Bay Area/ San Francisco/ Retail & Industry
Published on August 25, 2014
A Plan For Castro Neighborhood Retail ComingCastro Street (photo: torbakhopper,flickr)
Vacant storefronts as of Feb 2013 (figure: OEWD)
Vacant storefronts as of Feb 2013 (figure: OEWD)
We've reported on our blog many times of businesses coming and going in the Castro and most of those stories are stories of businesses leaving. The Castro has a retail vacancy rate of around 7%, almost double the citywide vacancy rate of 3.8%. Compound that with over 30,000 more square feet of new ground floor retail coming in with new builds up and down the Castro / Upper Market corridor, and the Castro could see vacancy rates closer climb to over 10%. Many readers and Castro neighbors and businesses have expressed concern over what city and community leaders plan to do to ease the issue of retail flight in the Castro and it seems a solution may be coming. A coalition of neighborhood community groups, funded in part by a grant from the Office of Economic and Workforce Development and private donations totaling $87,200, are launching a "Retail Strategy Project" for the Castro and Upper Market area. The effort is being led by the Castro/Upper Market Community Benefit District along with the Duboce Triangle Neighborhood Association, the Castro/Eureka Valley Neighborhood Association, and Castro Merchants. The primary aim of the Retail Strategy Project is to address the existing high vacancy rate and develop an actionable plan to fill new ground floor retail in a way that enables the commercial corridor to thrive while preserving its unique character and draw as a tourist destination. The Retail Strategy Project team will be using data from a neighborhood profile completed by the OEWD last year and data from surveys conducted with area residents, tourists, and merchants to finalize their plan. A technical advisory group, comprised of funders, merchants, and neighborhood leaders will be convening regularly to review survey findings and offer feedback, according to the DTNA. Questions the Retail Strategy team is hoping to answer include:
  • What new businesses would residents like to see in the neighborhood?
  • What mix of residents vs. international, national and regional tourists visit the neighborhood commercial corridor?
  • Why are some businesses vacating the neighborhood?
  • For which goods and services do local residents leave the neighborhood, and where do they go to buy them?
  • How can desired businesses be attracted to the neighborhood?
Once the surveying is completed and the technical advisory group has made their recommendations, a consultant team from Seifel Consulting, a real estate and urban economic consulting firm, will develop a series of recommendations and present retail strategy to the public next July, 2015. 
The OEWD's neighborhood profile included a graph (below) of business surplus and leakage by industry in the Castro and Upper Market area that was especially telling of the areas current retail climate. The graph shows that the area is lacking retail representation of over 20 industries relative to local demand. The Castro is, however, rife with drinking places, used merchandise stores, restaurants, and personal care retail. Though some of the "leakage" includes, perhaps, undesirable retail such as tire shops and auto dealers, there is a significant lack of choice or existence of general merchandise stores and outdoor supply stores in the 'hood.
Business Leakage / Surplus by industry (figure: OEWD)
Business Leakage / Surplus by industry (figure: OEWD)
Whatever the plan finally looks like, you can become a part of it and add your voice by participating in surveys when stopped on the street and by following the news at the strategy team's website. As an informal survey, use the comments area below to suggest what kind of retail you'd like to see added to the neighborhood.