Retail availability is an important determinant of community health. Being within walking distance of neighborhood retail improves access to daily goods and services, promotes physical activity, reduces vehicle trips and miles traveled, promotes small business development, increases opportunities for social interaction, and reduces crime by increasing street use and natural surveillance[i]. Additionally, increasing neighborhood serving retail can grow tax revenue, which can be invested back into the neighborhood. Research shows that existing residents may have a positive response to new retail if it provides desired goods and services that were previously unavailable, while causing minimal displacement of existing neighborhood retail.[ii] At the same time, it may also signal to existing residents that the neighborhood is changing and that displacement pressures are rising.
Between 2011 and 2015 retail vacancy rates were reduced by half in the CMTL area. Citywide, retail vacancy rates were already relatively low, but fell to 2% by 2015. During the same period, retail lease rates increase by on average $15 per square foot in the CMTL area and $10 per square foot citywide. In both geographies, the majority of this growth occurred between 2013 and 2015, which corresponds to when most nationwide economic indicators began to turn upward after the recession, as well as the entrance of new tech companies to the mid-Market corridor. There were no changes in retail space square footage in the CMTL area during this time, while the city did experience some decline in the amount of retail space.
CoStar via the San Francisco Department of Real Estate, 2011-2015.
[i] “The San Francisco Indicator Project: Retail Service Access.” Accessed August 27, 2016. http://www.sfindicatorproject.org/indicators/view/115.
[ii] Zuk M, Bierbaum AH, Chapple K, Gorska K, Loukaitou-Sideris A, Ong P, Thomas T. (2015) Gentrification, Displacement and the Role of Public Investment: A Literature Review. UC Berkeley & UC Los Angeles. http://www.urbandisplacement.org/sites/default/files/images/displacement_lit_review_final.pdf.