White and blue balloons decorated Whitney Avenue Tuesday, as city and University officials welcomed two of downtown New Haven’s newest merchants, heralding the continued revitalization of the Audubon Arts and Retail District.

Katahdin Furniture and Yarn LLC celebrated their grand openings with ribbon-cutting ceremonies outside their new locations, developed by Yale University Properties.

Matthew Whiting and Norman Sillicker, the co-owners of Katahdin Furniture who have lived in New Haven for the better part of the last 30 years, said moving their business from West Haven to downtown New Haven was an obvious choice.

“A lot of our customers live here,” Sillicker said. “It’s a prime focus for our client base in New Haven. We’d certainly like other businesses to say that this is a place where they can come.”

Linda Colman, co-owner of Yarn LLC, said she sees the two store openings as fundamental to the on-going renewal of the downtown district.

“New Haven never used to be a destination, but people were pulled in by restaurants, and then stores and shops,” she said. “Now there’s always something happening. It’s a city with so much going on.”

Other merchants in the community were also eager to greet the new businesses. The owners of Gourmet Heaven 2 on Whitney Avenue came to Yarn LLC bearing a small potted bamboo plant for good luck and a neighborly welcome.

Colman’s co-owner, Toni Kayser Weiner, said their store further encourages the local economy by featuring a collection of yarn spun from the wool of Connecticut farm-raised sheep. Yarn LLC, which has another location in Westville, will also sponsor knitting groups, classes and ongoing workshops for interested students and community residents.

Whiting and Sillicker said they credit the University’s emphasis on retail with much of the economic revival that the city has seen in recent years.

“Yale has tied the threads together on how small retail does business in an urban environment,” Sillicker said. “They’ve specialized in building a collection of small businesses that are so different and unique. Very few organizations that I’ve heard of concentrate on building up small businesses the way Yale does.”

In his comments at the ceremonies, Vice President of New Haven and State Affairs Bruce Alexander said these relocations indicate a reversal of past trends concerning retail locations.

“Stories used to be that retail moved out of downtown and to the suburbs,” Alexander said. “New Haven is now a city on the move.”

Yale University Properties director David Newton said he sees this influx of small businesses as a testament to the renewed vitality of the downtown New Haven area specifically.

“That a store located in the suburbs chose to come downtown says a lot about the vibrancy of this district,” Newton said.

He also said plans for a new credit union across the street are a further indication of Yale’s success in bringing new business into the area.