Is Merced’s economy improving? Business owners say yes.

Local investments are driving up interest in commercial real estate in downtown Merced and optimism in the minds of business owners, according to agents and owners.

The biggest investment is coming from the state in its $1.3 billion 2020 Project at UC Merced. Business in downtown Merced’s year started out better than previous years, according to Vinnie DeAngelo, owner of Bella Luna Bistro and Bar.

“You got a lot of good business owners downtown that are resilient to all the elements that Merced faces,” he said. “We’ve weathered the storm, all of us. We keep it together so downtown does look like a good destination.”

The 350 W. Main St. building is up for sale with a $1 million price tag, according to its listing with Century 21. An owner for 22 years, DeAngelo noted it’s the building that is for sale and not his business. Bella Luna plans to stay in its current location.

By all accounts, UC Merced was placed in the community with the promise it would bring big changes. “We’re finally starting to actually feel it,” he said.

Though not officially a part of the 2020 Project, the university also is adding its $45 million UC Merced Downtown Center, a 67,400-square-foot building capable of housing approximately 370 employees.

Hundreds of more people working within walking distance of the entertainment district should serve business there, according to Terry Ruscoe, owner of Merced Yosemite Realty in Merced.

“They’re going to want to find places to eat lunch. A lot of them are going to hang out after work,” he said. “The downtown is going to see that it’ll help with its resurgence.”

As more and more shoppers go to their phones and computers to shop from retail stores, he said, interest in retail space has continued to drop. The downtown could benefit by continuing to add places that can’t be experienced through a touch screen, he said, like restaurants, bars, and gyms.

His company has three locations in the downtown area on the market and with a waiting list of buyers. “I can tell you a year ago that would not have been the case,” he said.

Also on the market is the Hotel Tioga, the one-time Bank of Italy on Main Street and an office complex on 20th and O streets, to name a few, according to listings.

The larger economy in Merced has improved as well, according to a report released this month from Gökce Soydemir, business economics professor at California State University, Stanislaus. Total employment in Merced grew by 1.51 percent in 2016, about the same rate as the San Joaquin Valley average.

Two tenants plan to fill empty storefronts in downtown and two more are looking at locations, according to Frank Quintero, the city’s economic development director. He stopped short of revealing the names of the tenants but said they are not chain stores.

Quintero touted the city’s efforts on the El Capitan Hotel and Mainzer Theater, which are set for multimillion-dollar upgrades from the same developer.

“There’s an economic development strategy and there’s a strategy for downtown, and we’re following those,” he said. “That’s why you are seeing the investment that’s coming into the downtown.”

This story was originally published May 5, 2017 at 5:54 PM with the headline "Is Merced’s economy improving? Business owners say yes.."