Jeff Edelstein, Roadside Development LLC
No longer do “food by the pound” cafes dominate fast casual lunch options, or tired steak houses fill the nights. A young generation of award winning chefs — the likes of Mike Isabella, Cedric Maupillier and Aaron Silverman — are driving a new culinary scene, which in turn is helping to boost retail growth across our city. Silverman’s Rose’s Luxury across from the Marine Barracks on Capitol Hill was just named 2014 best new restaurant in the country by Bon Appetit.
With a population of less than 700,000, D.C. is still a relatively small city, but it doesn’t act like it. It is the focus of the nation’s — and the world’s — political eye. It is also blessed with a stable economy and the recent influx of a younger generation who seek to put their stamp on it. We are no longer just a government town. International corporations like Hilton, Marriott, Choice, and Host Hotels have chosen this market for their headquarters. Discovery and Travel channels have staked their claims here as well, and the tech industry is following suit.
The once formulaic retail sprawl shifting east from Georgetown has slowed. Today, D.C. retail is like a pinball bouncing unpredictably around our city. From the hipster-centric H Street N.E., which will soon have a Whole Foods, to the boom of 14th Street N.W., the pinball enlivens neighborhoods wherever it stops. And, with new neighborhoods popping up, the metro is expanding its boundaries for what and where we eat, shop and play.
But as we move forward, we must ask ourselves, what is our essential character, our sweet spot? What’s authentic to D.C. retail and culture? What do we have that other cities, domestic and international, will want to emulate? The answer may not be fully defined yet, but we are getting close.
That answer lies in neighborhoods like 14th Street N.W. and Shaw. Just a few years ago, these neighborhoods, devastated by the 1968 riots, were lined with warehouses, abandoned storefronts, dilapidated houses and liquor stores with bulletproof glass. Why are they taking off now? Because they have retained something that doesn’t exist in the suburbs that encompassed the majority of the retail growth for the last couple of decades. These neighborhoods have benefitted from boasting great scale and architecture and the vision of pioneering local developers like the legendary Douglas Jemal, who exhibited the market to national players. Jemal and others like him saw the beauty in a neighborhood that was once home to Duke Ellington and other famous jazz musicians. Walk the streets today and you’ll see award-winning residential developments, lively restaurants and local, regional, national, and now international retailers such as Lululemon. Room and Board planted its flag in the heart of the neighborhood, followed by West Elm and others with an eye on opportunity.
What has happened in some of these neighborhoods has proven that the city is looking to grow and that the next generation is pushing it beyond its traditional boundaries. DC Brau Brewing Co. kicked off a microbrew revolution in D.C. in 2009, and the city is now home to more an assortment of breweries and distilleries. Several have taken up shop in abandoned warehouses on the fringe of the city well beyond the beaten path. Their success, and their customers’ desire for that authentic and unique draw, has made others follow.
This recognition of the value of the city’s character has pushed suburban markets out of their traditional comfort zones. New Lifestyle Centers are being designed like urban villages, with buildings no longer constructed of plain brick. Woods, metals, and other materials have found their way out of the city to give a soul to these newer centers. In addition, increased density along our mass transit system has spurred the razing of power centers and the creation of small urban oases outside the city. Federal Realty pioneered this concept, and continues to do so with their Pike & Rose development in North Bethesda, Maryland.
What does this tell us about the retail outlook for D.C.? There is no doubt that our city has spending power and international influence, as evidenced in the recently opened CityCenterDC developed by Hines. Hines has brought in the who’s who in lux fashion with Hermes, Hugo Boss, Burberry and Longchamp.
However, while projects such as this are vital and exciting, they should not be all that defines the retail of our nation’s capital. Moving forward, we also need to build on our history, and to create retail that is authentic and uniquely D.C. Our city is finally ready for others to take note and imitate.
— Jeff Edelstein, Partner, Roadside Development LLC. This article originally appeared in the November issue of Southeast Real Estate Business.