Optimistic Retailers Breathing New Life Into Mexico City’s Rodeo Drive : Tourism: Suburban malls had hurt the Zona Rosa. With government money short, merchants decided on a self-help effort to rejuvenate it.

This Christmas season, city officials and merchants are working together to polish away the tarnish that has settled on the Zona Rosa, the city’s fashionable shopping and cafe district.

Poinsettias bloom from recently finished flower beds on the main pedestrian thoroughfare, Calle Genova, where 60,000 people pass daily. Donated sculptures are being installed. Restaurateurs have received long-delayed permits for outdoor cafes. Retailers are sprucing up their building facades and expanding.

Just this Thursday, Mexico City dedicated the Zona Rosa urban renewal project, amid optimism that new life can be breathed into the Pink Zone, for years Mexico City’s equivalent of Beverly Hills’ Rodeo Drive or New York’s Fifth Avenue.

“This kind of mutual effort also could work in other parts of the city,” said Jorge Castro, president of the Zona Rosa Merchants Assn.

During an interview in his office above Konditori, his Danish restaurant, Castro spoke excitedly about the year of negotiations and work that went into the improvements.

“The Zona Rosa had become rundown and needed major maintenance,” he said. “But in the economic crisis, the government had other priorities. What little money there was had to be spent on public housing, for example.”

So the merchants decided that fixing up the common areas would be an investment--an attempt to halt what city residents say has been two decades of deterioration. They spent $30,000 on building materials, while the city contributed the workers and machinery to get the job done.

The Zona Rosa is a 20-block district that radiates from the intersection of the city’s two main boulevards, Paseo de la Reforma and Avenida Insurgentes.

Until World War II, it was a fashionable residential area. Then, the houses along streets named for European cities were gradually converted to boutiques, art galleries and restaurants that served German, Spanish or Italian cuisine.

During his student days in the 1960s, recalls economist Rogelio Ramirez de la O, the Zona Rosa was the place for the elite to gather on weekend afternoons.

“Mexico City has always been a city of neighborhoods,” he said during a walk in the district down Calle Belgrado. “This was a place to meet people from outside your neighborhood.”

Then, in 1969, a major subway stop was built on the edge of the Zona Rosa, surrounded by a mini-mall of discount stores and taco stands that clashed with the designer shops and European restaurants. The district began to lose its allure.

The oil boom of the 1970s brought U.S.-style shopping malls to the upper-class suburbs. The elite no longer needed to shop in the Zona Rosa as the areas’s boutiques, restaurants and even hair-styling salons opened branches in their neighborhoods.

The artists and writers who had lived in apartments above the shops and cafes, contributing to the area’s bohemian air, began to move out after the earthquake of 1985 devastated surrounding neighborhoods and left them feeling insecure.

And then, during the prolonged economic crisis of the 1980s, the line of card-table stands displaying street vendors’ merchandise gradually grew from the subway stop toward the Zona Rosa. More beggars and fortune tellers circulated among the outdoor diners. Tourists told stories of being robbed at knifepoint.

“There were days when we had to close the door because there were fights in the street outside,” recalled Carlos Kleiman, owner of La Gondola, an Italian restaurant in the area.

Longstanding establishments, such as La Pergola restaurant, moved to less-troubled neighborhoods near the city’s famed Chapultepec Park.

“That was really a loss,” said Kleiman. “The better places there are, the more likely people are to think of the Zona Rosa as a place to eat. They are not going to eat at the same restaurant every day.”

The Zona Rosa clearly was in trouble.

However, a new metropolitan land-use plan that restricted hotel construction in other parts of the city focused attention on the need to revive the flagging tourism zone. Forbidden from building in other areas, hoteliers took a new look and began announcing plans for buildings in areas near the Zona Rosa, promising an influx of affluent customers.

At the same time, a group of young entrepreneurs began buying the old Zona Rosa restaurants and shops, bringing a new enthusiasm for improving the area.

The merchants association found the city’s new mayor more willing to work with them, said Castro. A change in Mexican franchise laws brought the area an infusion of U.S. fast-food restaurants, considered trendy in Mexico. That has helped too.

The recent face lift undertaken by the new generation of Zona Rosa merchants has generated some controversy, however, particularly over stepped-up security, which merchants demanded.

Besides adding more unarmed tourism officers, who offer directions and advice in a variety of languages, the police have begun a crackdown on cabarets that do not fit the image city officials want for the area.

Some patrons complain that officials have been exceptionally eager in recent weeks to close down gay bars. They consider that particularly unfair, because the gay community has helped sustain the Zona Rosa during the lean years.

Merchants counter that the bars that were closed in recent weeks had brought in rowdy groups that drove away other customers.

In any event, this week’s ceremony is only the beginning of an uphill battle. The city’s resources still are limited, and Mexico’s elite still can shop and eat in suburban malls, far from urban problems.

The Zona Rosa merchants, however, are optimistic for the first time in years. Roofed malls cannot replicate the open-air atmosphere and tradition of the urban district, they say.

“The sculpture walkway will become a cultural place where school groups visit,” Castro predicted.

Not that merchants have any choice but to do all they can to revive the area, Kleiman acknowledges.

“We have to bring ourselves back up to international levels of service and products,” he said. “There is a lot of competition in the world. We have to go after the customer.”