On restaurants, retail, and clustering – agglomeration economies and urban retail trends

A few intersecting stories regarding retail and restaurants:

In DC, a group of activists are pushing a moratorium on new liquor licenses for 14th and U and environs. There has been substantial pushback to the idea of a moratorium, yet proponents insist the dominance of bars and restaurants are crowding out brick-and-mortar retail establishments. From Jessica Sidman’s summary in the Washington City Paper:

Joan Sterling of the Shaw Dupont Citizens Alliance, the group that proposed the moratorium, kicked things off by reading from a written statement in which she talked about the negative impact the proliferation of bars and restaurants has had on neighborhood noise, parking, and rat problems.

Sterling also talked about the need for a better balance of businesses. Who wouldn’t want grocery stores, hardware stores, movie theaters, galleries, and retailers like Urban Outfitters, Container Store, or an Apple store, she asked? “These are all businesses that will improve the daytime foot traffic and strengthen the neighborhood more than strip after strip of taverns,” she said. (The moratorium would not, of course, mandate that any of those other retailers come in, nor does the status quo ban them.)

Two obvious problems arise from Sterling’s desire for a greater diversity of retail offerings. Sure, who wouldn’t want more shopping? The problem is that there’s no such thing as a neighborhood Container Store. You might have a Container Store in your neighborhood, but retail of that nature requires a much larger audience to survive than just one neighborhood (The Container Store, for example, has only four locations in the entire Metro DC area – Tenleytown, Clarendon, Tysons Corner, and Rockville – with a fifth location in Reston on the way).

Richard Layman consistently comes back to this point in his blogging. Not only does retail require a wider area to draw from, it also likes to cluster together into districts: “with transportation costs being relatively equal, people choose to shop in the retail district with the  greatest variety of stores and the most appealing choices.Not every retail district will be full of the regionally significant stores. However, many of them can be filled with a cluster of neighborhood-based bars and restaurants.

The other problem is mistaking the symptom and the cause: the old adage holds that retail follows rooftops. The real-life decisions are obviously more complex, but additional stores are likely to feed off daytime traffic more than drive it.

Retail shops are but one form of aggolmeration. In last week’s City Paper, Jessica Sidman writes about the growing cluster of restaurants in part of the proposed moratorium zone. 14th Street, H St NE, 8th St SE, and others – in addition to the city’s already established dining zones. Payton Chung takes note of the trend – that retail is restaurants. Payton cites Terranomics: “There is only one segment of the market where we are seeing aggressive growth plans from inline users and that is the restaurant sector.” Payton adds:

Yes, we’d all love to be able to walk to the corner and buy some bolts from a corner hardware store, or socks from an apparel shop, but let’s face it: not enough of us do that often enough to sustain very many such businesses, particularly in areas that don’t have enough foot traffic to guarantee significant cross-shopping. Such uses will increasingly congregate within metropolitan subcenters — probably focused on today’s fortress malls or midtown destinations — so there will be winners and losers among retail nodes. At least everyone will have someplace to eat, though.

(BTW, connectivity to those subcenters will be necessary from ever-wider catchment areas. This will require rapid transit, not just walk accelerators like streetcars or bikeshare, in order to connect neighborhoods to retail focal points.)

Hard to fight the trend, particularly when additional restaurants can add value to neighborhoods – particularly when they cluster together. Payton’s point about the rising importance of regional transit to link these regionally significant centers together is a good one, as well – the pattern of transit-oriented development around transit stations can be a positive feedback loop for additional transit ridership and development. Regional significance can mean that a place achieves that critical mass where the retail draw is indeed pushing daytime traffic – but those kinds of centers will be limited to a few key parts of each region.


2 comments to On restaurants, retail, and clustering – agglomeration economies and urban retail trends

  • frebb

    Yeah it’s true, basically the fact that I can hardly do jack shit in my neighborhood in DC anymore other than go to motherfucking restaurants and I have to go way out to the suburbs on a Metrorail that doesn’t work on goddamned fucking weekend anymore to buy any shit other than restaurant bullshit has made me decide to kill myself.

  • Kevin

    You obviously don’t live in these areas where oversaturation of liquor-serving establishments has caused horrible problems with parking, congestion, noise, trash, rodents and other issues. You mock quality-of-life issues in the name of tax dollars that smell of booze. How about when someone takes a squat in your front yard or leaks in your driveway? How about when they throw up on your sidewalk so your dog can stick its nose in it? How about when cars go around and around your block blaring their stereos looking for a parking space? How about when jerks block your garage when you come home? How about when people are shot or stabbed several times on your block because of a fight that happened at the next-door bar? Pass the liquor license moratorium. Pass it now! Adams Morgan and other areas are not worse off because of their moratoriums. They are better off. They did not get worse. Why do you think the moratoriums were passed in Georgetown and Adams Morgan? Because they were growing out of control! Fights, screaming, and bottles littered everywhere? And reputations as places where people went to get laid, not to live a decent life. Get a clue. You don’t know what you’re talking about.

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