The Loop: Eclectic Stores vs. National Chains

Recently I read about two chain restaurants taking over the Streetside Records building on Delmar in the Loop. The store was not closing but the building owner made a deal to lease the space to two chain restaurants when the Streetside lease expires. To everyone upset about the loss of “record” stores, don’t be. When was the last time you passed a typewriter store? Markets shift and like it or not records are like 8 track tapes. Hell, I can’t even recall the last time I purchased a physical CD — certainly before the iTunes Music Store opened.

This week the RFT had a follow up story on the subject of chain stores in the loop, it seems some local merchants want to set a limit on the number of chain establishments:

Spearheading the move to institute a cap on chains is Patrick Liberto, owner of Meshuggah Café, who says the incursion of two new restaurants spurred him to action.

“We are going to lose our eclectic qualities. We’re going to look like Clayton,” Liberto complains. “The Loop is going to get a lot less interesting to people if they see the same things here that they see in their own neighborhood.”

Liberto wants to set a limit that no more than ten formula restaurants and ten retail chains be permitted in the Loop, and that none can occupy a space greater than 4,000 square feet. The Delmar Loop is home to seven retail chains, including Footlocker and Blockbuster Video. When Chipotle and Noodles & Company arrive, the number of chain eateries will rise to thirteen, versus thirty-four independently owned restaurants.

The irony here is Streetside Records is part of a chain of stores! 

I personally hate chain places, especially chain restaurants. We have so many wonderful locally owned establishments in our region, why go generic. That said, I’m not sure I believe in artificially creating such a cap. First, we must define a chain. Is locally owned Pasta House a “chain” because they have muliple locations? Do we distinquish between a locally owned & operated franchise (say a Subway) vs. a company owned store from a non-local national operator? The St. Louis Bread Co. is most definintely a chain — they had two locations at one time on the loop (disclosure: my investment club is a very minor shareholder in Panera).

The Loop is quite unique to the region but not just because of the mix of the stores & restaurants. The architecture and scale of the place is unique as well. I’ve been to the Noodles & Company at South County mall twice now and I can certainly say the experience is totally unlike going to the Loop. Sure, the food might be the same as well as the interior decor but the Loop still has the right feel I am looking for when I am out and about.

I personally am not a fan of regulating uses, my usual concern is building form which creates the feel of the public space (aka the street). Some franchise places have very strict standards on their signage & storefronts while others are more flexible, allowing adjustment for local flavor.

I think it should be noted “The Loop” is often considered that portion of Delmar in University City — up to the lions heads on the west end. However, over the last few years the portion of Delmar in the City of St. Louis has become quite interesting. I consider them together to be the Delmar Loop or simply the Loop, I never say the U-City Loop. But, it is the U-City portion feeling threatened by the influx of chain stores.

if the merchants want to be concerned about the character of the area and attracting people they need to look at doing something about the bad buildings such as this one:

These cars are all in for repair. Across the street, within the city limits, is another old gas station that has been boarded for years and the lot is simply used for additional parking.

At Skinker we have this horrible gas station, hardly a good anchor for a pedestrian district. The next rebuild should require the convenience store functions to be moved to the corner to create more urban context, leaving the pumps in the back less visible to the street.

The Church’s is no gem either. I believe these types of buildings, not their uses, do more to detract from the loop experience than the addition of a chain noodle shop in an urban building. I’d have not problems with the Church’s in a more urban building form sans drive-thru.

But let’s say you want to make sure you keep attracting the eclectic crowd, not minivans full of suburban families? The Loop merchants need to take a look at the street and see what is missing for their core market. Warning, this is morphing into a brief bike rack rant:

I stopped by the loop earlier today just to briefly snap a few pictures of the Streetside Records building and in the few minutes I was there I noticed four bicycles in front of several shops across the street.

Two parking meters, a sign post and finally a tree. Wait, what is that in the background? Yes, an old fashioned “dish drainer” style of bike rack. These are horrible, no wonder none of these cyclists decided to use it. First, it doesn’t look well secured — someone could steal the bike & rack. Second, when you put your front tire between the smaller vertical bars it can warp your front rim. Place your mountain bike tire in the wide opening and the bike easily falls over (I don’t think most of these bikes had kick stands). It also makes it hard to lock the frame securely – especially when using U-shape locks as the first three are. The Loop group needs to think about proper bike racks if they plan to keep their core customers.

But the debate really isn’t about chains, gas stations or even bike racks, it is about money. As owners of buildings decide to retire or when they die the buildings get sold for current market value. As such, new owers seek to recoup their investments with higher rents. Chain stores with deep pockets or local franchisee’s seeking to establish a business seek out thriving areas like the Loop.   Do places that can’t afford the newer rents need to think about relocating to other commercial districts in their price range? Of course, if many of the local places leave that will hurt the chains as well as they moved in because of the foot traffic the area generated. Areas can become so popular they hurt themselves.

The RFT article talks about a “tipping point” of having too many chains to the point where people stop coming because a place has become too generic. The problem is, in my view, is that is so hard to quantify. What number of chain restaurants or retailers is the right number? Is it simply quantity or a percentage of the streetfront or square footage? Maybe some retail experts have done some research but then I’d want to know who paid for the reseach.

My advice to the smaller local merchants: get a long term lease, buy your building, plan for higher rents in the future or think about options for new locations.

Reed’s Chief of Staff Owns Firm Located in Clayton

During the recent campaign for the President of the Board of Alderman opponents of incumbent Jim Shrewsbury made a big deal about his law practice being located in St. Louis County rather than the city.  Shrewsbury’s successor, Lewis Reed, has just named accountant and former campaign treasurer Thomas Shepard to be his Chief of Staff.  Interestingly, Shepard is the owner of an accounting firm located in Clayton:

Thomas Shepard & Associates, Inc. is a full-service certified public accounting firm, serving business and individuals for over fifteen years. We specialize in small business and employment tax issues. Located in Clayton, Missouri, we serve the entire St. Louis metropolitan area, as well as St. Charles and part of Illinois. 

Frankly, I like the idea of a Chief of Staff being an experienced business person and a CPA to boot.  As such, Shepard should be able to offer good guidance to Reed on various issues including complicated financial matters decided upon as one of the three members of the Board of Estimate & Apportionment (aka E&A).  But I have to wonder how Shepard’s time will be divided between running a long-standing accounting firm in Clayton and serving as a full-time Chief of Staff.

Success of SLU Arena Depends Upon Coachless Basketball Team

Today Saint Louis University fired head coach Brad Soderberg. SLU’s review of the team and lack of qualifiying for a tournament cost Soderberg the head coach job he has held for the last five years. But the disturbing part is how this relates to their new costly arena project, here is from a SLU statement:

Because the success of the new Chaifetz Arena is largely contingent on the success of the men’s basketball team, it is imperative that the team be led by a coach who we believe can establish a program that consistently vies for conference championships and engages in postseason play.

Wait a minute! SLU is building an $80 million dollar arena, just a couple of miles from the Scottrade Center downtown, with the success hinging on the men’s basketball team? Furthermore, at least $8 million in public subsidies in the form of TIF Financing (Tax Increment Financing) is going into this project resting in the hands of the team and an as yet to be hired new head coach. Well, I’m confident our “leaders” made the right decision.

Oh boy, has anybody told the bond holders on this project the old coach was fired because the team isn’t good enough to make the arena a success? That is kinda like all of SLU’s largely vacant parking garages — the success of them depends upon students, faculty and staff paying huge fees for parking passes. Ever wonder why SLU doesn’t support transit passes the way Washington University does? Follow the money, or debt in this case.

Mark my words folks, we’ve got another St. Louis boondoggle in the making!

April 17, 2007 – SLU Statement on Soderberg
February 19, 2007 – Urban Review Post on Legal Issues on TIF Financing
August 28, 2006 – SLU Press Release on Arena Ground Breaking

NY Times Blasts St. Louis on Population Decline and Crime

The NY Times has a highly negative article about St. Louis in their paper today.  From the article:

Population is a critical indicator of any city’s health, but the sinking numbers here are particularly unwelcome as the city has spiraled from one woe to the next.

In the past few months, the public schools were stripped of accreditation and taken over by the state; the city was designated the most dangerous in the country in a national crime survey; and 15 police officers and supervisors were disciplined for giving World Series tickets seized from scalpers to friends and family.

The writer got a few things wrong, including saying Lafayette Park rather than Lafayette Square.  Still, the message is the same.  Major population loss since the 1950s — old news really.  But she also looked at the dispute the city has had with the census since 2000.  In 2003 head city planner Rollin Stanley successfully argued that we had lost only 50 residents in the few years after the 2000 census.  Now the census is saying we are below where we were in 2000.  True or not?  Hard to say.  We’ll have a better clue after the 2010 census figures are released.

One thing is clear, and the NY Times article mentions this toward the end, we are not experiencing the massive losses of population as seen in prior decades.  The debate is if we have a small loss, breaking even or have a small gain.  Regardless, the question in my mind is why?  Have we simply hit rock bottom — that we’ve lost all we are going to lose?  Or have other factors such as shifting demographics, an influx of the “creative class”, or simply new immigrants helped offset continuing losses?  I don’t for a moment credit some great vision from city hall because they really don’t have one.

Read the full article here.

Rumor: Staff Positions for New President of the Board of Aldermen

Lewis Reed will be sworn in soon as the city’s next President of the Board of Aldermen, replacing Jim Shrewsbury in that role. That much we all know. What we have not yet heard is whom he will hire to the three staff positions to be filled within his office, including Chief of Staff.

One widespread rumor was 15th Ward Alderman Jennifer Florida for Chief of Staff but I’m hearing Florida will not get that job. However, I’m hearing Florida will take the second position as “Assistant to the President”, a job that pays more than current role of Alderman. Fifth Ward Alderman April Ford-Griffin is the name heard most often for Reed’s Chief of Staff. Both were early supporters of Reed’s candidacy.

If this rumor is true, and we will know within a week, that will leave two aldermanic seats open. The 5th ward is where large-scale land speculation is going on (aka Blairmont) and the 15th Ward had the long battle last year over a proposed McDonald’s. Both Florida and Ford-Griffin have been targets of unsuccessful recall attempts.