MANY SAN JOSE citizens act like they've crossed the Mason-Dixon Line when they drive 101 through South County. Crossing through the wide expanses of Coyote Valley and through Morgan Hill and Gilroy on their way to posher destinations like Monterey and Pacific Grove, most have little inclination to get off the freeway to explore one of the small cities along the way.

But those who do venture into Morgan Hill will be surprised to see a downtown on its way up. On the surface, it looks much like a Thomas Kinkade–esque rendering of a small town downtown, and the city has worked hard to make it that way: brick-laid sidewalks, tree-lined meridians, large flower planters and old-timey light posts abound.

Come to downtown Morgan Hill on a Friday night, and the place is jumping, the sidewalks busy with people enjoying live music and the eclectic dining scene that has slowly been gaining momentum. It's the type of place where you can walk into a restaurant and see council people, schoolteachers and local business leaders all grabbing a bite to eat.

But Mayberry it is not. With a population of more than 39,000, Morgan Hill has visions of a sparkling, thriving downtown similar to Los Gatos. Businesses want to attract not only townspeople but also day and evening trippers with deep pockets from all around the Bay Area. After a history of false starts and failed efforts, the city of Morgan Hill is finally reaching for the next level.

Ghost Town

It was back in the 1980s that the Morgan Hill City Council first started taking about revitalizing downtown. With Highway 101 drawing more and more townies up to San Jose and down to Gilroy to shop and dine, downtown Morgan Hill was on the skids. The Granada movie theater, once the biggest draw in town and still one of the most recognizable symbols of Morgan Hill, was becoming dilapidated, and many of the streets and buildings were sitting empty and falling into disrepair.

Morgan Hill City Councilmember Greg Sellers grew up in Morgan Hill, and moved back to the city in the early '90s to become director of the Morgan Hill Downtown Revitalization Program, the predecessor to the Morgan Hill Downtown Association. Though the city continued to pump money into downtown for a number of years, Sellers says it lacked the commitment and long-term sustainable outlook to make downtown really work.

"In the past, I think that there was more of a reliance on the private sector and trying to set the table for that," he says. "It was difficult. Everybody kind of just sat around the table just waiting for everybody else to take the first bite."

Even with the formation of the official Morgan Hill Downtown Association in 2002, things were slow to take off. Established and funded by the city to promote economic growth and serve as a voice of downtown, the Downtown Association worked to improve the area's image.

Jorge A. Briones II, executive director of the Morgan Hill Downtown Association since September of 2007, agrees that for many years the Morgan Hill City Council was a lot of talk but not a lot of action when it came to downtown.

"City Hall in one way shape or form repeatedly said 'Downtown's important, downtown's important' ... but nothing ever happened," says Briones.

Political Shift

A decision made by the Morgan Hill City Council last winter shifted the prognosis for downtown's recovery. In December of 2007, the city officially purchased a large parcel of downtown property between First and Second streets. In one of the biggest real estate deals in the history of the city, the block of land the city purchased for $10.6 million included the Granada Theater, the Downtown Mall and a large parking lot.

"There was a lot leading up to that, but that was a huge turning point, the City Council stepping up and saying, downtown is truly important to us, and here's how important it is. We just wrote some really big, million-dollar checks. It was very important," says Briones.

Not only did the city of Morgan Hill buy a significant part of downtown, but they also launched into a five-year revitalization plan to make what Mayor Steve Tate is now calling "our spectacular downtown" come to fruition.

The ambitious Morgan Hill Downtown Specific Plan includes numerous redevelopment improvements and extensive building. At the top of the list is the hiring of a master developer by the city by the spring of 2009. Once the master developer is secured, they will regulate the extent of redevelopment on Granada Theater, along with conducting a totally rebuild of the area where the Downtown Mall now sits. The hope is to turn it into a mixed-use structure for retail, housing and office space.

Also impacting the future of downtown is the Third Street Promenade Project, the building of a pedestrian mall and entertainment plaza that will connect downtown with the train station and the future courthouse on Butterfield Boulevard and Diana Avenue.

"The city has proven that they made a huge financial commitment that involves actually doing things," said Sellers. "We've acquired more property downtown then ever before in the last few months. So pulling these projects together and making them happen I think is making a strong statement of our long term commitment."

The Rainmaker

A key component in the future of downtown lies in the hands of the Downtown Association and its executive director Briones. After being put in charge of the Downtown Association in September 2007, he immediately launched into advocating and promoting the downtown.

With the help of part-time events administrator Danielle J. Boulger, in the last year Briones has done everything from establishing marketing programs to organizing events like the Downtown Street Fair Series to screwing in new light bulbs at the Granada.

One of the first things that Briones did to help rehab downtown's image was clean up and relight the noticeably decaying Granada Theater, which had been vacant since 2003.

"Basically, it was shuttered. It was closed up. You could look in the windows but the lights were off, the neon didn't come on. It was just this dark space."

After cleaning up the theater's front foyer area and conducting some minor repairs, Briones got the neon sign working on a nightly basis, and started posting information on upcoming downtown events on the marquee and in the movie poster cases.

"One of the things that we did was try to make it more friendly and more inviting because, in my eyes, it was a landmark of downtown. It's been here since 1952 in its current location."

Though the result is a visible improvement, the Granada Theater, like much of downtown, is still closed, empty and in need of TLC.

"We've had more retail vacancies then we've had in quite a while. But the silver lining to that is that there is an opportunity as we start seeing the housing that really needs to be put in place," says Sellers. "I think the elements are there, it's going to still be a lot of work to do, but I'm excited with the direction we are headed right now."

Because the Downtown Association is currently entirely funded by the City Council, Briones had to gain the trust of both the city and the downtown community when he came on board.

"If we would have gone six or eight months ago to the city and said, 'We'd like to do this,' they may have been more in a position to say, 'Well, why don't you come back with more information," says Briones.

"In a lot of ways, it's come down to the fact that we've gained their trust, we've built the confidence," he says. "They look at us now and say, 'These are people we need to be working with,' as opposed to 'Eh, well, we'll think about it.' That has a lot to do with [the fact] that we have been proving ourselves. I think that the community and the council both have been starving for this to happen."

Getting Cultured

One of the Downtown Association's biggest successes has been as the organization of new downtown events. Though the Morgan Hill Friday Night Music Series, now on its 16th year, is one of the mainstays of downtown happenings, it's the recent additions to the event lineup that have gotten people excited.

The upcoming Downtown Association–organized "September Saturdays" events will feature outdoor music under the sun, and movies under the stars. They will all be free of charge at the Morgan Hill Community and Cultural Center amphitheater, located at the southern end of downtown. Briones hopes to make free movie nights—which take place on Sept. 6, 13 and 20—a regular event in downtown.

A big factor in why Briones has been promoting events so fervently downtown has been to get awareness of the quality downtown restaurants that Morgan Hill has to offer.

Sellers, who is a regular on the downtown food scene, said that all he has to do is compare the quality of downtown restaurants to other parts of town to see why people seek them out.

"What distinguishes them is that they're the nicest restaurants not only in Morgan Hill but in the region," says Sellers. "I think that the restaurants in downtown, they're as nice as anything you'd find in Gilroy, or south San Jose, or other parts you could drive to, and that attracts a different demographic. "

Many in the downtown Morgan Hill dining scene are counting on this more upscale breed of Morgan Hill shopper and diner. Many in the community are already catering to more expensive tastes, albeit with a distinctly personal small-town touch.

"Will it be a little bit more upscale? I think so," says Briones. "It's hard not to look at Los Gatos and Santana Row and downtown Palo Alto and Los Altos without saying we want to be that. ... It's the place to see and be scene, and that is absolutely what the city of Morgan Hill wants the downtown to be."

Social Fabric

At the same time, downtown Morgan Hill restaurants and businesses have been able to establish and maintain a surprisingly old-fashioned small-town support system seldom seen in today's tough financial times. An example of this can be seen in the relationship between the main seafood offerings downtown, Poppy's and Rosy's at the Beach. Located just across the street from each other, traditional competition would dictate that these two eateries would be at each other's throats.

Turns out that not only are Poppy's owners the Castelans (see sidebar) and Rosy's at the Beach owners Rosy and Rich Bergin on speaking terms, they are friends that keep in touch and help each other out whenever the need arises. Case in point: when the Castelans take a long overdue vacation to Key West to attend a Parrot Head gathering this fall, instead of letting their profits dwindle, Rich Bergin will personally be running Poppy's while they are gone. Such is the family spirit of downtown.

"Are they in competition with one another? To a certain degree, yeah, but it's a lot of friends, and it truly is a lot of family. The people look out for one another and care for one another. They want each other to be successful because they all understand and believe that success breeds success," says Briones.

The New Swank

A good indicator of Morgan Hill's changing dining landscape can be seen at the Reserve Wine Bar & Merchants. Franz and Jennifer Ingram, whose family also owns the famous Trail Dust BBQ across the street, opened the wine bar a little over a year ago.

"Morgan Hill needed something else, and a wine bar was kind of what Morgan Hill needed, an upscale, casual environment to come in and have a nice drink," says Franz Ingram.

Located in an old bank building, the Reserve is dimly lit, its décor spare but classy, with bits of subtle gold-painted details. A large safe from the building's bank days has been polished up and is now used as a small cellar for their large selection of retail wines. Franz Ingram, a wine enthusiast even before he opened the Reserve, personally selects the flights, which consist of three different half-glass pairings meant to contrast.

"You want to push people's experience when they taste wine. When we put together a flight, we try to have not everything the same. Like, you don't want three superbuttery chardonnays. It's constantly changing and evolving," says Ingram.

Being vinously focused, the Reserve offers wine tasting on Tuesdays that are attended by a few of their local winemakers, and they have jazz and live music every Saturday, which usually draw a large crowd.

On weekday evenings, the wine bar is often half-full of people unwinding after a long day at work: groups of casually dressed older women with designer purses chat at the booths, and regulars in pressed button-downs and Italian loafers sit at the bar. An indication of the clientele can be seen in the small parking lot out back, where you can see BMWs parked next to Mercedes Benzes parked next to the occasional flashy Lamborghini.

With the way things are going in Morgan Hill, these types may just be the future of the downtown economy: loaded, but chill.

Briones says that while Morgan Hill is a more affluent community, people aren't in-your-face about it.

"In Monte Serrano and even Los Gatos and Saratoga, there's a bit on an air of 'You have to be a certain thing to be here and be excepted.' You don't necessarily feel that in Morgan Hill," he says.

"The people who live in the great big mansions up in the [Morgan Hill] hills, I don't think there's as many of them that want to flaunt it and say, 'Look how rich I am.' They tend to be a little more grounded. You'd never know by looking at them or seeing or talking to them, because they are the most down-to-earth people."

Five-Year Plan

Though Briones admits that the city of Morgan Hill and the Downtown Association have set up an extremely ambitious time frame for development within the next five years, he believes that it is entirely obtainable as long as they stay on track.

"Every one of us wants to just flip that switch and wake up tomorrow morning and you've got this awesome, vibrant thriving downtown," he says. "I've reminded people more times then I can count that Los Gatos wasn't always what you see, that it took 10, 15 years for it to get to where it's been for the last decade. Right now we are shaping what downtown is going to be."

What's coming back to Morgan Hill, he says, is a sense of pride. "People want to be proud of where they're from, and when you can look to the heart of your community and say, 'Man, that's a really cool place to be, let's just go down there because there's always something happening,' then that says a lot."

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