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Scott Wallis tried to play it cool when Kevin Spacey walked into his store. He acted as if Spacey was any other customer at his men’s apparel boutique Avenue Jack. “He spent $1,400,” says Wallis.
Months later, after Wallis decided to close his Connecticut Avenue store, Spacey returned. “You’re closing?” asked Spacey. “But this is my favorite store in D.C.”
Spacey isn’t the only person who adored Avenue Jack. In the 21 months of the store’s existence, Wallis’ gem of a boutique received multiple accolades, including positive write-ups in Washingtonian, The Washington Post, and a “Best of” Award from City Paper. Wallis even made the cover of Metro Weekly, with pages of glossy photographs of his store and products.
“I thought the support we got and the press we got was phenomenal,” he says.
Yet even with all the favorable buzz, Wallis found himself facing the hard reality of keeping a retail space open in D.C. Monthly rent cost him an astonishing $13,000 for 2,000 square feet of floor space. His revenues were up but not significantly. The lack of foot traffic on his part of Connecticut Avenue impacted sales, and his business was hurting. So he made the hard decision to close his doors in early January.
“I knew what the rents were,” he says. “I really thought we could cover it because I thought we would get the traffic.”
Wallis is just one casualty of a larger problem in D.C. and indeed nationwide. Independent businesses are disappearing. A combination of high rents, an infusion of chain stores, and a swayed consumer base that would rather shop at Amazon are all contributing to a retail squeeze-out, leaving businesses struggling to keep afloat in the District and beyond.
Though the city has made efforts to promote arts and independent retail, originality has often given way to real estate development. A program called Made in D.C., designed to support independent makers and craftspeople who want to sell their wares, is the city’s latest effort. But the current circumstances are rooted in a much longer narrative that is steeped in D.C.’s history. To understand what’s happening, we have to start with U Street in the 1980s.
To take a leisurely stroll down U or 14th Street NW today is fun and engaging, with a wide variety of places to eat, shop, and even buy groceries.
The U Street corridor used to be a very different neighborhood. Martin Luther King Jr.’s assassination in 1968 set off riots that devastated businesses on 14th and U Streets, and in their aftermath the neighborhood steadily declined. By the late 1980s, crime was up. Stores had bars on their windows. The area was home to a license plate factory, used car lots, and was known as much for prostitution as anything else.
But then-Mayor Marion Barry Jr. had a plan. His vision for U Street involved restoring the corridor to its previous grandeur. Before the riots, the neighborhood was known as “Black Broadway” and was a cultural destination within the African-American community. Barry wanted to revive it. So he set out to rezone it to become the Uptown Arts Overlay, purposefully designed as a hub for artists, retail, and restaurants.
The neighborhood was also getting the infrastructure necessary to jumpstart change. A Metro station was under construction that would eventually become U Street/African-American Civil War Memorial/Cardozo. Barry decided to put a large government building called the Frank D. Reeves Municipal Center smack in the middle of the corridor. It opened on the corner of U and 14th with hopes that it would drive daytime traffic and anchor the neighborhood.
There was a grand design. Between retail, proposed artist lofts and galleries, restaurants, and nighttime entertainment, the overarching goal was to create an 18-hour flurry of activity in the area. The city’s main goals were to expand businesses, and thus job opportunities, and to increase housing “in a variety of rent and price ranges.”
It was a bold vision. It seemed unlikely—even impossible— for the city’s plan to come to fruition. But it did work. Perhaps too well.
The creation of a new, arts-dedicated U Street corridor was a fight. Not everyone was behind a rezoning project that would return the area to its former glory while simultaneously creating a shopping destination. Long-term residents were concerned that the area would grow so much that they would be priced out of the neighborhood. Critics argued that store rents would skyrocket and that the natural charm of the area would be overshadowed by real estate developers more loyal to their investors than the neighborhood’s residents or any municipal plan.
The city commissioned studies to look at the viability of pouring money into creating a new U Street, producing a list of “preferred uses” for the area. This list included galleries, artist housing, museums, art stores, retail, and dining.
Now, some three decades later, restaurants occupy a large portion of the ground floor space on both 14th and U Streets. Take those out, and most of what’s left are chain stores. Independent stores make up a slim portion of the larger whole. Of those, a number have closed in the last year, including Universal Gear, Timothy Paul Home, and Rosies & Rockers. Very little about greater U Street qualifies it as an arts destination.
The city-commissioned studies of the late 1980s made the area sound like an artistic utopia. But the city also realized what change could come. A 1988 study by the D.C. Office of Planning stated: “Neighborhood retail uses need some preferred status in order to avoid being priced out of the area by other, potentially more profitable uses, and by redevelopment generally.” The document cautioned that as the area became profitable, it would “simply price out the preferred uses.”
When Pixie Windsor, otherwise known as Miss Pixie, first moved to 14th Street in 2008, there were still riot bars on the windows of her store. Her namesake furniture shop had already been open in Adams Morgan for more than a decade when she decided to move to the bigger space.
It was a transitional time in 14th Street history. It felt like the plans for new retail detailed in city reports two decades earlier were finally coming to fruition. More restaurants were opening, and there was an unofficial “furniture row” that included other independent stores. The rent for her 4,000-square-foot space was $6,500 a month and included a coffee shop space upstairs that was rented to another independent vendor.
Now, nine years later, her monthly rent has increased to $16,701.47. If there is a property tax increase, the cost will be passed directly on to her.
Her store is part estate sale, part installation art project. Walk through Miss Pixie’s and you might encounter a full silverware set, a cobbler’s bench that doubles as a coffee table, a series of busts wearing sunglasses, and a set of martini glasses. The store offers home goods that provide space solutions (dressers! tables! bar carts!), all of which she has carefully selected.
This is the shop for when the sea of furnishings made of particleboard has exhausted your spirit. It also errs on the side of the whimsical—if it’s possible for a piece of furniture to have a sense of humor, it ends up at Miss Pixie’s.
In the same period, though, chain store giants—West Elm, Room & Board, Madewell, Shinola, and J. Crew Men’s—have opened around her. Meanwhile, independent stores Rckndy, Muléh, Ruff & Ready Furnishings, And Beige, Mara Home, Vastu, and Millennium Decorative Arts have all folded.
And furniture row? Its existence is tenuous at best. Miss Pixie’s is one of the last independent places remaining.
A box store can absorb a slow season, counting on a parent company to make up the rent. But that same down quarter can spell the end for independents that are shouldering the entire cost of their inventory and operations.
In short, it’s hard to keep up with multimillion-dollar corporations.
Retail as a whole is in a full-fledged national nosedive—to the point that experts are calling it a “retail apocalypse.” The U.S. Bureau of Labor and Statistics reported that 65,000 retail jobs were lost in February and March alone. In the first quarter of 2017, Macy’s, Sears, The Limited, J.C. Penney, Abercrombie & Fitch, BCBG Max Azria, Wet Seal, Rue 21, Agent Provocateur, Kit and Ace, and Payless all announced store closings.
While large stores restructure debt and scramble to figure out if there is life beyond a brick-and-mortar experience, small businesses take direct hits on the viability of staying open in a wobbly shopping economy.
U Street serves as a microcosm of these broader problems. But what no one could have possibly imagined in the late 1980s was shopping via home computers. Specifically, D.C. leadership couldn’t have projected that one online store would change the entire retail landscape a few decades on.
“My competition isn’t in my neighborhood. My competition is Amazon,” says Leah Daniels, who opened her kitchen store, Hill’s Kitchen, in a townhouse in Eastern Market in 2008. Her shop is a delight both for skilled home chefs and for people who would rather watch Top Chef while eating takeout. It carries cookbooks, holiday cookware, pots and pans, and appliances.
Daniels prides herself on a warm, personalized shopping interaction with her customers. A typical day involves recommending items, talking about food, and catching up on how her regulars are doing as they pop in before hosting dinner parties.
A few years ago, she realized that her customers were shopping online while in her store. “Lots of people stand in the store and look on their phones on Amazon,” she says. “They don’t understand that it’s a gut punch for me.”
Shopping on Amazon for the lowest prices is a now a common practice. The cost of any merchandise in existence is only a quick search away. A membership with Amazon Prime and sophisticated supply chain logistics make it easy to tap a few buttons and—sometimes within one day—receive goods. It’s a deal that’s hard to beat.
Jaye Langmaid, owner of furniture and design store Hudson & Crane on Florida Avenue NW near U Street, says his customers also shop this way. His store is one of only a handful of independent D.C. retailers that have expanded in the last year. Yet part of his overall business concern is how to deal with customers shopping online while they are standing inside his space.
Take, for example, a rug. Langmaid sells a variety of them in his store and has seen customers turn over a corner of one, take a picture of the label, then walk out. The implication is that the shopper liked the rug and wants to purchase it. Just not from him.
Customers are using stores as staging areas. They want to look at a product, touch it, and make sure they like the color. Then they purchase it online—probably for a little less. It’s hard to compete with an online company that can purchase 10,000 units of the same product, hold them in a warehouse, and thus undercut the price just enough to flatline competition.
Without his store, customers wouldn’t have the same depth of understanding about what they are purchasing. “That’s the biggest problem—value perception,” Langmaid says. Part of his job, he explains, is thinking about how to navigate the Amazon reality while helping consumers understand the value of being able to walk into a brick and mortar to look at products.
Hudson & Crane doesn’t have sales associates. Instead, Langmaid hires interior designers. The value of buying a rug from his independent store is that employees can help customers solve problems with specific expertise that goes way beyond an internet search.
“If people want, in 10 years, to have a shopping experience, they can’t just come in and browse. They have to be spending their money,” says Langmaid. “The big boxes coming in and Amazon are the death of retail.”
When products are purchased locally, 68 cents of every dollar stays within the D.C. economy, compared to the 43 cents that stays in the community when items are purchased at box stores or online. Shopping locally creates local jobs and an economic boost.
“Where you are shopping and how you are buying impacts things,” Langmaid says.
The District’s latest answer to supporting independent retail and artists is a program called Made in D.C. In May 2016, Councilmember Charles Allen pushed Made in D.C. legislation into law, an earnest effort to support and promote the city’s makers and artists as well as the stores that sell their products. It also was a means to depict a city with a robust small business scene.
“One of the things most worrying for me is, how are we going to keep the businesses who stuck it out through the hard times?” says Ana Harvey, director of the D.C. Department of Small and Local Business Development, where the Made in D.C. program is housed.
When the program was established last year, its entire budget funded two full-time positions in Harvey’s office. Dedicating government staff to support a small business program focused on independent makers is no small feat. Yet one year later, neither position has been filled.
Placing the Made in D.C. program in the Department of Small and Local Business Development is a statement within itself—signaling that local government understands the importance of art and handmade retail. Yet setting aside positions is different than retaining a fully funded program. Made in D.C. relies heavily on leveraging partnerships to bring programs and tools to small business owners.
This dependence on partnerships or outside funding mirrors how D.C. is managing the reality of disappearing independent retail. The 1980s U Street concept of promoting retailers and artists was centered on a physical location in Northwest. Made in D.C. backs the notion of brick-and-mortar but also acknowledges that securing physical space within the city is very difficult. The program asks developers to include local business as part of their overarching project plans. “Incentives are the way,” says Harvey. “They aren’t fleshed out yet.”
“The availability of creative space that is affordable is also going to be a part of Made in D.C.,” Mayor Muriel Bowser told an excited crowd of local business owners the day she signed the Made in D.C. bill.
But a majority of the participating makers are working out of their basements, in spare rooms, and in small corners of shared spaces. (Food manufacturers fall into a different category because D.C. requires spaces that adhere to food safety laws. Food businesses also have the added relief of not needing foot traffic to sell products.)
This is a far cry from the original vision of building a city that widely supports its makers through retail spaces. The reality is that the city is relying heavily on private developers to support local retailers. Harvey acknowledges that the city is in talks with developers to offer incentives for creating affordable retail space within up-and-coming properties.
Partnering with developers provides a short-term solution to a high-rent problem. But it also leaves independent retailers at the mercy of real estate owners to prop up physical business. While Made in D.C. is out to prove that the District is more than just a city of lobbyists, the retailers are relying on the concept of benevolent benefactors to work with them on rent.
The District does have areas that are buzzing, but the retail landscape is dangerously close to becoming an outdoor mall, devoid of independent flavor. As Scott Wallis from Avenue Jack puts it, “If you have the same stores in every damn city, what fun is shopping?”
Pixie Windsor says she sometimes receives inquiries from would-be business owners asking about her 14th Street store. “All their plans end when I tell them the cost of what this space is,” she says. “There aren’t nooks and crannies for [small businesses] to start off on their own. I can’t imagine where anyone independent would go.”
Yet her outlook for Miss Pixie’s remains optimistic. In March, she renewed her lease for five years despite the rent. “That’s as far out as my plans go,” she says. “Of course, I would like to be here longer, but we’ll see.”