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Tuesday, February 9, 2010
Report: J-K-L focus must be residents
by Suzanne Hurt, published on November 18, 2009 at 9:44PM
Storyline: K Street Mall
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If you build it, they will come.
What's been said about baseball diamonds in Iowa is now being said for downtown Sacramento's future retail market, according to a retail consultancy firm that has just finished a study of the J-K-L corridor.
In this case, "they" represent 72 percent of the greater Sacramento area's 1.65 million population: "urban chic" Sacramentans who own homes in the central city; young, child-free metrorenters; "in style" suburbanites who love the gritty city; long-time residents and new homeowners living just outside the core; and connoisseurs who want the best of everything, said Scott Schuler with Downtown Works of Washington, D.C.
"You have got to draw people from the entire market. The number of people downtown is not enough," Schuler said Wednesday when the firm presented a draft report to the Downtown Sacramento Partnership board, Mayor Kevin Johnson and city employees. The figure is based on demographic and lifestyle data other companies have produced for Sacramento.
The news that Sacramento's historic retail core could thrive once more by catering to residents throughout the region was a surprise to those who have long thought the area should be developed to attract travelers and the most wealthy residents.
"That is enough to support downtown if we have the right kind of market," said DSP Chair Kipp Blewett. "The future of downtown is going to be in the renaissance of the urban core."
While visitors remain important to the economy, they spend much more on food and beverages than retail. In addition, visitors want to experience the real city, Schuler said.
"They want to go where residents go," he said. "You don't market to them."
The city has focused strongly on bringing more nightlife and entertainment to K Street Mall. But the area needs at least as many, and possibly more, day-time uses, said Midge McCauley, also with Downtown Works, which prepared the report for the DSP and the city.
Downtown Works studied groundfloor spaces on J, K and L streets between 7th and 12th streets, and on the sidestreets of 9th to 11th streets in that area. About 18,000 people live downtown in 700 single-residency occupancy hotels and 220 market-rate housing units. The area includes 700 single-residency occupancy units and 220 market-rate housing units. About 18,000 people are estimated to live within a one-mile radius of 9th and J streets — a number the consultants pointed out as too low to support retail in the J-K-L corridor. About 93,000 people work downtown, she said.
Out of 231 total spaces, 57, or 25 percent, are vacant. Many current storefronts are "shabby" and "dated." Sandwich board signs and dead plants, replaced with new landscaping only recently, pull the area down, McCauley said. Obstructed sight lines are another problem, said McCauley, who recommended removing ticket vending machines and ramps
Only 10 percent of the 174 that are occupied are dedicated to selling retail goods. And out of 103 retail spaces that house restaurants, clubs or shops selling goods, Downtown Works identified only 12 percent as desirable enough to keep, she said.
Quality retailers have unique, attractive storefronts with distinctive, eye-level signs and appealing window displays, good merchandise that is well organized and a clean, well-maintained store.
The proposed solution: hire a "retail recruiter" whose job is to find urban pioneers — innovative retail entrepreneurs from near and far willing to open up shop in the city's risky downtown retail corridor. Arm the recruiter with the latest data on available property and financial incentives to lure retailers who agree with the vision to revitalize the area, McCauley said.
Undesirable tenants could be phased out as their contracts come up. The retail mix needs much more variety, such as apparel, outdoor goods, shoes, accessories and home furnishings. The mix should be unique — not something already offered in shopping malls. Independent stores should be focused on first, and chains that aren't overly represented in the market should be considered later, she said.
They recommend allowing cars on the entire K Street Mall, rather than a one- or two-block pilot which people are unlikely to use. The firm also recommends lower-level planters over trees, which they said block sight lines, tear up sidewalks and obstruct signs.
"People love their trees but trees are a retailer's nightmare," McCauley said.
Programs could be developed to offer facade grants and forgiveable loans for businesses that remain for at least five years, with 20 percent of the loans forgiven each year. Downtown Works recommended the first three to five pioneers get loans of $300,000 to $500,000. Other new businesses that fit the vision might get $20,000 to $100,000, McCauley said.
"We know those early deals are often the hardest ones to make," said McCauley, adding that the first deal would take a year to a year and a half if a recruiter began work today.
The DSP board members now must agree on whether to support the recommendations and then vote on formal adoption in December. Blewett said it was too early to discuss funding sources for such programs. However, if the city were to provide $1 to $2 million from the general fund, that could generate much more tax revenue for the city, he said.
Blewett pointed to Sean Kohmescher, who owns Temple coffee and teahouse on 10th Street, as the type of urban pioneer the corridor needs more of.
"He's young. He's entrepreneurial. He's committed to downtown," Blewett said. "Look what he did with a lot of elbow grease and some guts."
Suzanne Hurt is a staff reporter for The Sacramento Press.
Editor's Note: The Sacramento Press editorial department corrected a fact in the above article after the article was published. The original sentence is denoted with strike-through text, with the new sentence proceeding it.
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There are about 10 SRO hotels downtown. I think you might mean 700 SRO hotel RESIDENTS total (the current figure is probably lower than that right now) not 700 hotels...that plus 220 market-rate housing units equals 970. Does that 220 market-rate housing units include the 800 J project, the CADA and senior apartments along I and J Street, the El Cortez apartments on 11th and K? Does it include properties that are held by the city in a vacant state, like the Bel-Vue Apartments or the Berry Hotel, or residential rental properties left vacant by the owners' inaction like the Wendell on J and 12th? And where does figure of 18,000 come from? It is far too high to represent the people in the roughly 1000 housing units adjacent to K Street, but too low to represent the population of the entire central city. Where did you get those numbers?
"Only 10 percent of the 174 that are occupied are dedicated to selling retail goods. And out of 103 retail spaces that house restaurants, clubs or shops selling goods, Downtown Works identified only 12 percent as desirable enough to keep, she said."
What criteria do they use for desirability? Do they seriously think that only a dozen of the 103 businesses on K Street are worth keeping? I can name more than that off the top of my head. It sounds like they consider anything that's not appealing to the particular high-end demographic (one that largely doesn't exist in the Sacramento region) "not worth keeping" even if there are people (like, say, the non-wealthy) that patronize those businesses.
"Undesirable tenants could be phased out as their contracts come up. The retail mix needs much more variety, such as apparel, outdoor goods, shoes, accessories and home furnishings. The mix should be unique — not something already offered in shopping malls. Independent stores should be focused on first, and chains that aren't overly represented in the market should be considered later, she said."
Last time I was in a mall, they sold stuff like apparel, outdoor goods, shoes, accessories and home furnishings. In other words, she is suggesting that K Street sell EXACTLY THE SAME STUFF THAT PEOPLE CAN BUY NOW IN A SUBURBAN SHOPPING MALL. In other words, she's suggesting a mall, but that we call it something different in order to try to convince people it isn't a mall.
I suppose that the independent business thing is nice, but I'm also willing to bet that a lot of the tenants on K Street that she considers undesirable are independent businesses that don't meet her standards.
We already tried building it--in the 1970s with the original mall, and in the 1990s with Downtown Plaza. PEOPLE DID NOT COME. This report sounds basically like a green light to demolish and re-build K Street AGAIN and expect a different result. These people are true believers in the Skyscraper Fairy, and they will sacrifice all that is worth saving about K Street (what little is left) at her mighty altar.
While you are correct, the housing count (770/220) are units, not buildings or residents. It includes all of the residential units in the target area (JKL, 7th to 12th) so ‘yes’ on the Cortez and 800J, ‘no’ on the vacant Bel-vue, but ‘yes’ on Berry as there is every intent of having that remain a low-income residence. The 18,000 residents are within 1 mile radius of Downtown (9th & J).
In regards to the 12% 'desirable enough to keep'. The measurement is not based on price point or even goods. It is based on basic elements like signage, store appearance, maintenance, merchandising, etc. the 12% are the high scoring stores, another 38% needed some improvement but would still be considered, to use your words, 'desirable enough to keep'.
Midge McCauley has stated quite clearly that price point is not relevant in identifying viable retail. The measurement is simply based on quality. More to the point, the real alarm here is that out of 231 storefronts, approximately 10 are retail goods. Clearly the focus needs to be on increasing the number of options available to the consumer.
As for the 'mall, just don't call it one' comment, the message to not focus on national chain stores could not have been more clear. If the suggestion is not to sell apparel, outdoor goods, shoes accessories, etc. What do you suggest should be sold? There are many different types of stores that sell 'apparel'. The differentiation here is not focusing solely on the ‘Gaps’, but to seek out local, regional and independent operators that have a quality business. Again, it comes back to quality and merchandising, not merchandise or price point. With such a small percent of current retail stores, there is no category that shouldn’t be considered.
And finally, this is the first report that has actually stated that you don't need to blow up K Street and start over. It says… we have the market, we have the building inventory, we have the local talent… it wont take a big redevelopment to get started. How is that an ode to the 'skyscraper fairy'?
I hope that this has clarified elements of the report for you and would be happy to discuss any items further.
Danielle Biller, DSP
I don't think, based on the quote, that the consultant recommended mall type, nationally branded retail but rather new up and coming retailers and start ups. Many other now flurishing areas around the country took the same approach and over the years and have done well. Old Pasedena and Pearl District come to mind. I think the 12 percent of retainable retail businesses is low,but the point is that very few of the current retailers fit the vision that the larger community wants for the Downtown core. Just because they are independent does not mean that they are desirable places to shop or dine.
I do agree that if Sacramento wants to put people in downtown after hours and make it a destination it is going to take a major facelift of the properties and streetscape to do so. Bill, I know you believe that a building's function and use matter more but the skin matters just as much. Any market study will show that if you want to be a destination and draw regional shopper that attract many market segments, the place needs to be aesthetically pleasing. I am not saying that the buildings use is less of a factor rather that architecture and good urban design is just as important. Downtown does not even come close in generating a positive perception for use or form.
I did not get the perspective that the recommendations lead to demolition of old buildings to build skyscrapers.
Don't worry Bill, once the railyards really kicks off , the ability to recruit retailers to JKL will make it hard to get anything in the core. Downtown plaza will fully fail, K Street will not look any better, and the DSP, City, and community will start another plan for this area.
We just come to the realization that K Street is a business district and move efforts to areas like J Street, L Street, and the River. That's my two cents. Oh I don't believe CADA has any units in the JKL area.
If the report is based on the idea that the existing building inventory should be reused rather than replaced, that was not delivered by the writer of this story--if it was in error, I stand corrected and would encourage the writer to review the report, because her statements imply that the report describes the physical plant of K Street as "shabby and dated," implying that it needs physical replacement. When the writer of the story described only 12% of K Street businesses as "desirable enough to keep," it gives the impression that only that 12% is worth keeping at all--not 12% high scoring and 38% with potential but needing improvement...but I still wonder about the 50% of existing businesses on K Street that the consultant considers not worth keeping.
Adaptive reuse, restoration grants for historic facades, and incentives for independent businesses all sound like great ideas, and I'd like to hear more about those.
edit: I contacted the above-mentioned DSP staffer directly, and she clarified some discrepancies between the presentation given by the consultant and the writer's story. The 18,000 people figure refers to those living within 1 mile of the CBD, not the population of the CBD or the central city. The 12% figure refers only to those who received an "excellent" rating on a five-point scale, not the only businesses "desirable enough to keep."
DSP is now working on its list of recommendations, which will be proposed to the board at the same time. DSP officials said they will seek consensus on the report and the organization's priorities, then get into the process of implementing the plan.
Half of the 103 retail spaces don't meet the bare minimum standards expected by quality retailers as defined by the consultants. While only 12 percent are considered currently desirable enough to keep, another 38 percent would need varying amounts of help to be considered desirable for the vision presented by Downtown Works, said consultant Midge McCauley.
The area includes 700 single-residency occupancy units and 220 market-rate housing units.
Maybe that's the answer...if CADA took over some of the city-owned but vacant residential units (like the Berry or the Bel-Vue) there might actually be people living in them. CADA has a good track record as a housing operator, and considering many of their upcoming projects are market-rate, they will need more low-income housing to maintain their mandate.
I certainly do not want to see K Street vacant. I was just unconvinced with this story as presented; hopefully the full report will answer my remaining questions more fully.
That is what is happening now in the night club business--little happens in downtown because Midtown is the place to go. Make downtown JKL real places to go and they will come.
I am a member of the retail consultant team, and also attended the K Street Dialogue in October. What was said by my colleague from DC was precisely the OPPOSITE of what you wrote above (K Street needs "more quasi-big box stores"). She discussed the need for downtown Sacramento to have a mix of local, independent retailers (apparel stores, tabletop, gifts, wine bars, tea houses, etc) in order to provide an experience that is entirely distinct from what suburban options offer. I'm sorry that this did not come through clearly. As to your point about the urban landscape: one of the strengths of the downtown core is its numerous, varied buildings of a scale that welcomes pedestrians - we absolutely don't advocate they be demolished.
We spent many months on this project, getting to know the area through firsthand observation and interviews with a multitude of stakeholders; this combined with an assessment of data points formed the basis for our conclusions and recommendations.
Kelly Kost, Downtown Works