This post was contributed by a community member. The views expressed here are the author's own.

Health & Fitness

Is Newport Beach Recession Proof?

How does Newport Beach fare as a city? Is it more immune from the downturn and the state crisis?

If you are reading this, then welcome to my first Newport Beach Patch blog posting. As a previous reporter for the Patch covering Newport Beach you’ll now be getting on-going and regular commentary on business in general as well as specific city oriented events. If there is something you would like to address, please send me a line and I’ll do my best.

So, the question at hand; “Is Newport Beach recession proof?” As much as it seems a rhetorical and obvious question, the answer is “no.”

We live and work in one of the best locations in the county, the state, the country and even the world, but the challenges of the outside world still makes their way into our enclave.

Find out what's happening in Newport Beach-Corona Del Marwith free, real-time updates from Patch.

What does that mean for the local business owner? How are they (and you) doing? Are we feeling the slowdown? But more important; are we doing something about it?

Virtually every city in California is facing a budget crisis and moneyed cities like ours, cities like Beverly Hills are facing money issues. Per the LA Times from last year:

Find out what's happening in Newport Beach-Corona Del Marwith free, real-time updates from Patch.

“Beverly Hills' luxury retailers, five-star hotels and restaurants could previously count on well-heeled foreign visitors to see them through any serious downturns. This time, however, even the tourists are staying away, and shoppers in general are sparse.”

And that in a town with just 36,000 residents, where over 80% of their tax revenue is generated by retail sales. So a 10% drop in retail activity is huge.

We are not so heavy in that one area and have a much more varied economy, but since 2010 we have seen about a 20% decline in retail sales and even higher in hotel taxes. That ripple affect hits all aspects of our town, but we are fortunate that Newport Beach has one of the best city ratings in the state, a AAA from the Big Three ratings agencies, one of only five cities that is so blessed. Ironically, Beverly Hills is also one of them. With a strong budget reserve and an entrepreneurial city council and leadership, we are poised better than 95 percent of all the troubled cities in California.

The automobile sector is surging a bit, primarily due to the age of the average car on the road, which is now about 9½ years old according to the R.L. Polk Company, an all time high. Those drivers with gas guzzlers are surely motivated to get a more economical ride, and have accepted the fact that their vehicles are worth much less than they hoped. Here in Newport Beach our automobile market is more specialized and the average buyer of those cars are not as concerned about gas prices.

Restaurants, the biggest revenue generator in the city, at over $4.6M in revenue, have high hopes that the worst of the bad times are over. Summer is but weeks away and NOW is the time to truly understand your business and how you can reinvent yourself for these times.

We’ve removed the ability to reply as we work to make improvements. Learn more here

The views expressed in this post are the author's own. Want to post on Patch?