Whether it’s Washington Place, Austin Street, Elm Street, Upper Falls or even a smaller project in Nonanutm, most of the major redevelopment happening in Newton includes some level of retail. Skeptics point to the vacant storefronts in the villages, or those dominated by banks and salons as evidence that the city just doesn’t need more retail, or say that the parking challenges are too great for the existing vacancies*.

Add to this the “retail apocalypse” that is taking down everything from mom and pop stores to national chains, and you have the makings of a disaster. In fact, Newton is now home to two outposts of Amazon’s new brick-and-mortar empire.  One broker told me that his client is not interested in any company that can be “Amazoned,” so straight-up retail is out of the question for them, even if that company wants to fill the spot.

But this isn’t just a matter of having retail space available and letting the market control rents. Some of the problems we have in Newton are reflected in what’s happening on Boylston Street near Arlington in Boston. This is around the corner from the amazing retail a block away on Newbury Street. As Janelle Nanos writes in last week’s Boston Globe

“Given its location, it should have some of the best retail in the city of Boston,” said Jason Weissman, the founder of Boston Realty Advisors. The problem, he said, is that this section of Boylston lacks institutional ownership. Newbury Street’s buildings are primarily operated by two large real estate firms, Jamestown and UrbanMeritage, which structure deals to curate storefronts for the right retail mix. Boylston Street is less organized.

“There are a lot of private owners and families that have owned those buildings for a lot of years,” he said, “and I don’t think there’s anyone’s putting a gun to their head to develop those properties.”

Our villages tend to be dominated by smaller, long-time owners, trusts, and families that can sit on empty storefronts and wait for their price. They aren’t necessarily concerned about overall foot-traffic in the village and don’t worry about the retail mix. Their business models don’t have significant income coming from the upper floors (these are often single-story buildings), so they aren’t concerned about the negative impact that an empty storefront would have on the rest of the property. They also may have a tenant that prevents them from taking on a company that may appear competitive. So if you host a clothing store or a pizza place in your building, you may have a provision that prevents you from bringing on any other store that is too close. 

Compare this situation to what’s happening in Cambridge, where multi-story buildings are helping pay for the retail frontage. An official there recently told me that owners in places like Kendall Square and Central Square are dropping retail rent prices, or even giving retail space away, so they can keep the commercial tenants of their buildings happy. An owner of a Cambridge coffee bar told me that he regularly receives pitch decks from owners of multifamily buildings and commercial properties practically begging him to move in. If he wanted to go rent-free, it’s not all that difficult. 

So what’s the solution? Maybe there isn’t one, maybe this is working. Maybe the current retail mix is the right one for the city. Arlington and Watertown seem to want something more and are willing to try something new. We’ll have to see if it works. 

But if we want something different, then we need a real solution. And I don’t think there is a single answer. Some of it will come with time. As properties turn over and are purchased by larger developers, they may create a different income model (thanks to apartments, condos, or offices) that allows them to subsidize retail. We may also see co-working locations start to pick up some vacant storefront space. I’ve spoken with a couple of co-working companies that operate this type of model. It could be that the owners of a series of properties come together and find some kind of collective solution. The idea of a Business Improvement District has come up a few times in different contexts, but the diversified nature of Newton’s villages make this concept challenging at best. 

The point of all of this is that empty storefronts don’t tell us nearly enough about what is really going on in our villages. We need better communications with the building owners and a true understanding of their businesses to help create vibrant downtowns with the right mix of shops. 

 

*  I personally don’t believe that a lack of parking is the problem. I know people have anecdotal evidence, but our parking studies say otherwise. But that’s a topic for another post.

 







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