WHAT DOES IT take to turn a grim, left- for-dead downtown strip into a bustling, "upscale" magnet for shoppers? You don't have to be a 32-degree urbanologist to conclude that good stores beget good shoppers. But how does a city beget those good stores? It comes up with what the experts call "economic incentives." Translation: good deals for big-name retailers. The idea is to get one to move in and start the commercial ball rolling for other ventures. The operative words are money and space -- and the costs to the city and/or developer are considered a price of wooing business.

Right now, local eyes are on the city's courtship of Bloomingdale's, which the local government and presumably all sorts of would-be shoppers would like to see open a three-story store as part of a retail and office complex on the block bounded by F, G, 12th and 13th streets NW, above the Metro Center subway station. Negotiations -- still in the preliminary stage -- center on what combination of money and space might be enough of an attraction to link developers with Bloomingdale's on this site. Though figures are anything but firm, developer Nathan Landow has said the arrangement calls for the city to give him and the developer John Akridge the right to build an extra 110,000 square feet of retail and office space on the block. With that for the developers, Mr. Landow said, he could offer a payment of at least $2.5 million to Bloomingdale's to move in.

In the past, authorities have said, Bloomingdale's has sought a $6 million payment, but the developers say that store officials seemed "flexible" in a recent meeting. If a reasonable agreement along these lines can be struck, it could benefit all parties. The developers, with their space, could provide for 40 to 50 smaller retail shops with an entrance directly into the Metro Center station as well as a 700,000-square-foot office building and a two-floor garage.

For Bloomingdale's, the payment would be much like discounts on footage rates or other special rates commonly offered to major stores to be the "anchors" of shopping centers and malls. For the city, the complex would complement other impressive revitalization in this neighborhood, including a new Hecht's store and renovated Woodward & Lothrop and Garfinckel's stores along with The Shops, a large mall recently completed at National Place. All of these are generating jobs, shoppers and sales, which convert into revenues from property and sales taxes.

Better yet, there can be a good magnet effect -- other large stores may decide to go for a piece of the downtown action. Greed or unchecked zeal in the pursuit of an agreement could run the price too high and make the arrangemenunacceptable. But the negotiations are worth pursuing because the results could make a significant contribution to the books and looks of Washington.