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Grand Avenue Retail: Why Should We Care Now?

By Eric Richardson
Published: Tuesday, April 25, 2006, at 11:23AM
Grand Avenue Presentation Eric Richardson [Flickr]

Yesterday at the Grand Avenue Project event one of the people I saw was Times reporter Cara Mia DiMassa. We said hi and then she excused herself to figure out what she was going to write for today's paper. What she and co-byliner Roger Vincent ended up with was this story on how the Grand Avenue Project hasn't yet signed up big retailers.

Or at least that's how the story's titled -- "Retailers Not Sold on Grand Avenue" -- and how it's been picked up in the blogs. I don't see it, though.

Bill Witte of Related Cos., Grand Avenue's developer, said Monday that he understands the Grand Avenue project faces challenges but believes it ultimately will succeed.

The developers said they hope to be able to announce some of the project's key retail tenants, including the boutique hotel and several restaurants, within three or four months.

Witte called preliminary interest in the project "remarkable" but also struck a cautious tone.

"This is not easy," he said. "When you are pioneering, it is never easy."

I have no problem looking at this as a non-issue for the Grand Avenue Project. Heck, their buildings won't open for several years. Retail is always slow, but when they're opening the doors in 2009 I think they'll have a nicely stocked tenant list.

That said, the slow speed of retail is a much more interesting issue for the rest of Downtown, where spaces are already available.

From the article:

Over the last year, downtown business groups have aggressively tried to persuade popular stores in places like Pasadena and Hollywood to open branches in the city center.

Despite tours and demographic presentations, many well-known chains, including In-N-Out Burger, Trader Joe's and Barnes & Noble, have so far said no to the area.

"The chains aren't interested yet," said Warren Cooley, project director of the Historic Downtown Retail Project, a city-funded endeavor to attract businesses downtown. "There's not enough population and critical mass. There are still challenges. The homeless issue on the street is a concern when real estate investigators from big chains look. That's sometimes something that concerns them."

I would tend to think that if you asked Cooley he would say that far more important to retailers than the homeless issue is that of critical mass, and just as importantly that of convincing retailers that there's more to be made by going outside their normal store model.

Take a premium fast-food chain like In-N-Out for a minute. Their market model involves staying open late and having a packed drive-through. If I'm in corporate and looking at Downtown, I'm looking at Figueroa to see the USC population to the south and the post-Staples driving crowd to the north. At this time I'm not looking to move into a walk-in only location in the Financial District or Historic Core. The numbers just aren't there.

The big chains aren't risk-takers or early-adopters. They can buy their way in when the time's right for them, but they're not looking to stick their noses out.

Far more important is to convince the local entrepeneur that Downtown is really going to happen. They're the ones that can understand and really make a move. And that's been largely the business that we've been seeing. I like that. Let these people get in on the ground floor. The chains can figure out their way in later.


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