By  on December 24, 2008

LOS ANGELES — Tracey Ross, the pioneering boutique owner who’s been a fixture here for almost two decades, is closing her namesake store on New Year’s Eve because of fallout from the recession.

Ross first opened her shop, on now-trendy Robertson Boulevard, in 1990 before moving to the Sunset Plaza district in West Hollywood in 1996, where her iconic, 1,600-square-foot boutique has drawn a dedicated following from celebrities such as Kate Hudson and Courtney Love.

“Of course it’s the economy,” Ross said in explaining her decision. “I’m very proud of what I’ve done here, but I’m just over it right now. After 18 years, you know when it’s time to exit gracefully and with dignity.”

Larger chains that do a higher volume of business are offering steep discounts, putting specialty boutiques like Tracey Ross at serious risk.

“When wealthy customers who can afford to pay retail are getting 80 percent off at Saks or demanding discounts…it makes it impossible for smaller boutiques to compete,” Ross said. “I don’t need to be a showroom, and that’s what I was becoming.”

The boutique carries lines such as Hysteric Glamour, Derek Lam, Thakoon, Stella McCartney and Jenni Kayne.

“This is a very sad day in Los Angeles,” clothing designer John Eshaya said of Ross’ decision to shut down. “It’s heartbreaking to see someone who’s been such a fixture here close her doors. These are awful times.”

California has been particularly hard hit by the economic downturn. Unemployment is rising as home prices continue to decline. Credit is almost nonexistent, consumer confidence is low and the state government is in danger of running out of money as the budget deficit balloons to more than $40 billion in the current and next fiscal year. All of this has squeezed the retail landscape.

The casualties have mounted with the bankruptcy and liquidation of a major California-based midtier chain, Mervyns, and the closure of about 160 Pacific Sunwear concept stores, as well as high-end boutiques like Sergio Rossi on Melrose Place, Robert Clergie, agnès b., Ghost and Horn on Robertson Boulevard.

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