After years of empty storefronts, downtown Santa Cruz is filling up. Twenty-nine new businesses have opened since January 2025, Lookout Santa Cruz reported, citing Rebecca Unitt, the city's economic development manager.
The numbers
Pacific Avenue had 17 vacancies in April 2025, a 16% vacancy rate, according to the Downtown Association of Santa Cruz. By February, the association said, the count had dropped to 10, and ground-floor vacancies across the district were at 9.2%. Foot traffic reached 9.3 million visits in 2025, up from 9.2 million in 2024 and 8.7 million in 2023.
What's new
New 2026 arrivals listed by the Downtown Association include Anthropologie on Pacific Avenue, Gran Gelato Cafe and the cocktail bar The Alley Oop on Cedar Street, the vintage-style lounge The Hotel on Locust Street, and food stalls at Abbott Square Market. More than 85% of downtown businesses are locally owned, said Jorian Wilkins, the association's executive director.
Why now
Unitt told Lookout that 645 new homes built or planned downtown are giving businesses a stronger customer base. The city's Downtown Pops! program subleases empty spaces to new businesses at lower rates, and a vibrancy ordinance waives up to $14,000 in building permit fees for up to 20 applicants. Fifteen businesses citywide have used it, eight of them downtown. A use-extension ordinance also spares some new businesses a permit process that can take three months and cost $4,000.
Sales tax revenue continues to rise quarter over quarter and year over year, Unitt said.
Still empty
Two of Pacific Avenue's longest vacancies, the former Palace Art & Office Supply and Logos Books & Records, have hosted only short-term markets and events. The Santa Cruz Mountains Makers Market returns to the Palace space on weekends this holiday season.