THE MERCANTILE: CAPITOLA SUCCESS STORY
By Camille J. Fitler, Santa Cruz Express

June 25, 1981
Fast approaching its first anniversary on July 5, the Capitola Mercantile has enjoyed a lion’s share of entrepreneurial success during its brief existence.

Located in the heart of Capitola Village, the Mercantile is the brainchild of Peter L. Dwares, a San Francisco based attorney who specializes in real estate investment. Dwares, who serves as the managing partner, is a long-time Capitola visitor and, for the past three years, has resided there part-time.

Acquiring and developing the building was no easy task. Dwares made his first attempt in 1977, but was unsuccessful. However, negotiations beginning in January of 1979 resulted in the closing of a deal in July of 1979.

One of the roadblocks to Dwares plans was the Mercantile’s rather checkered past. During its first incarnation ( in the early 1950′s), it went on to house a flea market and a number of failed retail ventures. It then stood empty for several years.

Dwares discovered that a large empty building did not encourage financial backing, but he eventually found the money and, with the approval of the Planning Commission, Coastal Commission, Arch and Site and the Capitola City Council, began renovation.
Hiring what he terms “the best retail designer,” Dwares set out to do the place like a mini-Quincy Marketplace (in Boston), with skylights, a greenhouse, canvas and high ceilings. A special guy was hired to pick out the colors of paint for the Mercantile and to execute the exterior graphics.”

Dwares feels the Mercantile is “the most unique retail center in Santa cruz County. We’re located across from the beach and surrounded by restaurants. We’re open seven days a week and weekend evenings.

“The place is cheery, an upper. The distinction between a large mall and the Mercantile is personal service – you don’t see that in department stores. These stores have charm, they’re unique and the merchandise is high quality.”

Thoroughly touring the Mercantile is at least a two hour excursion. There are 13 separate businesses housed in the one-story brown and blue building: eleven of them are retail shops, two purvey food and beverage.

Approaching the building before even entering, the eye is caught by numerous soft, squishy-looking human-like and otherwise forms gracing the windows of the first shop.

Three Wishes is owned by Jeanne Stowell, Steve Key and Marlana Barendregt. The critters up front are known as “softies.” Featuring plants, jewelry and handmade art, the three partners opened in Capitola because, according to Stowell, “We wnjoy teh area. We were all interested in starting a new business and working in Capitola.”

The softies are the work of Key and Barendregt. From their studio in Aptos, the two hand-produce the soft sculptures and other artwork is provided by various Monterey and Santa Cruz county artists.

Stowell feels, “Three Wishes provides personal service. We try to find information for people, tell them how to take care of the plants, offer special services. We’re doing very well – we’re pleases with the progress of the shop.”

Leaving Three Wishes, a few steps down and a sharp turn to the left finds one in the Celebration Gallery. The shop handles high quality hand-crafted items created by approximately 35 different artists. Celebration is operated by Jim and Nora Payne and is “a dream we’ve had for several years.” While Jim hammers and saws away to complete shelves for the expansion which success has demanded, Nora relates, “Three years ago we traveled extensively throughout the U.S. We started our plan of attack, pulling a house trailer for four months and putting together the people to buy from. We know all the artists represented here personally.”
The Payne’s believe they’ve “been able to bring in things people haven’t seen before. We bring in some of the biggest names and highest quality. With the expansion, we want to work into doing shows, on a spontaneous basis, featuring one or two artists.”
Immediately next door to the Paynes is Starboard Gifts, one of the original businesses to open in the Mercantile. According to owner Don Bourgerie, “About 80% of the merchandise is of a nautical theme. I specialize in brass and we carry a lot of different items.”

After touring the world two-and -a-half times (and visiting 23 countries), Bourgerie gave up marketing for a large corporation to “continue my love affair with Capitola.” Starboard Gifts is geared to local clientele. Bourgerie says, “A good percentage of our business is local and repeat… and tourists love the prices. I’m geared to Santa Cruz County.”

There are 21 different artists working exclusively for Bourgerie. They are from Santa Cruz County artwork – buying from the artists outright rather than taking items on consignment.

One-of-a-kind custom sea chests, ironwood carvings and concrete seagulls (known as “Quiet Gulls”) are some of Bourgerie’s favorite items. “The gulls are so popular people come from all over. I shop them to LA, Utah – I’m the only one who has them.”
The next shop is Carole Phillips’ Panache. Basically this is a good skin and body store, carrying products to treat yourself well, There’s a trend back to cosmetics – you can be a feminist and wear color,” Phillips explains.

Phillips also tries to “give people a chuckle – it’s never dull.” Devo glasses or goose quill toothpicks help liven things up.
Many of the cosmetics and bath/body products are purchased from the Body Shop in Berkeley and, because of “private labeling,” the costs are kept down. Containers are refillable or customers can bring their own – at a saving of 40 to 60 cents. There is also a make-up table for trying out new looks.

Phillips neighbor is That’s Hell of a Note. Owned by Diane Richardson and Judy Etherington, the store is managed by Peggy Chandler. The store boasts a full wall (and then some) of cards, wrapping paper and stationery by the pound. There are also gift boxes and a wide variety of stickers.

By this time, with blood sugar rater low and the smell of warm, freshly-baked cookies wafting into the Mercantile, a trip to Grandma Buffalo’s is in order. Grandma Buffalo’s Chocolate Chip Cookies (known as the edible buffalo chip) are produced from a recipe developed by Mrs. Joe Piedimonte who, along with her husband, owns the shop. There are ten different varieties, including whole wheat carob, mint chip and coco-chip-a-roon. The recipes are carefully guarded secrets – not even Grandma’s employees know for sure what make up the goods.

Supervisor Olga Torres says, “Everyone here works as a team – cooperation is a must. We’re really busy and popular.” Torres and Vicki Anderson (another supervisor) agree, “These are good cookies – we’ve tried others. People order dozens.”
And so back to browsing. Re-entering the Mercantile from San Jose Avenue, Palm Court Jewelry sits on the left. Palm Court, owned by Carin Mudgett and managed by Carol Zimmermann, primarily carries hand-crafted limited-production jewelry. Mudgett, who also owns the Craft Gallery, moved to the Mercantile to expand and to give more attention to jewelry. “We offer two things that are different: a large selection of earrings and a wide variety of wedding bands and sets,” explains Mudgett. “There’s a need for moderately-priced, unique special wedding bands – people should be able to have something left over from the honeymoon. We try to have a cross section, a good price spread.

“We have a lot of stuff in a small space. And carol really knows the lines we carry – she gives good service. She’ll call for prices, knows what there is to offer. One of the reasons for success is her familiarity with suppliers,” says Mudgett.

In the center of the Mercantile is Ellyn S. Diskin’s Blue Rose – a shop devoted to the rose. Housed in a gazebo built by a friend, the shop was started by Diskin in the back area of the Mercantile last July, using a cart and a couple of flower stands. She moved into the middle when her business outgrew the cart. Diskin makes many of the items she handles – the clay roses (used as earrings and on bracelets) and the silk flowers. She purchases flowers in Watsonville.

Along with the hand-crafted items and fresh flowers, Diskin also carries dried rose petals (“a by-product of the business”) which can be mixed with oils and spices to make inexpensive potpourris. She is also “heavily into herbs – fresh and dried. the fresh herbs come from the Capitola Community Garden. I make herbal bouquets using mint, sage, oregano. The herbs can be dried later.”
Leaving Blue Rose, one’s eye is caught by the rainbow of colors known as Spectrum. With a theme of color, Babette Beyer carries all kinds of items – both humerous and functional. There are ceramic pins in the shape of different foods, letters of the alphabet or Betty Boop, rainbow stationery, hats with ears and Aurora clocks. One of Beyer’s favorite items are “the silly hats – with ears, lightning bolts or chickens.”
From Spectrum to Harmony & Lotus is a short walk. Owned cooperatively by a number of people, Harmony & Lotus carries all natural fiber clothing: 100% cotton, raw silk, crepe de chine, cashmere and wool. They handle both men’s and women’s clothing.
The basic premise of the shop is to offer first quality merchandise at a good price. By ordering for all the Harmony & Lotus stores at one time (there are three others: in San Anselmo, Santa Rosa and Mill Valley), they are often able to offer lower prices.

Heading back through the Mercantile and turning to the right brings one to Vintage Antiques, still another of the original tenants. Owner Dennis Dubeck, manager kevin Shephard and Will French all have an interest in antiques and knowledge in varied fields.
Along with antiques, they also carry reproductions, manufactured at their own factory in San Francisco. Special amongst their inventory, according to Shephard, are “Dining room sets, brass, dressers, rolltop desks and lamps.”

Last but not least and right next door to Vintage Antiques is Delicacies, Dona and Patrick Dougherty’s delicatessen. Dona, who is from Brussels, and Patrick, who met Dona while studying cuisine if Brussels’ national Institute of Hotelery, opened this past January and offer imported cheeses, meats. beer and California wines. They are open from 10 a.m. to 6 p.m. weekdays and from 10 am to 9 p.m. on Friday and Saturday. On the weekends, Patrick also whips up fresh made-on-the-premises pastries. For $2.75 one can “create your own sandwich,” choosing a selection of meats, cheeses, breads and accouterments.

After an afternoon of shopping and browsing throughout the Mercantile, Delicacies is the perfect way to call it a day: an opportunity to sit down, rest one’s feet, have a bite to eat and people-watch in Capitola Village.