For any young, gutsy and artsy entrepreneur, Honolulu Chinatown is the place to start a business.

Just ask any of a handful of entrepreneurs who set up shop in Chinatown's arts district this year, despite the recession. Among them are the owners of Otto Cake, a new bakery, several fashion boutiques and the Peggy Chun art gallery.

On Bethel Street, where the former Red Elephant space sat vacant for at least a year, the new Bambu 2.0 martini and coffee bar lounge has now been open three weeks and is doing better than expected, according to longtime Chinatown entrepreneur Dave Stewart.

“;It's a great neighborhood,”; said Stewart, who started Indigo Eurasian Cuisine more than 15 years ago, followed by Brasserie Du Vin and Bar 35. “;There aren't too many neighborhoods in this city that allow small, young entrepreneurs to get a foothold.”;

This is where the artsy, creative types set up shop, next door to the Chinese jade and herbal shops, and where dreamers launch a new business to find out whether it will take flight.

This is where new ideas are tried out, whether in food, fashion, art or performance. It's edgy, funky and thriving, but there's a real sense of community here, according to those in the neighborhood.

Part of the appeal is the popular First Friday gallery art walk, which now draws up to 10,000 visitors, according to Marsha Joyner, coordinator of the Chinatown Arts District Merchants Association.

Otto, who opened up Otto Cake on Smith Street in July, says cheesecake and coffee sales on a First Friday alone take care of the rent for the month.

Otto, who sells cheesecake for $5 a slice along with coffee toddies, says rent and overhead are more affordable in Chinatown but that he also likes being near the creative energy of the arts district.

Even though he's far up on the mauka side of the street, away from the central arts district, he gets plenty of walk-by traffic from downtown workers, residents, even Japanese visitors. He's also landed Gucci as a client.

Next door, Suzanna Kuhlemann and her sister, Pia, opened etown, featuring fashions from select local designers and special collections, in August.

Kuhlemann said when they saw Otto Cake, they decided it was a good spot. It was more affordable than rent in a large shopping mall, but also a more interesting place to be.

“;I think it's the most interesting district,”; she said. “;New things are happening here in Chinatown, and we want to be part of that.”;

Smith Street, once full of vacancies, is now the place to be, according to Urban Nomad owner Frieda Hulse, who is holding a final closeout sale and moving back to New York.

Hulse recalls when she opened her vintage and designer boutique on Smith Street more than four years ago, she went into a space that had been vacant for 10 years.

No one wanted it, but she took a risk, establishing herself as a designer selling vintage apparel, accessories and wares. By luck, just two weeks after she opened, Bar 35 and Next Door opened up, drawing more traffic to the neighborhood.

“;I took a big chance because there was nothing else,”; said Hulse. “;Now 4 1/2 years later, rents are starting to rise, and everyone wants to move to Chinatown.”;

Hulse, a fashion pioneer in the neighborhood, says with First Friday established, the road has been paved for other designers moving into the neighborhood.

New entrepreneurs

The neighborhood, indeed, has spawned several generations of new entrepreneurs. Some have come and gone but many have stayed.

At 83 N. King St., the Pacific Gateway Center is a starting point for many immigrants launching their own business.

The nonprofit offers business loans, assistance in drawing up business plans, a small retail gift shop, as well as Lemongrass Cafe—a venue where startups can test out the popularity of their products with customers.

Since opening the space in March, between 20 to 30 entrepreneurs have launched new businesses, according to executive director Tin Myaing Thein. The center has helped immigrants from Vietnam, Thailand, Cambodia, Burma, the Philippines and, more recently, Micronesians.

“;Chinatown is, in many ways, becoming the in place to be,”; said Thein. “;I think if you look back five or six years, you wouldn't think First Friday would be so successful.”;

The new businesses launched from the center feature products ranging from honey to coffee, orchids and Kili bags.

Maria Tan, an Indonesian-born pianist, launched her Kombucha PepTea from the center in September.

The tea, which is made from a fungus, is said to be high in antioxidants, and is now sold at major health food stores including Kokua Market, Umeke and Down to Earth.

Tan, who began drinking Kombucha herself after a car accident, says her version is a special mix that tastes less sour and more like plum tea. The center, according to Tan, played an important role in helping her with labeling and marketing, and she was able to test it out first from Lemongrass Cafe.

Kimi Morton Chun, who opened the Peggy Chun Gallery at the Arts at Marks Garage building in April, is one of the new faces in the neighborhood bringing fresh ideas to the district.

Starting Friday, Jan. 15, the art galleries will launch Slow Art Fridays, which will offer art exhibits on the third Friday of every month for those who prefer a slower pace and less crowded atmosphere.

There's a synergy among the businesses, she said—fashion shows are being planned in art galleries, coffee shops double as art spaces, and food from local shops is being served at the events.

Land of Organica, a producer of organic juices and sorbets, set up production in the building at the corner of Maunakea Street and Nimitz Highway after signing a lease four years ago.

Today its juices and sorbets are sold at Kokua Market, Down to Earth Natural Foods, Umeke, Whole Foods Market and at Kalapawai Cafe in Kailua.

The family-run company is also at Kapiolani Community College's farmer's market every Saturday morning. Most recently, Land of Organica began selling its products to the military commissaries.

Revitalization

Owner Jeremy Daniel, 29, said the space was ideal due to its central location and that he was drawn by the revitalization going on in Chinatown.

Land of Organica sells nine flavors of juices, with its newest one being Orange Olena—all are certified organic. Prices for the juices range from $2.50 to $4, while pints of sorbet run up to $5.99.

For three years, Land of Organica had a cafe next door which participated in First Fridays, but Daniel closed it last year in order to focus on wholesale production.

On First Fridays, Land of Organica sells its juices at Live on the Lawn in front of the Hawaii State Art Museum.

Sean Priester, former executive chef at Top of Waikiki, ventured to Maunakea Street in Chinatown with Soul Patrol to launch his new lunch wagon selling Southern food just before Thanksgiving.

Though he's still scoping out a regular spot for the lunch wagon, Priester said he first went to Maunakea because he loved the diversity.

“;There's nothing like Chinatown,”; he said. “;I love the diversity and energy of First Friday.”;

He's planning to set up his lunch wagon there regularly on First Fridays.

New life is also arriving to North Hotel Street, which is now home to a new bar called Manifesto, in addition to Bar 35, Next Door and thirtyninehotel. The long-empty Club Hubba Hubba is under renovation.

Though INTO, a contemporary accessories, art and furnishings boutique at 40 N. Hotel St., is now closed, new plans for the space are already under way, according to merchants in the neighborhood.

Sandy Pohl, owner of Louis Pohl Gallery on Nuuanu Avenue, welcomes the new businesses popping up in the neighborhood. She's feeling optimistic about the Year of the Tiger, which begins in February, believing it will bring a new, entrepreneurial energy.