the moment, due to the plans to privatize the cleaning services in the city center, everything is frozen on this front.
Kahlon admits that the increase in real estate and rental prices shows that at least businessmen believe that the city center has a chance of becoming a success story, but he adds that too many obstacles still slow the process, such as the low buying capacity of a large part of the residents. “People won’t come downtown if they know they don’t have parking available, despite the convenience offered by the light rail,” he points out. “The city center has once again become a legitimate part of the life of Jerusalem residents, but for the moment it is more a place connected with entertainment and culture than with business and shopping. That will take time.”
TOO MANY projects that were supposed to boost the city center are still being blocked or have been canceled. The Mapai House project (corner of Jaffa and Wallenberg), a landmark building designated to be a large residential and commercial center, is blocked because there is still no agreement about the preservation conditions or the corner off side, which is slated to be a business area with a large underground parking area, which for now remains an abandoned plot.
At the planning and construction committee, these and other cases are examples of the complexity of the vast project to renovate and build up the city center. The fear is that since a large part of Jerusalem’s population is poor and cannot afford to spend too much money on luxury shopping, the present situation, with many cheap stores filling up Jaffa Road, will persist, and profitable commercial activity will not be conducted there anytime soon.
“We have fewer problems in the shuk area,” says Amedi. “There we are programmed to offer culture and tourist entertainment, and it works very well. It’s a big success, but that’s not business as we understand it today.”
For Kahlon and his team, the major question that remains is to see how the city center will return – or not – to its previous position in the residents’ mind.
“The Jerusalem city center of years ago does not exist anymore,” says Kahlon, “firstly because the city now has many additional ‘centers’ elsewhere – the malls, for instance. So we are in a different period.
We have to see if the light rail, the renovation of the streets and the sidewalks, the street lamps, the shop windows – if all that leads to a renewal of this area, and that is too early to say. We have some good examples of success – like the Even-Israel renovation, with restaurants and bars, or the Bezalel-Shatz area, with the fair and the boutiques – but there are other parts where it is not clear if it will reach that level of success.”
But not all parties involved sound optimistic. Eli Levy, president of the city center merchants’ association, says it won’t work, despite all the goodwill invested.
“Firstly, the light rail hasn’t brought about, in my view, any serious positive change,” he says, but adds that from the beginning, those who expected a transportation system to bring solutions to such a huge problem as the economic life of the city center were not being realistic.
“What we need are dramatic solutions to a dramatic situation. If the initiative I am promoting with my colleagues to convince the prime minister and the Treasury to free the city center zone from VAT is successful, then we will see a dramatic change. Anything else [proposed] is cosmetic.”
In regard to the rise of real estate prices in the city center, Levy says it is not the whole picture.
“The test is how easy it is to rent a place. In Mahaneh Yehuda or in Mamilla, it will take you at least two years to get a shop to rent.
In the city center, it won’t take you more than two months. That’s the real picture, and that is what has to be changed, quickly.” •