Rick Barbrick has Bloomington "in his blood." After attending IU in the early '70s, he returned to his college town in February 1997 to open Dharma Emporium, a "psychedelic museum, gift shop and fashion boutique."

Now, 10 years later, he has decided to close his store. The Kirkwood Avenue building where Dharma Emporium is located changed hands about a year ago, and since then Barbrick's rent has been hiked from $1,200 to $1,600 a month.

"I'm closing in October of next year when my lease expires," Barbrick said. "I'm just convinced my rent would go up again by a considerable amount if I renegotiated with the new landlord."

As small local stores like Dharma are forced to close or move due to rent increases, high-end retail boutiques are taking their places. New luxury student housing developments draw students with higher disposable incomes into downtown Bloomington, creating a larger market for boutiques.

According to Talisha Coppock, executive director of Downtown Bloomington, Inc. (DBI), 1,000 new apartments opened in 2004. They were all geared toward college students.

"The apartments were 100 percent occupied immediately, so you could see the demand was really there," Coppock said.

And in addition, about 800 new bedrooms could be added over the next couple of years, said Bloomington Plan Director Tom Micuda.

"These are unbuilt projects, as well as projects that are in the planning stages but have not yet obtained city approvals," he said. "And we know from talking to developers that most of these new residents are IU undergraduate and graduate students."

More than 80 new businesses have also opened downtown over the last three years.

"The housing has brought college kids and their parents to the downtown area," Coppock said, "so there was a whole new group of apparel stores created to cater to them, along with new restaurants."

High-end boutiques on the rise

Some of the new local boutiques include Bella Donna, InSeam Denim, Haley's Boutique, Lola Rue and B Boutique. Two of the most recent openings have been London Dog, a high-end dog apparel and accessories store, and Longggisland Apparel, a boutique featuring men's urban clothing from the coasts.

Brooke Magdzinski, owner of B Boutique, opened her store in August 2006 and was one of the first in the high-end market.

"I went to Indiana University, and back then there were very few boutiques," Magdzinski said. "My girlfriends and I shopped at Cha Cha and Pitaya and Urban Outfitters, but we would all have to drive to Indy to get things like designer jeans and cocktail dresses."

IU students don't have that problem today.

"I think the high-end market is about tapped out as far as women's clothing goes," Magdzinski said. "All the lines are here, and you can find designer denim in multiple places. There is a lot that can be done for upscale men's clothing, though."

It's not a coincidence that B Boutique is located between two luxury living apartments, Smallwood and the 10th and College Apartments. These apartments are among the reasons why Magdzinksi chose to locate her boutique where it is.

"The college girls that live in the apartments surrounding me can afford the lines that I carry," she said. "A large part of my market lives right above me in the 10th and College Apartments, so there is no doubt that the high-end living fuels my business."

Micuda said that, based on anecdotal information, the primarily student, upscale housing residents have higher disposable incomes than the students of his generation.

"They are driving nicer vehicles, can afford higher rents, and do more shopping than students in the past have done," he said.

Coppock said that while Bloomington is different than it was 20 years ago, a downtown is meant to be ever-changing.

And the closing of older downtown stores is certainly a change.

"I've seen small businesses come and go," Barbrick said. "These people come in with dreams, just like I did, and they couldn't last more than one or two years. Survival of the fittest is the bottom line no matter who you are."

But even with the small businesses declining and the rent increasing, Barbrick still likes Bloomington.

"I don't feel like I want to leave just because it has changed so much," Barbrick said. "Part of the charm is that it's a college town. You have all these students who make it intellectual and constantly change it."

Nicole St. Pierre can be reached at .