It has existed through times of protest and peace, but now the legendary Telegraph Avenue is enduring yet another historic turmoil.

During what economists are calling one of the biggest economic recessions since the Great Depression, businesses in the historic neighborhood have been hit by sluggish sales in the past year, but a number of factors, including heavy foot traffic and close proximity to the campus, are helping lessen the blow.

Many Telegraph businesses remain open, while others including cereal bistro Moo...licious have shut down, said Roland Peterson, executive director of the Telegraph Improvement District.

"I'm sure there will be some causalities on Telegraph, but I'm hoping that there are some strong businesses, that they hang in there," he said.

John Shaghasi, co-owner of Royalty Couture, estimated that his holiday sales were down 70 to 80 percent. Customers are buying less expensive items or are not even coming in at all, he said.

"When (people) come in, you can hear them (say) that they have a limit (on what they can spend)," he said.

He is straying from stocking more expensive items and is considering selling merchandise online.

Despite slow sales, storefront clean-up and increased police presence as part of Berkeley Mayor Tom Bates' 2006 Telegraph Avenue Economic Development Assistance Package have helped Telegraph businesses.

"If it hadn't happened, things would be worse than they are now," Peterson said. In 2006, Telegraph had a high vacancy rate of 12 percent. Now, Peterson estimates it to be 7 or 8 percent.

"Telegraph is definitely not at its lowest point as I've seen it, but it is certainly down from its high point," he said. The vacancy rate was 6 percent at the beginning of 2008.

More people are returning to Telegraph to shop than before, said Doris Moskowitz, owner of Moe's Books.

"There has been times that being on Telegraph was horrible," she said. "At times it can feel like being handcuffed to a heroin addict."

Moskowitz said despite a few sour sales months last year, her holiday sales were on par with 2007's holiday season, when sales were up 20 percent.

The close location of Telegraph to the campus and its heavy foot traffic also helps business withstand economic slumps, said Ted Garrett, CEO of the Berkeley Chamber of Commerce.

"Telegraph's proximity to the university is probably one of its greatest strengths," he said. "You see most of the students venturing (there) are not necessarily going north to north Shattuck (Avenue) or west Berkeley. "

Students are a significant part of the customer base for many businesses on Telegraph, but with more students relying on financial aid, sales may be hurt on the avenue, he said.

Jerry Harris, owner of 510 Skateboarding and shoe shop Bows and Arrows, has seen weak clothing sales, but shoes and skateboard parts have made up for the downturn in sales.

"Stuff will have to get really bad for a skateboarder to pass on the stuff he needs," he said. However, he is expecting sales to drop once less economically aware students feel the pinch.

"For the most part, I just try to keep my orders lighter and my stock lower," he said.

Despite the economy, new businesses continue to open on Telegraph.

Peter Mesbah, owner of the Milanese Caffe that opened on Telegraph on Friday, Jan. 16, is confident his restaurant will fare well because it follows Telegraph's model of cheap and fresh food.

"A good businessman makes money during the downturn," he said. "There's opportunity. Some people make money during a downturn, some lose their shirt ... the economy works both ways."

Tags: ECONOMY, MOE'S BOOKS, TELEGRAPH AVENUE