Spotlight / Local Institutions
A Marketplace Overlooking Biscayne Bay as Catalyst for Progress
Bayside Marketplace celebrates its 35th anniversary. A well-researched and compact history of this iconic place. Matilda Kalaveshi.
Bayside Marketplace, like the City of Miami itself, was vastly different in 1987 than it is today. In a historic year that saw Ronald Reagan as president, Black Monday in October and the thawing of Cold War tensions, the City of Miami was continuing to grow, spurred on by immigration and a constant flow of cash from illicit drugs. It was an important year for Miami. Pope John Paul II visited the city. The Miami Tower, a 47-story building, joined the then modest skyline, and Bayside Marketplace for the first time opened its doors to the public. This 16-acre retail and entertainment complex breathed new life into what was once Pier 5, a fishing market and tourist attraction on the decline.
Looking back at the decade, Miami clearly faced many challenges. A cover gracing Time magazine November 23, 1981, read: “Paradise Lost? South Florida”. The piece detailed crime, drugs and immigration in South Florida. It portrayed the city as a lawless jungle fueled by drugs (an estimated 70 percent of all marijuana and cocaine imported into the U.S. passed through South Florida) that impacted every aspect of the economy. In 1980 Miami ranked as the most crime-ridden city in the nation. It generated a fiscal reserve surplus of $5 billion dollars — greater than the nation’s twelve Federal Reserve banks combined.
And the trend continued. The 1987 New York Times article “Can Miami Save Itself: A City Beset by Drugs and Violence” highlighted the history of how the city acquired its “bad reputation.” The path forward for Bayside Marketplace wasn’t always obvious. It had to overcome much of the prevailing sentiment. With geographic shifts towards suburbia, centralized retail shopping and dining became less important. These changes spawned a desolate and abandoned downtown unfit for tourists and locals alike. The need for change, however, was as imperative as ignoring the natural beauty, breathtaking bay views and overall interest in the city would mean denying it its destiny.
James Rouse, a real estate developer and businessman, labeled by Time magazine as “the man who made cities fun again” was a visionary who created some of the most important real estate projects throughout the US. His initial focus on enclosed malls, strip malls and planned communities shifted to festival marketplaces in an effort to bring the same experience to urban communities. Jim and his team were responsible for the revitalization of Boston’s Faneuil Hall Marketplace in the 70’s and Harborplace Baltimore in 1980. According to Jim, the goal of the festival-market approach was simple: giving people a reason to get out of their car and experience the city. He would soon turn his eye to Miami.
The Stuff Dreams Are Made Of
Contemporaneously, former Miami Vice Mayor and City Commissioner, Rosario Kennedy, had a vision for Bayside Marketplace. Taking inspiration from New Orleans Riverwalk Marketplace, she saw the energy, people and the positive impact the establishment had on the city. She and city officials immediately began collaborating with the Rouse team to realize a shared vision. The city approved the $93 million dollar project. “We wanted to revitalize an area of downtown that was ignored and outright dangerous” recalls the Vice Mayor. We wanted to create a place for locals and tourists to eat, shop, celebrate and enjoy all that Miami had to offer.” In the Bayside Marketplace ribbon cutting speech delivered by then Mayor Xavier Suarez, he remarked “Bayside is the stuff dreams are made of… today we bring the city to the bay.”
According to the Miami Herald, the waterfront marketplace opening was attended by over 100,000 visitors. Bayside checked off all the boxes when it came to its offerings: live music, shopping, dining, tropical drinks, experiences (ship tours) and million-dollar views all wrapped up in a bow for the enjoyment of all. The product and category mix were well thought-out with mainstream brands such as The Limited, Sunglass Hut, Lane Bryant, Victoria’s Secret, Footlocker, Sharper Image and artisan shops such as Alexia, Azteca de Oro, Bag ’Em All, Bayside T-Shirts and more. Catering to international tastes, restaurants serving French, Italian, Creole, Chinese, Italian, Latin American and Cuban food occupied the second floor. Experiential retail, a term relating to capturing the customer with experiences and amenities beyond what is traditional, was on full display.
Bayside Marketplace, although ideally located, has gone through its fair share of challenges. Born in the era of illicit drug trade, it is not surprising that some initial commerce was conducted illegitimately. Reports of under the table dealings, bribes and payoffs were rife. As it legitimized, economic forces began to shape the marketplace with financial performance tethered to the boom/bust of the economic cycle. Ownership turnover also exerted its effects on the identity of Bayside. The constant infusion of new ideas was disruptive to the diverse strategy of brand and product mix. Heavy focus on big box retailers and brand names would be a dominant theme for years only to be replaced by “shop local” movements. On the other hand, a significant Bayside advantage remains its strategic bay location. It is in close proximity to the Port of Miami, downtown, and the Miami International Airport. As such, its success has in part been tied to the rapid growth of the cruise ship, travel, and tourism industries.
Tenants
The tenants at Bayside remain the lifeline of the marketplace. They are a main attraction. Tenant turnover through the years is in line with what is to be expected in any retail establishment. Bucking the trend, Holly Huston of Le Bowtique and Rue Le France has been operating in Bayside since 1988. Holly opened her boutique straight out of college. She approached Bayside wanting to test her hair accessories business and was given the opportunity to start off with a pushcart. As business grew, Holly moved on to a kiosk, a store and later multiple stores. These days her business split is 70/30 between tourists and locals. As residential downtown expands, so does her local clientele base. Holly praises Bayside for being an inclusive place that cultivates growth. When asked what has kept her business going through numerous economic downfalls, social changes and a global pandemic, Holly’s response is “perseverance and love for what you do.”
Another long-lived tenant at the marketplace has been Passage to India, a casual resort retailer catering to the Miami lifestyle. Trovel Williams, the owner, came across the opportunity in a serendipitous way. While working as an FIU small business counselor, one of his clients inquired about a business plan for the new shopping center. Trovel was immediately impressed. He put his training to work, wrote the business plan, got it approved by The Rouse Company and was ready to go in time for opening day. Opening day at Bayside Marketplace was unlike anything the city had ever seen, “The crowds were so big that people had to walk around with their arms to their sides as though not to get bumped around. The energy and excitement were contagious,” recalls Mr. Williams. He also started his business with one pushcart in 1987 and now operates four stores. Trovel attributes his success to the great training and education he received at FIU. Leveraging business acumen to create a unique shopping experience within a niche market has been cornerstone to his success.
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Emilio Calleja, owner of Mambo Café, also recalls his early experiences. At that time, he was a political neophyte who had worked with James Rouse. He learned of a minority program available for marketplace tenants and decided to try his hand as a restaurateur. Emilio’s first endeavor at Bayside was Sharky’s, located on the second floor of the shopping center. Having keen business sense, he realized that foot traffic was stronger on the ground, so he moved his restaurant and concept. Voila, Mambo Café was born. When asked what has kept Mr. Calleja at the marketplace for all these years, his answer is success. His business has traditionally done well, and he is passionate about his work. He noted that his customer base has shifted from being tourist driven to more locals. His great staff, some of which have been with him for over 20 years and quality product have also been key.
Consumers
No examination of the marketplace is complete without a description of the consumer. The Miami Herald article “Bayside: Step by Step, Bite by Bite” from April 5th, 1987, details the initial expectations of foot traffic. “Bayside hopes to lure 14 million people over the course of a year. That breaks down to 3,200 people an hour. The average visitor is expected to stay 2 1/2 hours.” Bayside merchants consistently endorse the notion that the local consumer has become a bigger part of the marketplace. According to the Downtown Development Authority (DDA) the Greater Downtown population has experienced rapid growth in the past decade. In a 2010 census, the population was estimated at 40,466 and in 2020 that number grew to more than 100,000. But consumers are not only locals. They arrive from all over Miami-Dade and Broward. These Floridians flock to downtown for any event whether it is a concert or Heat game (at the FTX), fireworks, races or gatherings at Bayfront Park. They also arrive from far off domestic locals and from countries halfway around the world. The cruise and travel industry are major drivers. Per the Greater Miami Convention and Visitor Bureau data, total passenger cruise traffic jumped from 1.3 million in 2010 to 2 million in 2019. In 2006, there were only 23 hotels in downtown Miami; in 2021 that number was 47. Although demographics and consumer spending data are difficult to assess, the trends are clear. As Miami continues to grow, trickle-down effects will be felt at Bayside Marketplace. Furthermore, courting the local population is vital. It serves not only to broaden consumer diversity but may also offer a measure of protection against an economic downturn.
Small Minority-Run Businesses
It has often been said that small businesses are the backbone of the economy. The city of Miami has long realized the need to support small business owners, but not necessarily the interests of minority business owners. The McDuffie riots refocused much of this thinking. The 1980 race riots engulfed much of Miami after police officers were acquitted for beating Arthur McDuffie to death at a traffic stop. As tensions eased, it was clear that change was necessary, and rebuilding would mean better support of minorities in all aspects of life. Consistent with this renewed ethos, the city of Miami, in collaboration with Jim Rouse, created a foundation that would do just that.
Support for minority-run business has been part of the Bayside Marketplace DNA from the outset. Among the requirements the Rouse company had to satisfy in order for the city to greenlight the project, this one was non-negotiable. In 1986, Miami Bayside Foundation (MBF) was established to revitalize and serve the City of Miami’s downtown economic core. Mr. Nathan Kurland, one of the foundation chairs, recognized that though MBF was built on the honorable idea of supporting the community, it had been dormant for over two decades. Not much was accomplished in terms of active assistance, yet the foundation continued to be recognized by the City and Bayside Marketplace alike. Despite this, yearly contributions from the property owners at Bayside never wavered.
Kathleen Murphy, the current MBF Executive Director, was hired in 2010 along with a new board and team with the express purpose of breathing new life into the foundation. They dissected the past, identified community needs and set strategies with attainable goals for the future. Their certification as a Community Development Financial Institution (CDFI) has also helped the MBF realize its potential. Some recent accomplishments worth mentioning include:
· Awarded 157 loans totaling more than $8.7 million to minority businesses in Miami, helping create more than 480 jobs.
· Awarded 2,435 scholarships to minority students in the City of Miami including 198 through the Miami-Dade County Public School Scholarship Program to graduating seniors going to college.
· Created a scholarship program for technical colleges in the City of Miami which awarded $184,725 to 110 students at D.A. Dorsey, Lindsey Hopkins, and George T. Baker Technical Colleges, as well as awarding the first co-named scholarship with Baptist Health South Florida
· Gifted $2,856,000 to educational programs that work with minority children and youth in Miami, from preschool to college.
The trickle-down effects from MBF have impacted Bayside Marketplace merchants in very positive ways. The MBF was established as an extension of the marketplace and through its support over the years, it has transformed the community and the lives of people of color every step of the way. It can be counted as one of the most impactful and forward-thinking initiatives brought about by the development of Bayside Marketplace.
A Journey Ingrained in Downtown Miami History
The shopping center is currently owned by Ben Ashkenazy, a renowned real estate developer. Pam Weller, VP of Asset Management, thinks Mr. Askenazy is on the right track. She states, “Through his direction, leasing terms have changed to attract both the local and tourism component through best of class leasing in all categories”. She also highlights that there are new tenants reviving old vacant spaces and that an important modernization of the façade is underway. Margaritaville, Kuba Cabana, Bacon Bitch are all slated to be added to the tenant list in the coming months. National and local presence remain important for the Bayside retail customer and finding the right mix is essential.
The initial goals of Bayside marketplace were to both revitalize the neighborhood and create new minority businesses. After 35 years of operation, where does it stand? Regarding the revitalization of the neighborhood, the answer remains inconclusive. While it is true the shopping center brought new life to the Pier 5 area and more traffic to downtown Miami, it was never able to bridge the gap between the property and downtown. The Bayside customer doesn’t generally venture out and explore Flagler Street or support nearby businesses. This might be an indicator of superb Bayside customer engagement, or a telling factor of the underdeveloped state of downtown. With respect to the growing minority businesses, it is clearer. Today approximately 70 percent of businesses in the marketplace are minority owned, representing a significant improvement from the 49 percent found on opening day.
Competition hasn’t always been kind to the marketplace. Outflanked by South Beach, Design District, Mary Brickell Village, Brickell City Center and Wynwood, at times Bayside loses its place as a prime destination. Perhaps the most admirable trait of the marketplace is its self-awareness. Bayside has navigated decades of change by staying true to what it is and focusing on its target customer. It is fully aware of who it serves — and through natural selection in the form of retail victories and defeats, it has continuously offered its consumers the experience they expect. It is not pretentious, flashy or intimidating. It is just an inclusive space that welcomes everyone regardless of nationality, purchasing power or cool factor. It invites you to have a fruity drink, listen to some live music and enjoy the water views for as long or as little as your heart desires.
[Adapted from the book Downtown Miami History.]
Matilda Kalaveshi, MBA, is a retail strategist and Professor at Instituto Marangoni. She is also the Business Columnist at Downtown News.
