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Gary faces a number of challenges in bringing back retail businesses to the city, including crime, blight and perception, said Aaron McDermott, president of Latitude Commercial Real Estate Services in Schererville.

After an almost textbook case of Rust Belt decline over the past half-century, the Steel City's reputation has suffered because of violent crime, boarded-up buildings, gang battles over street corners, and its FBI-designated status as the murder capital of the United States during the 1990s.

“There are a number of issues with retail in Gary,” McDermott said.

“First is perception. There is a perception, whether real or not, that Gary is simply not safe to have retail businesses located within it. This came about on a tour I had a few years ago with a national retailer looking at Gary. While there was one particular location that made some sense, the operational manager denied the site due to the crime statistics they looked into at the site.”

While it doesn't help that fast-food and liquor store clerks are shielded behind bulletproof glass across the city, there's also Gary's proximity to other, more established retail hubs people are used to shopping at.

“Gary is located in between a few larger retail areas as they are located near Hammond, Schererville and Merrillville,” McDermott said.

"Retailers are being much more strict as to where they locate their brands nowadays. If they think they are already getting that customer to shop at one of their stores, they are not going to see a need to get it closer just for convenience, especially with the ability to send their product directly to the customer now. I think the typical Gary customer is already shopping at one of those locations, so I can’t see a need to get closer to that customer.”

At a disadvantage

Perhaps the biggest deterrence is demographics.

“When retailers look at their reports on trade areas, they look at certain factors that determine whether their concept will be successful at a particular site,” McDermott said.

“Things like median income, population density, daytime (employee) population and average age are just a few factors that come into play when analyzing a market. If the market does not score above their benchmark standards, then that site is not going to be considered.”

Gary is at a particular disadvantage with national retailers, because it’s competing with the entire Chicago metropolitan area for new locations.

“When a market director is trying to decide where to locate, he could be deciding where to locate a certain number for all of Chicago not just whether a particular site in Gary works or doesn’t," McDermott said.

"It could be, do they want to put a location in Gary vs. Schererville vs. Orland Park vs. Oak Lawn?”

The beach helps, for sure

Miller remains one of the last remaining pockets of retail that's thriving in the city of Gary, but it's largely locally owned independent businesses and not national corporate chains. Walgreens recently closed, as did Fagen Pharmacy when it got bought out in 2017 by CVS, leaving the lakefront neighborhood with a population roughly the size of Griffith without a pharmacy.

Isolated from the rest of Gary and once its own town that was annexed into the city, Miller never suffered the same amount of white flight the rest of Gary did in the 1970s and boasts million-dollar homes with sweeping views of Lake Michigan. The artsy enclave has benefited from its beaches on Lake Michigan, the Indiana Dunes National Park, the acclaimed 18th Street Brewery, and the visitors they draw in.

The Gary Shakespeare Co. no longer occupies a black box theater with a Lake Street storefront, but Miller's business district is home to Vibrations juicery and health food store, art galleries, boutiques, restaurants like the tony Miller Bakery Cafe, a comedy club and the 18th Street Brewpub that USA Today just named the best in the country. It's the kind of place one can go to get lobster rolls or a crab dinner, an award-winning IPA, or a plein air painting of the Dunes.

Formerly an assistant brewer at 18th Street, Anna Martinez opened Anna's Kombucha Cafe on Lake Street last year.

Her coffee shop and kombucha bar survived a year of road construction along Miller's main commercial drag partly because of the activism of neighborhood business groups like the Miller Business Association and the Shops on Lake Street, which markets the neighborhood as a shopping destination and promotes First Fridays and other events. Miller's active business community, for instance, puts out billboards on Dunes Highway, encouraging people to shop Lake Street.

"We have such a strong team with Vibrations and (shop) Indie Indie Bang Bang," Martinez said.

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"We come together for meetings all the time. We get people to come together and communicate what we need, such as going to the city about signs about how to reroute traffic while they're working on Lake Street. As a first-year business owner, it was really hard with the construction. But we band together here to solve our problems."

The Miller community is supportive of its local businesses, but it can be a challenge to draw from a wider area outside of the summer season, Martinez said.

"As a city, we face a challenge in that people are unsure of coming here," Martinez said.

"We have stores and products of the same quality as Valpo, if not higher, but we don't get the same press. Maybe people don't think we're as accessible, but we're just down the street from the beach, we have the farmers market, and we have great businesses like Vibrations and Indie Indie Bang Bang." 

So why has retail in Miller continued to thrive?

"The beach helps, for sure," she said.

Investing to keep the doors open

Even Miller has a lot of retail turnover, and the beachfront community is an outlier in a hardscrabble city where many retail shops are just eking out a living.

State Rep. Vernon Smith has owned the Beautiful Things Gallery, Floral, and Gift Shop in Gary since 1973, but he said times are tough.

The business was originally located downtown; it relocated to the Village Shopping Center on Grant Street. The enclosed mall on Grant Street eclipsed downtown as Gary's retail hub after the nation suburbanized during the 1960s, but today is eerily empty with only Chuck Wheeler’s and a smattering of stores remaining.

The Region’s shoppers long have since migrated to newer shopping centers like Southlake Mall in Hobart, Highland Grove in Highland, the Shops on Main in Schererville, and Vale’s Porter in Valparaiso.

Anchor stores like Goldblatt's, J.C. Penney, Kroger and Montgomery Ward have departed, and there's little foot traffic left in the mall. Chuck Wheeler's Vienna Beef Red Hots still draws visitors, but most of its customers park, run in to grab a Chicago-style hot dog and leave right away.

"It's not well," Smith said. "I'm down to one employee. I've had to invest money in it several times to keep the doors open."

Rent at the mall is steep, and the owner hasn't been putting money into the property. People are now more likely to shop at the newer businesses in strip malls along Grant Street outside the mall.

Occasionally the business will get large orders from schools or for a floral arrangement. Beautiful Things still sells a lot of black art pictures and religious items. But gone are the days when it would do robust enough sales on Mother's Day and Father's Day to tide it over for the rest of the year. He hopes more of the city's churches will support the shop.

"I've had to downsize the inventory," Smith said. "I'm being more selective with merchandise that moves at a high volume."

'Hope it's going to turn around someday' 

Small businesses have a tough time in Gary because of lower volumes, which can mean higher prices, Smith said. About a decade ago, Walmart was selling black art for cheaper than what he could buy it for wholesale.

"You’re buying by the case instead of the truckload. Part of it is educating people to spend their dollars in Gary," he said. "The more volume, the lower prices. Community support is a problem, because people are so used to shopping in Merrillville."

But Smith doesn't plan to give up on his city.

"I'm holding onto the business for several reasons," he said. "I hope one day it's going to turn around, and I'll be the beneficiary of the turnaround."

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Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.