[Pedestrian]

aka The San Francisco Case: Why Mandating Ground-Floor Retail Fails
December 13, 2017 Julie Littman, Bisnow Bay Area

A growing problem is emerging in many thriving metro areas that have had significant mixed-use, office and residential development. While many projects are delivering offices or apartments fully or nearly leased, their ground-floor retail often remains vacant. And it is not exactly the fault of the troubled retail industry.

“There [have] been 10 years of approving mixed-use without understanding retail and forcing retail on the bottom of a project where it doesn’t really belong,” JLL Senior Vice President Christine Firstenberg said. The empty storefronts are creating blight across San Francisco, Oakland and San Jose. Developers are delivering physically obsolete space that is too small, with ceiling heights that are too low or is in a bad location with not enough foot traffic, according to Firstenberg. Cities are starting to reconsider how they approve mixed-use development and some are thinking of charging a fee to building owners with spaces that remain vacant too long. But there is no easy fix, Firstenberg said. The problem with ground-floor retail is most apparent on Market Street in San Francisco. Crescent Heights planned to bring in a restaurant in 2013 to its Nema luxury apartment project, but the restaurateur pulled out due to complications and ongoing delays. Since then, the 13,500 SF ground-floor retail space has remained vacant, according to the San Francisco Chronicle. Nema is not alone. The Chronicle reviewed 20 housing developments on or near Market Street and found 17 vacant storefronts as of late November.

Cities continue to pursue ground-floor retail development because it is a large tax generator, according to Christina Briggs, City of Fremont deputy director of economic development/assistant to the city manager. Cities want to create as many opportunities as possible for revenue generators, especially with brick-and-mortar sales revenue declining with the expansion of online shopping, Briggs said. Retail also allows cities to activate neighbhorhoods. Activating streets can be a long and arduous process . . . .

Please read the rest of this lengthy piece at https://www.bisnow.com/san-francisco...n-francisco-re