downtown oakland
Downtown Oakland circa 1910

Future of the Fringe

February 17, 2012

A few years ago I wrote a series of blogs asking the question, where is the DTO? I have been meaning to revisit the question after revitalization has taken firm root throughout downtown, particularly in the Uptown area. One question to be explore is, what are the boundaries of downtown? Does downtown end at Grand Ave? Is the Jack London District part of downtown? I would argue that both of those areas are part of downtown, because their high-density development patterns are linked to their integration in downtown’s transit network.

Both Jack London Square and Upper Uptown are the subject of large-scale redevelopment plans, even though Redevelopment Agencies are closed. Jack London Square has approval to build several new office buildings, and the greater Uptown area – called Broadway-Valdez after its biggest streets – is currently in the planning stages of a retail-focused revitalization effort. Two recent articles shed light on the future of these projects.

In Jack London Square, logistics software firm Navis has signed a lease for 35,000 square feet of the new Jack London Market building, bringing its office space to full capacity (its retail space currently only boasts one tenant, Daniel Patterson’s Haven restaurant). Though the relationship between office lease rates and construction costs is unfavorable to developers, the main factor driving office construction is the vacancy rate, which is now near zero for Jack London Square office space. Might we see future construction on a new office district on the waterfront? Read more at the SF Business Times.

This week’s East Bay Express included a pessimistic article about the future of the Broadway Valdez plan, which hopes to leverage residential demand to build retail spaces appropriate for anchor tenants like Macy’s. (Full disclosure: in my capacity as Board President of Walk Oakland Bike Oakland, I am a signatory to a coalition letter expressing a vision for the area. I also worked for Conley Consulting Group on the feasibility study for the retail area several years ago, which you can find as the first result of this search.) While the loss of redevelopment funding is certainly a blow to the plan, there is no reason why the Specific Plan process cannot continue, as long as there is market demand to build what the City wants to see.

Unfortunately, much of the Express’s article and the discussion around it centers on the supposed opposition between large-scale retail and small business, with many Oaklanders preferring the latter. However, that is a false dichotomy – big retail businesses bring in customers and help support thriving shopping districts, in which small boutiques can find success. This is in fact how every major urban shopping district works: even posh Union Square hosts local businesses like Wilkes Bashford, M.A.C., and Arthur Beren. Conversely, there are very few examples of successful shopping districts without large anchor tenants; I can’t think of a single one (and no, Rockridge doesn’t count).

If the point of Broadway Valdez is to capture the billions of dollars that Oaklanders spend in SF and Walnut Creek, then a department store is necessary. If the goal is to foster an environment where small business can thrive, a department store is also necessary. Can this area be revitalized without redevelopment dollars? Perhaps, but it will have to be sensitive to the market, which is not Oakland’s strong suit. Stay tuned for upcoming meetings on Broadway Valdez, likely in the Spring.

7 comments

1 Oakland Space Academy { 02.17.12 at 6:07 pm }

Wait! Why doesn’t Rockridge count? You at least have to explain that.

Nice writeup though. It was interesting to hear about JLS office vacancy. I recently turned down a job offer there because it is so poorly served by transit. If Oakland does allow more office construction in JLS, it should be accompanied by transit improvements to get the Free B Broadway Shuttle headways down to 5 minutes max, at least during rush hour. Urban design improvements would be nice too, the only charm the area has is the fake charm of a festival marketplace.

2 dto510 { 02.17.12 at 7:28 pm }

We are starting from the study that shows Oakland not capturing about a billion dollars a year in “retail leakage” – consumer spending outside of city lines, including in Walnut Creek and San Francisco. Therefore our existing shopping districts are not meeting the need. But more specifically and anecdotally, the only men’s clothing option (besides T-shirts) on Oakland’s longest shopping strip, Rockridge, is the wonderful vintage store Pretty Penny (5488 College Ave). While a great shop, it doesn’t sell the items that most men spend most of their shopping dollars on. Women have it a little better, but we know that local retail is not fulfilling most needs. The City of Oakland’s sales tax share of the purchases made in other cities comes to about $10 million. This figure may even understate the total opportunity cost of our dearth of department stores, since people who live close to retail tend to spend more money than those who have to make a longer trip to shop.

Yes, the Broadway Shuttle (and the ferry) are not adequate to support transporting thousands of employees to Jack London Square. But there are multiple funding sources for a better connection, including funds in the proposed County transportation sales tax headed to the November ballot, and binding commitments made by the developers of the Square. And to your last comment, my aesthetic point of view is that the Square is better-looking than it used to be, but of course there is a lot of room for improvement.

I’m glad you like the article!

3 becky { 02.17.12 at 11:15 pm }

If not Rockridge, do you consider Grand Lake a successful shopping district? Are you considering the Gap and/or Trader Joe’s as anchor stores there? Or is it too small to really count? I’m not arguing that Oakland doesn’t have a huge retail leakage problem. But I feel like I can go to Grand Lake and buy all sorts of everyday essentials (milk, socks, all-natural toothpaste) in a way that I can’t in Rockridge.

And is a department store tenant enough? The Sears in Uptown is pretty bleak.

4 dto510 { 02.18.12 at 12:07 am }

Rockridge, Montclair, Piedmont Ave and Fruitvale* are successful in their own way, but not on the scale needed for capturing some billion dollars of “comparison goods” shopping. The retail leakage study found that Oakland attracts dollars from outside the city at drugstores and convenience retail, probably partly due to the large working population. Grand Lake is big and concentrated and provides a breadth of services, but the Gap and a few boutiques don’t provide the choices you can find in a nearby city, or the things people spend the most money on, such as business attire. Grand Lake has improved a lot in the last decade, and it still has room to grow.

I added a link to the retail revitalization report in the blog.

* Fruitvale is probably competitive with SF in its market.

5 Jim T { 02.24.12 at 7:23 pm }

I believe the term is destination retail. Customers won’t travel to an area for a single boutique but will for a chain store they know. Then when being present, they may be enticed to shop at said bouique (if, for instance they walk by it rather than having parking directly at their destination). This is why we have retail districts, and for that matter why malls work (shudder).

6 don { 02.25.12 at 8:45 am }

I think you’ve got it backwards; small retail leads to big retail, and in any case if you can’t get big retail, small retail will do. And, yes, Rockridge counts, as do other successful small-retail neighborhoods here, in SF, in Portland, Seattle, New York, Chicago, Miami, Paris, London, Buenos Aires, and a thousand other densely-settled places with thriving neighborhoods Crate and Barrel hasn’t opened a store in the middle of yet. (Grand Lake benefits more from the Saturday Market that it ever has from the Gap.) Big national retail “anchors” were never going to touch downtown Oakland without really stupendous bribes, and maybe not even then. Without that incentive, those chains, if they’re inclined to expand at all, will settle where there are already thriving shopping districts. Encouraging local businesses – like, for example, offering potential small-business-owners the tax breaks and free rent a national chain would extort as a matter of right – is Oakland’s only route to a downtown with enough retail in it to even keep downtown residents’ money here.

I have nothing at all against national chains, giant department stores, or big-box retail (well, maybe a little), but I just don’t see those stores coming to downtown Oakland. It’s not 1927 with Union Square a streetcar-to-ferry-to-streetcar ride away, and Walnut Creek just a country town. It’s not WW2 with hundreds of thousands of well-paid war workers flooding the inner East Bay with a whole depression’s-worth of pent-up consumer demand. It’s not even 2000 when Oakland could still – maybe – have outflanked Emeryville and built a Bay Street downtown. All that’s done. it’s not coming back. (And FYI Oakland never “lost” the retail dollars of Contra Costa suburbanites – they never shopped here in the first place.)

But I do believe small, successful retail and incremental, multi-owner development builds destination neighborhoods more surely and securely than the insertion of mega-developments. Look at post-freeway Hayes Valley vs. the Metreon, or even Rockridge (College Ave) vs. the Rockridge Shopping Center (which was sad, underused, and kind of lifeless even before the loss of Big Longs). Hayes Valley and College Avenue are doing fine, and the Metreon and Rockridge Center are both receiving or scheduled for drastic makeovers, less than a generation after they were built. That’s not stability. A light hand can be far more effective than a bludgeon. The Valdez plan was a bludgeon and I’m not sorry it’s in trouble; better now that in 10 years when we look up and all we got were some parking garages and a couple of failed second-tier mall stores.

7 dto510 { 02.25.12 at 2:55 pm }

We’re not talking about the government giving stores free rent, but planning for private development (and maybe subsidizing transportation infrastructure, etc.). Oakland is trying to create an urban retail center, not something like the Rockridge Shopping Center – which at least fulfilled some department store needs back when Big Longs was there – or the Metreon, but like Union Square or downtown Walnut Creek.

No matter how much people praise our charming neighborhood commercial districts, the fact is that Oaklanders are choosing to spend the bulk of their retail dollars outside of the city to the tune of a billion dollars a year. Rockridge and the other districts simply don’t offer what most people want. Check out the EBX’s local and eco-friendly shopping guide in the current issue: the entirety of shopping options in that vein are gifts for women. Men live here too, and so do people with jobs that require dressing up, and people who like fashion, or electronics, or artsy housewares. It is unquestionably true that Oakland would gain from capturing more of the our retail spending.