News

Palo Alto's brick-and-mortar retailers face steep challenges

Panelists cite online competition and difficult local business environment

Downtown Palo Alto stores are struggling with high costs, difficulties in finding employees who will work for minimum or low wage and a parking shortage, among other problems, a panel of business owners said Wednesday morning during a discussion on the future of retail.

Held in a vacant store on 217 Alma St. -- the former North Face outdoor-gear store -- the "Brick and Mortality" event was sponsored by the Palo Alto Downtown Business Association and Premier Properties Commercial Real Estate and included representatives from the City of Palo Alto, business owners, landlords and retail-trend spotters.

Lori Silverstein, CEO of Peninsula Beauty Supply, comes from a long line of retail owners -- her great-great-grandfather owned a department store on Market Street in San Francisco. She said she has seen many changes since opening her University Avenue store in 1982. Employees cannot afford parking permits, which are slated to rise to more than $700 a year in 2018. And combined with the high cost of living, lower-wage workers are heading for greener pastures.

"I lost my store manager to a job in an office paying $5 an hour more, and she doesn't have to work weekends," Silverstein said.

Peter Katz, owner of The Counter restaurants, has a location on California Avenue and others spread throughout the country, including 21 in California.

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The balance of brick-and-mortar retail and restaurants affects the viability of both types of businesses, he said -- and the loss of retailers harms dining establishments.

"Traditional retail and restaurants have a symbiotic relationship. If the mix goes out of balance one way or another, it's a problem," he said.

Both drive foot traffic to each other, with hungry shoppers looking for places to have lunch and diners stopping at stores to shop. In Palo Alto, the presence of too many restaurants is becoming an issue, and as a result, restaurants are having a hard time, he said.

Katz and Silverstein agreed that parking is also a problem for customers, which impacts the bottom line. Silverstein sees higher sales at her other store locations, where there is a good mix of retail and parking.

"My No. 1 store is in Redwood City at Sequoia Station. There is a lot of activity and it is near the train station," she said.

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In other locations, such as in Burlingame, parking is a challenge, but the Burlingame store is thriving because it is located with a better mix of stores to draw in customers, she said.

Wealthier communities such as Palo Alto can be a boon but are also fraught with hazards. In those locations, Silverstein must stock pricier brands to attract customers, but those brands mean "a huge investment. It costs more to get inventory that customers demand today," she said.

Katz and Silverstein said they face the obvious challenges from online retail and have adapted by making their products available on the internet, which has been lucrative. But now complications are creeping in.

Silverstein started a thriving, multimillion-dollar online store about 10 years ago. But sales have dropped as more retailers have started offering discounted products online. In addition, some suppliers don't allow her company to discount their products, but they give permission to Amazon to do so, she said.

New habits of the younger generation are also affecting how their businesses function, Katz and Silverstein said. Millennials grew up accustomed to rapid-service models, such as Amazon Prime.

Katz said that many younger people are foregoing the sit-down restaurant experience in favor of ordering online for pick up or delivery. He recently had a full dining room of 100 people and received five DoorDash orders.

“One was 29 entrees," he said, which puts a strain on staff members while they try to serve seated customers, who have priority.

Landlords and businesses also face the conundrum of how to get customers to stick around long enough to shop. Matt Taylor, senior leasing manager at Westfield Group, which owns and operates 35 shopping centers mainly in the U.S. and the United Kingdom, said that landlords and developers are looking at models that include entertainment and other amenities to draw in customers. Its Westfield Valley Fair shopping center in Santa Clara, for example, will have a $1.1 billion makeover that will include full-service restaurants and connect to Santana Row.

Katz noted that a proposed project at Stonestown Galleria in San Francisco would take out the Macy's and replace it with a movie theater, restaurants and a grocery store.

But while landlords often get a bad rap for "pushing out" or not leasing to a mix of retailers, the issue is more complicated, landlords and property-management company executives said.

Aaron Dan, managing director of retail brokerage Lockehouse Retail Group, Inc., said his company has 10 restaurant tenants, one fitness tenant and no traditional retailers in its portfolio, but that's because the interest from stores isn't there.

Jon Goldman, managing partner of Premier Properties, said 90 percent of the calls the company receives for potential leases are from restaurants. Fitness businesses are also clamoring to move in.

"There are very few interested retailers for soft-goods retail," he said.

Perhaps ironically, while traditional brick-and-mortar businesses have been fighting for their lives in the face of competition from online retailers, some large internet stores are looking to open stores. Amazon just opened a bookstore in Santana Row, Katz noted, and that model could further erode the presence of small retailers.

Betsy McGinn of McGinn eComm Consulting and Dan of Lockehouse Retail Group said businesses that succeed have specific targets or fill a specific consumer need. McGuinn, who consults with small companies and startup retailers, said some of her most successful clients, such as Warby Parker, which allow customers to choose eyeglass frames from the website to try on at home free of charge, and Dollar Shave Club, which mails razor blades each month at cheap prices, filled unmet needs by saving customers time and money.

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Palo Alto's brick-and-mortar retailers face steep challenges

Panelists cite online competition and difficult local business environment

by / Palo Alto Weekly

Uploaded: Wed, Jul 26, 2017, 10:45 pm

Downtown Palo Alto stores are struggling with high costs, difficulties in finding employees who will work for minimum or low wage and a parking shortage, among other problems, a panel of business owners said Wednesday morning during a discussion on the future of retail.

Held in a vacant store on 217 Alma St. -- the former North Face outdoor-gear store -- the "Brick and Mortality" event was sponsored by the Palo Alto Downtown Business Association and Premier Properties Commercial Real Estate and included representatives from the City of Palo Alto, business owners, landlords and retail-trend spotters.

Lori Silverstein, CEO of Peninsula Beauty Supply, comes from a long line of retail owners -- her great-great-grandfather owned a department store on Market Street in San Francisco. She said she has seen many changes since opening her University Avenue store in 1982. Employees cannot afford parking permits, which are slated to rise to more than $700 a year in 2018. And combined with the high cost of living, lower-wage workers are heading for greener pastures.

"I lost my store manager to a job in an office paying $5 an hour more, and she doesn't have to work weekends," Silverstein said.

Peter Katz, owner of The Counter restaurants, has a location on California Avenue and others spread throughout the country, including 21 in California.

The balance of brick-and-mortar retail and restaurants affects the viability of both types of businesses, he said -- and the loss of retailers harms dining establishments.

"Traditional retail and restaurants have a symbiotic relationship. If the mix goes out of balance one way or another, it's a problem," he said.

Both drive foot traffic to each other, with hungry shoppers looking for places to have lunch and diners stopping at stores to shop. In Palo Alto, the presence of too many restaurants is becoming an issue, and as a result, restaurants are having a hard time, he said.

Katz and Silverstein agreed that parking is also a problem for customers, which impacts the bottom line. Silverstein sees higher sales at her other store locations, where there is a good mix of retail and parking.

"My No. 1 store is in Redwood City at Sequoia Station. There is a lot of activity and it is near the train station," she said.

In other locations, such as in Burlingame, parking is a challenge, but the Burlingame store is thriving because it is located with a better mix of stores to draw in customers, she said.

Wealthier communities such as Palo Alto can be a boon but are also fraught with hazards. In those locations, Silverstein must stock pricier brands to attract customers, but those brands mean "a huge investment. It costs more to get inventory that customers demand today," she said.

Katz and Silverstein said they face the obvious challenges from online retail and have adapted by making their products available on the internet, which has been lucrative. But now complications are creeping in.

Silverstein started a thriving, multimillion-dollar online store about 10 years ago. But sales have dropped as more retailers have started offering discounted products online. In addition, some suppliers don't allow her company to discount their products, but they give permission to Amazon to do so, she said.

New habits of the younger generation are also affecting how their businesses function, Katz and Silverstein said. Millennials grew up accustomed to rapid-service models, such as Amazon Prime.

Katz said that many younger people are foregoing the sit-down restaurant experience in favor of ordering online for pick up or delivery. He recently had a full dining room of 100 people and received five DoorDash orders.

“One was 29 entrees," he said, which puts a strain on staff members while they try to serve seated customers, who have priority.

Landlords and businesses also face the conundrum of how to get customers to stick around long enough to shop. Matt Taylor, senior leasing manager at Westfield Group, which owns and operates 35 shopping centers mainly in the U.S. and the United Kingdom, said that landlords and developers are looking at models that include entertainment and other amenities to draw in customers. Its Westfield Valley Fair shopping center in Santa Clara, for example, will have a $1.1 billion makeover that will include full-service restaurants and connect to Santana Row.

Katz noted that a proposed project at Stonestown Galleria in San Francisco would take out the Macy's and replace it with a movie theater, restaurants and a grocery store.

But while landlords often get a bad rap for "pushing out" or not leasing to a mix of retailers, the issue is more complicated, landlords and property-management company executives said.

Aaron Dan, managing director of retail brokerage Lockehouse Retail Group, Inc., said his company has 10 restaurant tenants, one fitness tenant and no traditional retailers in its portfolio, but that's because the interest from stores isn't there.

Jon Goldman, managing partner of Premier Properties, said 90 percent of the calls the company receives for potential leases are from restaurants. Fitness businesses are also clamoring to move in.

"There are very few interested retailers for soft-goods retail," he said.

Perhaps ironically, while traditional brick-and-mortar businesses have been fighting for their lives in the face of competition from online retailers, some large internet stores are looking to open stores. Amazon just opened a bookstore in Santana Row, Katz noted, and that model could further erode the presence of small retailers.

Betsy McGinn of McGinn eComm Consulting and Dan of Lockehouse Retail Group said businesses that succeed have specific targets or fill a specific consumer need. McGuinn, who consults with small companies and startup retailers, said some of her most successful clients, such as Warby Parker, which allow customers to choose eyeglass frames from the website to try on at home free of charge, and Dollar Shave Club, which mails razor blades each month at cheap prices, filled unmet needs by saving customers time and money.

Comments

Resident
Another Palo Alto neighborhood
on Jul 27, 2017 at 7:03 pm
Resident, Another Palo Alto neighborhood
on Jul 27, 2017 at 7:03 pm

This is what we have been saying and the City ignores us. We need better parking for all in Palo Alto. All this trying to stop traffic means workers don't want to work downtown and shopper don't want to shop. We need a parking policy, not an anti-parking policy.


resident
Old Palo Alto
on Jul 27, 2017 at 7:22 pm
resident, Old Palo Alto
on Jul 27, 2017 at 7:22 pm

The problem is all the tech offices moving into downtown. They take up all the parking spaces and reduce the mix of retail stores that draws in customers. Maybe this was a good idea during the Bush recession, but can we kick them out now that the economy has recovered? Yes, retail businesses pay lower rents than tech offices to landlords will have to take a hit, but they've made enough money by now, haven't they?


Quon Lee
Midtown
on Jul 27, 2017 at 9:48 pm
Quon Lee, Midtown
on Jul 27, 2017 at 9:48 pm
Bob
Downtown North
on Jul 28, 2017 at 9:45 am
Bob, Downtown North
on Jul 28, 2017 at 9:45 am

Studies have shown that the majority of office workers use public transportation to get to Palo Alto. Clearly office workers are not using parking spaces. In fact, it is the office workers who are in large part supporting the restaurants and retailers downtown. This forum, if you were in attendance, was not about parking it was about how retailers are facing increased competition from the internet and how difficult it is to compete against people buying on line.


Online Name
Registered user
Embarcadero Oaks/Leland
on Jul 28, 2017 at 11:35 am
Online Name, Embarcadero Oaks/Leland
Registered user
on Jul 28, 2017 at 11:35 am

@Bob, With commuters outnumbering residents 4:1 and Palo Alto already paying carpooling expenses for 1,000 commuters for this NEW program, your claim that all the constantly growing number of commuters don't need parking spaces doesn't make a lot of sense. If they don't need parking spaces, why is the city paying a small fortunate to build more garages and to institute RPP?

So tired of PA becoming an office park while decimating businesses like retail and professional services (medical, dental, finance, accounting, insurance) to make serve the needs of big employers like Palantir that now dominate downtown.


Shame on them
Community Center
on Jul 28, 2017 at 11:41 am
Shame on them, Community Center
on Jul 28, 2017 at 11:41 am

The daily post had a much better ad more In depth article covering this story. Bob is correct that the issue is Internet competetion. Palo alto seems to ignore this very pertinent matter. All we hear about is protecting local retail and mom and pop stores. Elected officials ignore the issue of competetion. I next effect the council to propose a bill banning online shopping for palo alto residents.


resident
Old Palo Alto
on Jul 28, 2017 at 12:23 pm
resident, Old Palo Alto
on Jul 28, 2017 at 12:23 pm

Parking along University Ave is always full, yet stores and restaurants are struggling. If workers aren't hogging all the parking spaces, then who's cars are those? Just window shopping?


Need more 30 minute parking
Registered user
Duveneck/St. Francis
on Jul 28, 2017 at 12:27 pm
Need more 30 minute parking, Duveneck/St. Francis
Registered user
on Jul 28, 2017 at 12:27 pm

If there were more 30 minute parking spots downtown, there would be more open spots. Lots of workers move their car every two hours to avoid paying for parking. More 30 minute spots would allow enough time to do a few errands, bringing more business to downtown. Business that hire minimum or low wage employees should provide them with parking passes.


shopping downtown
Crescent Park
on Jul 28, 2017 at 3:01 pm
shopping downtown, Crescent Park
on Jul 28, 2017 at 3:01 pm

There are several trends that I have noticed over the years since the great recession.

1) Downtown Palo Alto has become more favorable to becoming an office park. I miss the days when it was a beautiful place where brilliant minds could gather and share ideas without limitations on parking or traffic conflicts. It was a great place for everyone to hang out.

2) Retail spaces are now taken up by multi-level office buildings. Palo Alto generates more revenue from taxes when new buildings are built. The taxes and the amount of rent charged gets reset when a new building is constructed on previous single level buildings.

3) Mom and Pop stores/businesses that have been there for decades are now being squeezed out. People who dedicated their entire lives to building a business and community are hurting because of excessive rent increases.

4) Parking restrictions are forcing people to go elsewhere. It is no longer a place for people to casually gather unless you are already there.

All these things make it difficult for retailers and restaurants to survive. It feels like downtown Palo Alto is changing to be more of an office park and not a community center. I understand the need for renewal and change, but miss the days when Palo Alto was more hospitable to retailers and restaurants. I think things will only get more difficult for all businesses and offices downtown as road/cable construction will occur over the next several years. This will be noisy and irritating for everyone in the downtown area.


mauricio
Registered user
Embarcadero Oaks/Leland
on Jul 28, 2017 at 5:17 pm
mauricio, Embarcadero Oaks/Leland
Registered user
on Jul 28, 2017 at 5:17 pm

Downtown IS an office park. No small retailer can compete with well financed start ups. Downtown should have been zoned only for small retail and restaurants, not allowing tech companies and fake retail any foothold. Tech firms can pay any extortionist rent, so there is no competition. tHE "vibrancy" Liz Kniss has been pushing for so may years is really the death sentence of Palo Alto as a suburban small town with big quality of life. It is now an office park and it will be Manhattanized in a fairly short time.


Shame on them
Community Center
on Jul 28, 2017 at 6:35 pm
Shame on them, Community Center
on Jul 28, 2017 at 6:35 pm

Parking, parking, parking. That is the only thing people seem to be harping about. The real issue is internet shopping ( covered in more detail in the daily post story). This morning they were talking About mall traffic being down due to the internet and that only a small percentage of mall's are doing well. Of course parking and complaining about palantir is what the weekly likes. The weekly, the council and some residents have their heads in the ground when it comes to the real issues facing retail in palo alto. The council can mandate retail, no chain stores and other lip service, but people will increase their online shopping at the expense of brick and mortar.


Long Time Resident
Old Palo Alto
on Jul 28, 2017 at 7:18 pm
Long Time Resident, Old Palo Alto
on Jul 28, 2017 at 7:18 pm

I shop on the internet to avoid getting stuck in a traffic jam and trying to find a parking spot. The two are related.

We are over-populated.


john_alderman
Registered user
Crescent Park
on Jul 28, 2017 at 7:40 pm
john_alderman, Crescent Park
Registered user
on Jul 28, 2017 at 7:40 pm

@Bob - "Studies have shown that the majority of office workers use public transportation"

This is false.

The 2016 Palo Alto Transportation Management Association study showed only 31% of "Tech Workers" downtown used public transportation. If you look at "Light Office" workers, 74% drive alone and only 14% take public transportation. For service workers it is 80% drive alone, 3% take public transportation.

Note the study was limited to downtown only, so include Stanford Research Park and other areas and the numbers will look even worse for public transportation.


Todd
Another Palo Alto neighborhood
on Jul 28, 2017 at 7:42 pm
Todd, Another Palo Alto neighborhood
on Jul 28, 2017 at 7:42 pm

Obviously this has nothing to do with a labor shortage amongst those willing to work for retail wages...


Resident
Another Palo Alto neighborhood
on Jul 28, 2017 at 8:17 pm
Resident, Another Palo Alto neighborhood
on Jul 28, 2017 at 8:17 pm

I tend to prefer brick and mortar stores for most items. I call around and walk from store to store at Stanford.

The last occasional item I needed I walked around Stanford asking in several department stores and not only did they say they didn't have the item, they weren't even interested in looking to see if they could order it or help me in any way. The only alternative was to buy it online where I had several choices.

This is not the first time that I have noticed choices being limited in stores. The reason I end up buying online is because I can't get them in stores.

We do not want stores that keep selling the same merchandise as each other. We do need to have stores that are selling hard to find, but necessary, items as well as helping customers to order online from their particular online store and then get them for future customers!


Get Serious
Ventura
on Jul 28, 2017 at 8:24 pm
Get Serious, Ventura
on Jul 28, 2017 at 8:24 pm

Employees of many companies receive mass transit benefits if they claim to commute using them. In my experience, very few do. The companies also receive financial benefits based on claims of commute use of mass transit.

For these reasons, surveys of employees of such companies are highly suspect.


Shame on them
Community Center
on Jul 28, 2017 at 8:35 pm
Shame on them, Community Center
on Jul 28, 2017 at 8:35 pm

Okay, get serious, I will bite. What is your experience with tech workers and how they commute? How many of these workers di you know? Get serious claim Is another inn a long line of unproven factoids that are a hallmark of comments on this forum


Online Name
Registered user
Embarcadero Oaks/Leland
on Jul 28, 2017 at 9:12 pm
Online Name, Embarcadero Oaks/Leland
Registered user
on Jul 28, 2017 at 9:12 pm

@John Alderman, thanks for posting accurate figures on the commuters. If annual downtown parking permits cost $700, that amount is huge for someone making minimum wage as a retail clerk or a relatively low salary in a medical / dental office but it's a mere pittance to the tech workers with their $100K sign-on bonuses and their 6-figure salaries.

Big-company employers should be picking up the tab for their employees, not making US, the residents pick up the tab by building them new garages and paying their commuting expenses. They should NOT be discouraging residents from shopping downtown to accommodate them!

For decades Google has been providing its employees with free bus service from Hayward, SF etc. etc. but here in Palo Alto we have a transportation commission chaired by a Palantir employee who's decided PA should do the reverse and have the residents subsidize their employees. Ludicrous.


easong
another community
on Jul 30, 2017 at 9:26 am
easong, another community
on Jul 30, 2017 at 9:26 am

I visit downtown for lunch once or twice a week. Parking is tough from about 11:45-1:15, so I avoid that period. Talking to the wait staff at my regular spots, their biggest problem is parking. They aren't taking Caltrain to work because affordable rents are not found near the Caltrain line. Palo Alto should issue a certain number of employee parking permits to restaurant owners. Otherwise the changing demographics of Redwood City and Sunnyvale will steal these workers away.


RetailBoom
College Terrace
on Jul 30, 2017 at 11:51 am
RetailBoom, College Terrace
on Jul 30, 2017 at 11:51 am

Googl around. Several reports out recently about how retail is booming. The nature of retail is changing to be more an experience but it's doing well across the country. Exceptmfor big box retail. Crating a retail environment is key. As stated in the article you need a balance of restaurants and retail, easy access and parking. And landlords who are prevented from charging office rates for retail locations.


john_alderman
Registered user
Crescent Park
on Jul 30, 2017 at 12:23 pm
john_alderman, Crescent Park
Registered user
on Jul 30, 2017 at 12:23 pm

Online retail is still only ~10% of the retail market. Just look at the ever crowded Stanford Shopping Center to see that there is still life in brack and mortar. The problem downtown is that too much has been ceded to offices, which displaces retail, and squeezes parking, both of which drive down customer traffic, which in turn makes it even harder to survive as a retailer. It is a self inflicted death spiral.


Property Owner
Downtown North
on Jul 31, 2017 at 5:41 am
Property Owner, Downtown North
on Jul 31, 2017 at 5:41 am

So, btw, Online Name...the following businesses that you mention in your comment that are being squeezed out " professional services (medical, dental, finance, accounting, insurance)" don't qualify as retail in the ordinance to save retail.


dtnorth
Downtown North
on Aug 1, 2017 at 12:22 pm
dtnorth, Downtown North
on Aug 1, 2017 at 12:22 pm

I agree with @shopping downtown. I have lived here for 40 years and we had a business downtown. The years when we had a business in downtown we had lack of parking back then. There were a lot more retail business that is for sure. I now live downtown and I prefer to go into redwood city and downtown los altos as they have a lot more retail stores to peruse. With that said Redwood city is also changing and retail is leaving and office buildings going up. Exactly what is killing Palo Alto. WE are allowing our downtown to become office parks. We are having small 2 stories getting torn down to make room for their 4 story bldgs. Maybe we can get them to give the retail a better price per square ft. I do know of some bldg owner that do that for the small business


Gale Johnson
Adobe-Meadow
on Aug 1, 2017 at 2:04 pm
Gale Johnson, Adobe-Meadow
on Aug 1, 2017 at 2:04 pm

@resident...re comment "but they've made enough money by now, haven't they?" Of course not...what is enough money to property owners/developers who can get max rents from tech companies without a blink? They never make enough money. They are so profit driven they would never consider giving a retail business a break because they don't have to. Rent rates and the parking issue is just part of the problem of keeping retail in downtown. The biggest cause of vacancies, that will never be filled, is the online shopping and the outdoor malls that are doing very well, e.g., Stanford Shopping Center.

I remember those good old days of yore, having lived here since 1961. All the little mom and pop stores, music stores, five and dimes, book stores, toy stores, hardware stores, florists, family owned department stores...those "manly" stores...Bergman's, Weideman's, and Harriman's. We bought a lot of clothes and many other things in those stores, but they are gone forever, and they will never be replaced. Got to adjust to the new ways. And a butcher shop on California Ave. I really liked the owner. He carved up meat, beef cut to our specifications...and you could buy big bags of rice there also.

I better stop before I start tearing up. Those days are gone forever, never to return, so I can only offer my memories of them in words. That's why I'm enrolled in a 'Life Stories' writing class at Avenidas, and write about them.


Gale Johnson
Adobe-Meadow
on Aug 1, 2017 at 2:22 pm
Gale Johnson, Adobe-Meadow
on Aug 1, 2017 at 2:22 pm

Thanks john_alderman...for your research and setting the record straight on the transportation/parking habits of workers in PA. Bob was just popping off I think, with his off the cuff comments and with his personal views buried deeply in them, but lacking any facts to support it. Thanks for your challenge. Awaiting his response, but I won't wait very long because I don't think he has one. lol!


margaret heath
College Terrace
on Aug 1, 2017 at 5:07 pm
margaret heath, College Terrace
on Aug 1, 2017 at 5:07 pm

During one of the council discussions regarding whether it was necessary for the council to take action to support downtown retail, council member Liz Kniss told us that she had visited downtown to see how it was doing. Her opinion following that visit was that downtown was doing just fine, and in her opinion the council did not need to get further involved to protect retail. "If it ain't broke, why fix it?" In other words, as far as Palo Alto retail and neighborhood serving businesses are concerned, the council should be hands-off. After all, why close the barn door before the horse has bolted. Although councilmember Kniss has declared, she is "pro-prosperity" her "hands-off" approach over the years has appeared to favor large commercial property landlords and developers over smaller businesses. Unfortunately, apart from Stanford Shopping Center and Town and Country Village, retail and neighborhood serving businesses are disappearing and it's now probably too little too late to do anything about it.


Joe retail
Downtown North
on Aug 1, 2017 at 10:01 pm
Joe retail, Downtown North
on Aug 1, 2017 at 10:01 pm

Working the market for years there is no doubt that the high rents and limited ground floor space play a part in pushing out low sales volumes type stores. Supply and demand plays the largest part. While low performing stores closing is a 'natural' event per se at some point the closing is hastened dramatically by high occupancy costs. High costs also are prohibitive for low sales volume retailers - music stores can't make it but the right apparel and shoestores can make it. Food and beverage can. food and beverage operators are facing dramatically increasing bottom line costs, finding it hard to keep employees among high rents and in a desirable market , stiff competition as well. Retail is changing dramatically but brick and mortar is not dead in anyway. Retail itself as we have known it for literally hundreds of years is changing. Retail must be significant - must differentiate and offer an experience. Department stores are dying yes, but they all sell the same things- khakis and polo shirts and boxers and socks. Don't forget they used to sell unique goods - hunting and fishing equipment - tools - etc. instead of what they are know - Low price super sales to their customers. Retailers that are dying now in many ways have killed them selves in the rush to sell at all costs - foregoing why many shop in the first place - to find something special - to see something new - to taste something different. That will never change and retailers that address this are thriving - ironically many are coming FROM online. Compound above with yes, limited parking, competition from office users downtown, there are challenges. Parking and office users absolutely affect the success of retailers however. Can't argue it. No doubt P.A allowed too many office users to locate in ground floor space. Also salons, fitness and other personal services are by enlarge banned from university. If you ever think there are too many of a certain retailer on a block 99% of the time it's the zoning. You can thank your local council and planning for that.


margaret heath
College Terrace
on Aug 2, 2017 at 1:30 pm
margaret heath, College Terrace
on Aug 2, 2017 at 1:30 pm

"Also salons, fitness and other personal services are by enlarge banned from university. "

Councilmember Kniss talked specifically about continuing to allow salons and fitness continue to be included on the list of allowed uses in the retail zoning. Hence the unattractive one-on-one fitness training studio that replaced the Village Stationers on the corner of California Avenue and Birch is an allowed use. Although with one-on-one fitness training it brings in minimal foot traffic for the large retail space on California Avenue it occupies. Kniss urged the council not to remove fitness studios from the list of allowed uses because fitness studios like those offering yoga classes bring in so many people.


Gale Johnson
Adobe-Meadow
on Aug 2, 2017 at 2:44 pm
Gale Johnson, Adobe-Meadow
on Aug 2, 2017 at 2:44 pm

What draws new retail is older and current retail that is surviving and thriving. Business owners see others succeed and so they are willing to try it in those locations. Doesn't always work out because of what is offered.


Me 2
Old Palo Alto
on Aug 3, 2017 at 8:15 am
Me 2, Old Palo Alto
on Aug 3, 2017 at 8:15 am

More retail desired, yet we all pass a punishing minimum wage law?

That's called shooting yourself in the foot.


Long time resident
Crescent Park
on Aug 4, 2017 at 7:54 am
Long time resident, Crescent Park
on Aug 4, 2017 at 7:54 am

Retail--in general--seems doomed in PA, especially downtown. Here's an anecdote that exemplifies the situation.

I needed an item, and I walked downtown to at least window shop, if not purchase, what I needed. I found the item in a Univ. Ave. retail store, yet hesitated because the price seemed high. And yes, a smartphone search confirmed that.

At home in the evening, I found the identical item (same brand, exactly the same item) from a business who distributes through Amazon for 1/3 of the PA retailer's price. Delivery in 2 days, or delivery tomorrow for a few dollars more.

Sorry, I pass on 300% more to shop locally.


john_alderman
Registered user
Crescent Park
on Aug 4, 2017 at 4:00 pm
john_alderman, Crescent Park
Registered user
on Aug 4, 2017 at 4:00 pm

@Long time resident - would you share what the item was? 300% premium for retail vs online seems like an outlier.


MP Resident
Menlo Park
on Aug 4, 2017 at 5:01 pm
MP Resident, Menlo Park
on Aug 4, 2017 at 5:01 pm

300% actually seems about right for smaller items. Try buying something like a HDMI cable locally - it's all the "monster cable" type rip-offs, that sort of thing.

Local retail is useful when it comes with a service (e.g. bike shop with fitting and repair), restaurants, food (fresh food is hard to do well online), shoes (with fitting, though you can always buy more from Zappos), or things you need *now* (e.g. drug stores, hardware stores).

Otherwise, it's a dinosaur. Online may be 10% of the volume, I would wager it's a much higher percentage of the profits. Most retail help is useless, stock-outs are common, and prices 3x Amazon are not at all unheard of. I don't buy clothing locally, electronics are easier online, kitchenware is much easier online, and nobody really needs that much furniture (despite what the Menlo Park planners seem to think). I do occasionally go to Stanford Mall for the restaurants, but generally nothing else.

Pushing for more unnecessary retail when we already have far more retail per person than anywhere else in the world is some cross between wishful thinking and trying to bring back a past that isn't coming back.


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