Thursday, April 26, 2007

The Chaining-Up of Columbia Heights

DCUSAsite.jpg, originally uploaded by whiteknuckled.

While I participate in the Columbia Heights forum run by the same people, I usually don't pay much attention to what's posted on the front page. I've missed a few good things on there, and it's problematic that there's a lot of discussion that goes on under each posted item there, without being integrated into the CH forum. That's probably why days will pass sometimes without a single new post on the forum...Anyway, I digress.

I noticed that more of the tenants have been finalized, including the absence (for the time being) of a Trader Joe's or Whole Foods, which were highly hoped for by the leasing agents. I don't want to stir up the grocery store hornets nest, so I'll just say that having a Ross instead of another grocery store isn't the end of the world. (Although I would love Trader Joe's—cheap, delicious, fills a niche that Giant and the local markets don't)

The bigger concern is that all of the confirmed tenants right now are all chains, as best as I can tell. In reference to the heated discussion of Whole Foods vs. Trader Joe's vs. Ross, I noticed this one post by Shaw resident Chris L who hits the nail on the head:

I live closer to downtown in Shaw, and hadn't really been keeping track of the status of DC USA. I have to say after reading this, the tenents so far really suck. Its an injection of suburban big-box stores right into the heart of DC.

While in other parts of the city they're struggling for more local retailers vs. national chains, you guys have completely accepting that you are getting national chains and are simply fighting for less shitty ones.

I'm not trying to rub your noses in it, but definitely try to take a lesson to the next project. Get involved and get involved early!

Ouch. I hate to say that he's right but the leasing business for DCUSA is less than transparent, even though the project received DC money and land to make the project work. The problem with injecting massive new construction and hoping for independent retail is one that Richard at Rebuilding Space writes about all the time. The rents are just too freaking expensive for most independent retailers to manage:

...The rule of thumb from the Main Street Approach is that a retail business pays 4%-10% of its annual revenues in rent (restaurants can and do pay slightly more). Figure it out backwards from what businesses can reasonably generate in revenues... yet the asking price for commercial buildings, asking prices for rent, and often the property tax assessments are completely out of whack compared to the revenue stream that successful businesses are likely to be able to generate.

To me, the issue is much more how we enculture and enable small business DNA into our residents and encourage entreprenurial ability. The only way that small business or most independent retailers were going to be able to afford the rents in this buliding would be for more subsidies from DC government. (which I don't necessarily think would have been a bad idea).

To me, they should have a policy like inclusionary zoning for businesses when the developer receives massive tax or land benefits from the city: I don't have a problem with chain stores in general, and I won't mind having a Target and Best Buy in the neighborhood for convenience sake, but 15% of the space should be heavily subsidized and filled with independent retail—ideally owned by people who have been brought through a city biz incubator program.

This is the reason why preservation and old buildings are important to the balance of a neighborhood. CH Coffee a few blocks away could likely never afford to rent space in DCUSA, but they can take an under-utlilized space a few blocks away in an older building.

Older buildings = lower rents, greater likelihood of independent biz.

Floors two and three can be seen below. Comments coming later...

DCUSA floor3.jpg, originally uploaded by whiteknuckled.

DCUSA floor2.jpg, originally uploaded by whiteknuckled.