RETAIL IN ALAMEDA: What stores can we attract?

RETAIL IN ALAMEDA: What stores can we attract?

Michele Ellson

A map of Alameda's commercial districts. Courtesy of the City of Alameda website.

For years, Alameda has served as a destination for onetime city dwellers who prize its vintage homes, tree-lined streets and not-too-suburban feel. But almost as often as not, Alamedans leave the Island to buy the things they need.

Alamedans spend $960 million a year at grocery stores, clothing shops and other retail outlets – 44 percent of which is handed to merchants operating off-Island, according to the city’s estimates. About $13,000 of the roughly $30,000 Alameda’s households are estimated to spend in retail outlets each year buys goods somewhere else, one study found.

“We have retail leakage in pretty much every category,” Interim Community Development Director Debbie Potter said.

The in-progress development of the long-awaited Alameda Landing project near the Webster Tube – a project that includes a 291,000-square-foot Target-anchored shopping center – has stirred hopes at City Hall and citywide that long-desired retailers offering clothing, high-end grocery, paper goods and more will finally come to the Island. But retail experts and city staffers who have been working to bring stores to town said drawing them requires a carefully crafted admixture of demographics, relationships, timing, space – along with a little luck.

“You’ve got to find a retailer you like and they have to be in expansion mode and be willing to expand in Alameda, and like your project and want to be with you,” said Sean Whiskeman, first vice president of development for Catellus, which is developing Alameda Landing.

Macy’s, Whole Foods and Pier 1 were among the stores The Alamedan’s Facebook fans said they’d like to see here when asked last week, along with a stationery store like Paper Source or Papyrus and clothing stores like Gap, J. Crew, H&M and Anthropologie. Both Potter and the real estate people charged with filling Alameda Landing and Alameda South Shore Center said they’d love to have those stores, too.

Whiskeman, who has worked on the Alameda Landing project since 2001, said he’s heard every argument against setting up shop there. He said the developer faces many challenges in making the case for Alameda.

Alameda’s island location and lack of the direct freeway access prized by retailers are some of the city’s biggest barriers in attracting stores, retail experts and city staffers said. Regional retailers like Macy’s, H&M Pottery Barn and Williams-Sonoma want locations with good main street frontage or freeway access that offer a few hundred thousand people from which to draw a store’s customer base, Whiskeman said.

“They might view this kind of Oakland/Berkeley/Alameda market as a one-store market, and they’re at Bay Street (in Emeryville),” Whiskeman said. “In their minds, they’re capturing this market with their store there, which is in a regional location, because it’s in the middle of everybody.”

Retailers are also reluctant to blaze trails into new areas, Potter and others said – a challenge for retail-challenged cities like Alameda. Add to that the fact that the Island has also long been perceived as being hostile to business, though City Manager John Russo said City Hall is working to change that; last year, the city hired a retail consultant, and staffers have drafted marketing materials intended to sell Alameda as a place to do business.

Major changes in the way retailers decide where to put new stores have also had an impact, real estate experts said, as they increasingly rely on detailed demographic and psychographic data – which measures the values, lifestyle and interests of a retailer’s customer base – to find what they hope will profitable markets. The data-driven approach has ushered in an era in which retailers are more cautious about opening new stores.

“In the old days, we used to take one of those city maps you’d get at 7-Eleven and put dots on it, and we’d draw our own little rings. We’d all as brokers cut out rings of a mile. That was our GIS system,” said Peter J. Orlando, a senior vice president with Retail California, a commercial real estate brokerage based in Fresno.

Now, Orlando said, brokers use sophisticated information systems that can generate a “heat map” showing where a retailer’s prospective customers are, and property tours are conducted with demographic data-laden iPads in tow.

But the biggest impact to retail development in recent years has been the economy, which killed a host of major chains and sent others scrambling to redefine themselves.

Two of the three electronics stores Catellus had considered approaching for Alameda Landing went bankrupt after the 2008 crash, as did Borders, which shuttered its South Shore store after less than three years there. Fresh Choice, one of the two healthy food-options readers said they’d like to see here, shut all its restaurants at the end of 2012 (a rep for the other, Sweet Tomatoes, said the company is not expanding now).

After years of closing stores, Gap has begun expanding again – in Asia and South America, according to press releases and an annual report on the company’s website. And other companies are focusing efforts on building a more robust online presence.

“Even a year ago, the only folks who were doing anything were drugstores, banks and fast food, Potter said. Whiskeman said survivors of the crash included luxury goods makers like Coach and discount retailers like TJ Maxx.

With the economy improving, though, city staffers are hopeful Alameda can begin to attract more of the stores that people want – which will help restore a sales tax base that died when all of Park Street’s auto dealers left. They say retailers are beginning to turn away from freeways and to consider underserved markets like Alameda. And they’re hoping the renewed effort to be more welcoming to retailers – along with the hard-fought success of the Park Street shopping district – will entice more of them to plant stores here.

“Alameda is a unique community. And we’ve got the critical mass to support the new retail. We’ve got the leakage. We have an opportunity where you can come and be successful,” said Leigh Boyd, the city’s retail consultant.

Still, they said that stocking a shopping district with the higher-end retailers residents want will take time. Assembling the collection of shops lining Emeryville’s Bay Street and the one on Berkeley’s Fourth Street took decades, Potter and others said; lining Park Street with its existing collection of boutiques and restaurants took a dozen years.

Russo said that he didn’t approach Gap, Anthropologie or Pottery Barn during his recent trip to a retail convention in Las Vegas because “that’s not where we are yet”; the city needs to establish a stronger record of retail success first.

Creating a shopping district that attracts these coveted retailers also requires a singular vision of what a planned shopping center or district could be, retail experts said.

Stephen Rusher of Cornish & Carey Commercial Newmark Knight Frank said he’s marketing Alameda South Shore Center as the place to be for stores serving yoga moms and the stroller set. Just this week, Crazy 8, a Gymboree affiliate, signed a lease; other recent additions include an ULTA beauty store and Weight Watchers.

“We’re presenting a case that if you’re a family friendly retailer, you really should be considering Alameda over Fourth Street in Berkeley or Bayfair (mall in San Leandro),” said Rusher, whose firm has leased out 10 percent of the shopping center over the past two years.

Given its distance from even the entrances to Alameda, Rusher’s firm and the shopping center’s managers are also working to stock the center with unique dining and shopping options not available anywhere else – a list that includes the Total Woman Gym & Day Spa and Trabocco, a new restaurant that will be helmed by an Alameda resident who once supervised chefs and developed recipes for Il Fornaio.

“We need people to come to us. We need to offer something to make them drive an extra 10 minutes,” Rusher said.

Whiskeman said Target “is a pied piper of sorts,” one that could attract some of the clothing and other stores residents want to see on the Island.

He said kids’ clothiers Carters and OshKosh like to set up shop near Target stores, along with tween girl apparel seller Justice and Tillie’s, which serves younger adults. Gap, he said, “would certainly co-tenant with Target, and does.” Men’s Wearhouse could also be a possibility.

He said finding a local presence for the center – something desired by some who don’t want to see a mass invasion of chain stores – is important. “We’ve talked to a few local business owners about expansion here. We expect to talk to a few more. Our door is wide open for it,” he said.

The company has also reached out to local businesses in Oakland, Piedmont and Berkeley regarding expansion opportunities here, and has talked to popular local food purveyors including Zachary’s Pizza and Pluto’s, a San Francisco-based chain that serves up salads and fresh-carved meats.

Ultimately, Whiskeman said Catellus wants to assemble the right mix of national, regional and local stores and restaurants, and he said the developer is working to attract some of the retailers Alamedans are asking for. He said Whole Foods had been to the Landing site “20 times” but ultimately decided it wasn’t the right place for a new store and that the developer has been talking with Pier 1 “and would love to lure them here.” He’d also love to attract a Nordstrom Rack, though he said that they, too, want a home in Emeryville.

“I’m willing to be patient,” Whiskeman said. “I would love for those guys to be here.”

RETAIL REPORT

Here’s what retail experts and city staffers said about Alameda’s chances of attracting stores readers want.

Macy’s, H&M: Retail experts said Macy’s and H&M are regional retailers who aren’t likely to come to Alameda; they’re looking at major thoroughfares and large regional malls as sites for their stores. They also noted that Macy’s has been struggling financially and isn’t really expanding now.

Whole Foods: Catellus’s Sean Whiskeman said Whole Foods looked at Alameda Landing but opted not to set up shop there; he and the city’s retail consultant, Leigh Boyd, said they think the grocer will set up a store in Alameda eventually.

Pier 1: Whiskeman said Catellus has talked to Pier 1 about a store in Alameda and would love to have them at Alameda Landing; a Pier 1 rep said the company didn’t have immediate plans to open a new store here and, like most retailers The Alamedan contacted, wouldn’t comment on specific expansion efforts.

Paper Source, Papyrus: A spokesperson for Paper Source wouldn’t comment on specific expansion plans; a Papyrus rep was still gathering details at press time. City Manager John Russo said the city could “absolutely” attract a paper products store.

Gap, Banana Republic, J. Crew: Whiskeman said that middle-tier retailers like these – not selling luxury or discount goods – are struggling to reinvent themselves in the wake of the 2008 crash. He said Alameda could attract a Gap; the clothing company is opening more stores than it’s closing for the first time in several years, though their focus is overseas.

Pottery Barn, Anthropologie: City Manager John Russo said the city needs to offer more proof retailers can be successful here before attracting “lifestyle” retailers like Pottery Barn and Anthropologie.

Fresh Choice, Sweet Tomatoes: Fresh Choice shuttered all of its stores at the end of 2012; a rep for Sweet Tomatoes said the healthy eats chain, which has several East Bay locations, isn’t expanding right now.

Comments

Submitted by mom (not verified) on Thu, Aug 15, 2013

How about The Loft?

Submitted by Anonymous (not verified) on Thu, Aug 15, 2013

Maybe WFM will wait til Lucky's/Albertsons closes up then take that space.

Submitted by jenn (not verified) on Thu, Aug 15, 2013

In all honesty, what we should be looking at are small, independent, interesting stores. Alameda could really benefit by embracing the small, unique business model. No more nails, yogurt or coffee. This stea is dying gor clithing that is man-centric and goods that are not a dime dozen.

Submitted by Diana (not verified) on Thu, Aug 15, 2013

Why are we aiming for big box stores? Alameda's thriving small and local business community is exactly what made me move here when I relocated to the bay area several years ago from Portland. Let's not keep adding to the corporate shopping experience and start fostering more local business - for example, A Berkeley Bowl over a Whole Foods. There is support in the area for such businesses and we don't need to allow our island to turn into an Emeryville-like shopping destination.

Submitted by Hal Keenan (not verified) on Thu, Aug 15, 2013

Every one a chain. We don't need that element at all. This alamedan prefers to shop locally owned independent businesses, rather than throw the local economy into some out of state corporate cesspool.

Submitted by Anonymous (not verified) on Thu, Aug 15, 2013

A few years ago I used to sit on the Economic Development Commission of Alameda and chaired the Business Attraction Committee. We wrote a report that was enthusiastically adopted by the EDC and the city council that called for more proactive business outreach using online methods which are standard these days. Very few of the recommendations have been adopted. When business attraction and development is left to developers rather than driven by the city and it's citizens we are likely to end up with a retail mix that will decrease quality of life on the island. As I live on the West End I can tell you that even now sometimes it takes 30 mins to get out of the tube on a Sunday afternoon, can you imagine what it will be like once all these stores go in? Yes, we want more revenue for the city, there are many ways to do this, I see the Alameda Landing Project as a disaster waiting to happen.

Submitted by Anonymous (not verified) on Thu, Aug 15, 2013

So hoping we can attract more higher end stores. Stop treating the west end like ugly step child. If we keep seeking low end, we'll continue to attract low end. Remember, water seeks it's own level!

Submitted by Anonymous (not verified) on Thu, Aug 15, 2013

If you look at Ashland, OR as a role model, they do not allow chain or box stores, only small independents with the exception of Safeway, banks, and, near the college campus you'll find a Blockbuster and Wendy's. Box stores and chains are found in neighboring Medford. Ashland is a small college town and known for it's Shakespeare Festival, great B and B's, and many small independent businesses and restaurants. Great place to visit and enjoy that small town community feeling. I used to travel extensively for business before retiring to Alameda and could see over the years how each town was stripped of it's individuality only to conform to what everybody else had...chains, big box, thereby losing their own sense of self. Alameda has such great potential to stay uniquely individual and capitolize on it's own rich history. Stop trying to look like all other cities and be yourself!.

Submitted by Michele Ellson on Thu, Aug 15, 2013

Hey folks: Stepping in to let you know that while we've opened up our commenting system to allow comments without registration required on a test basis, we do prefer that you leave your name when you comment (rather than submitting anonymously). Thanks for your cooperation on this!

Submitted by Carlo Balboni (not verified) on Thu, Aug 15, 2013

Funny how the article is all about chain stores and all we want is local independent stores.

Submitted by Michele Ellson on Thu, Aug 15, 2013

Hi Carlo: The article is based around a question I posted to Facebook asking people what kind of stores they'd like to see here in Alameda. The ones that gained the most responses - Macy's, Whole Foods, Pier 1, paper, home goods and clothing stores - are the ones I honed in on (though we also talk about people's desire for local, independent shops in this story). You can see the answers folks posted here: https://www.facebook.com/AlamedaCommunityNewsProject (it was posted August 6).

Submitted by Anonymous (not verified) on Thu, Aug 15, 2013

How about investing in a car ferry that services Jack London and West Oakland Bart?

Submitted by Bonnie (not verified) on Thu, Aug 15, 2013

You know. We have an amazing small boutique food shop--The Marketplace. You can get cheese, wine, fresh baked goods, meat, coffee, and well-priced organic produce. There is also Dan's produce. We DO NOT need another grocery store. Nor do we need any of the big box chains. We have so much to offer from Julie's coffee house to Books Inc, Sumbody to Tucker's to the Marketplace, American Oak, Scolari's, Linguinis, Pappo, Toy Safari... It's all here people! I'm really upset that Ulta came into town. South Shore Beauty Supply has been so great over the years. Perhaps I'm biased. Me, my parents, and my grandparents all grew up here. I don't want Fourth St or Bay St. It's a bunch of cookie cutter nonsense. I spent a number of years working on Fourth St--nothing but horrible traffic. Be happy with what we have.

Submitted by Cybelle (not verified) on Thu, Aug 15, 2013

The problem is while I love shopping at the local stores there just isn't enough of them here in town. I have to either shop online or head off the island in order to buy clothes for myself and my family. There isn't one store here that caters to teen/young adult women like H/M or Forever 21. That's where my daughter wants to shop. I love having these great local businesses but if you want to have more tax revenue then you need to put in stores that people will want to shop at. Everyone I know leaves Alameda and heads to Pleasanton, SF, or Walnut Creek in order to go shopping.

Submitted by Islander (not verified) on Thu, Aug 15, 2013

We don't need any more chain stores. Also, there are tremendous traffic and parking issues related to the congestion on Park St. and we don't need to recreate those same congestion issues on other parts of the Island.

Submitted by Jack (not verified) on Fri, Aug 16, 2013

If the goal is to replace tax revenue lost by the exit of the auto dealerships, why not look for similar large dollar items, such as appliances? We have new housing planned for the Point, so they will need not just applicances but furniture as well. We've had to replace a washing machine a few months back and went to Home Depot in Oakland - we're looking to replace our stove ($1K) and our options are HD or Airport Appliance in Hayward.
I agree we don't need to go looking for what we already have and give up dreaming about retailers like Macy's coming to town. It just won't happen. We couldn't even support a Pennys store when we had one.

Submitted by Li_ (not verified) on Fri, Aug 16, 2013

We haven't talked much about destination stores. It wasn't lack of clientele that caused Quilt Fans to close - a fabric store out on the otherside of Bay Farm. Alameda is central, easy to drive around, safe, our malls have good parking. Has anyone noticed that on this side of the hills there is no Apple store between Berkeley/Emeryville and San Jose? Has anybody noticed the number of diehard supporters of Apple who no longer live on campus but have moved up to the Oakland hills, Piedmont, Alameda. We are older and have trouble getting through the Bay Bridge maize, the tunnel, the complex on/off ramps, though we won't admit it. Mothers with strollers have trouble with parking kiosks. But they could take their iPhones in to South Shore or Marina Village easily.

Submitted by Karin (not verified) on Fri, Aug 16, 2013

Continueing to service the low-income bracket because retail thinks it is safe, will never further our goal. I am insulted by the way T J Maxx stocks the Alameda store. Our demographics our just as good as Dublin and San Ramon. I want to shop in stores that are maintained, well-stocked and cleaned on a regular basis!. Mervyns and JC Penney did the same thing (with regards to stocking and maintaining). And thinking that by putting Pottery Barn, William Sonoma and H & M in Emeryville serves our market; they are wrong. I do not go to Emeryville because the freeway situation is always bad and I don't like getting there on surface street. And to pay for parking... please. I would rather go to Walnut Creek.

Submitted by Mary Ellen McMuldren (not verified) on Fri, Aug 16, 2013

Emeryville's retail traffic patterns are a nightmare and I will not shop there.
Yes, the west end needs a quality grocery store and I'd prefer Rainbow, Berkeley Bowl, and WFM would be okay. WFM did take my suggestion by email and considered Alameda. I think they want to come here but are waiting for the Lucky's spot as it would suit them better. The new Bonfare at Neptune Plaza is a glorified liquor store.
Safeway is NOT a quality grocery store.
I used to appreciate the low cost gas at Safeway but now I'm annoyed as the gas price seems to fluctuate 2 or 3 times in a 24 hour time period.
There is SO much retail space available it is ridiculous.
I cannot understand why new developments in Alameda are designed to be so very car-centric. 3 drive-thru businesses in one shopping area? Is this adjacent to a highway? The best of Alameda is the old-style commercial development.

Submitted by Anonymous (not verified) on Fri, Aug 23, 2013

I agree with previous posts. We should cater to more independent retailers and mom and pop shops. Let Alameda stand out as a reason to come here, not just a run of the mill type stores. Alameda should focus on more sustainable ways of living and healthier eating options. With so many families becoming more aware on how food ties in with health it just makes sense to become more innovative and a destination.

Submitted by Denise (not verified) on Sun, Sep 8, 2013

I have to agree with Cybelle, I'm so tired of driving to South Shore ever
time Walgreens, or CVS runs out of computer paper. Something that simple should always be in stock but it's not, so you have no choice but to go to Office Max at South Shore for something as simple as paper. Also we have nothing on the West End it's time for more retail.

Submitted by Jessica C. (not verified) on Mon, Sep 9, 2013

I am looking forward to the new retail location with chains. I hope they have a good mixture of chain and local stores to keep an Alameda "feel" to the place. Once the Target opens and if the Michael's materializes, I will only need to leave the island for shopping to go to Costco down on Davis in San Leandro.

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