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Balancing neighborhood retail, part 2: Incentives and supply

Yesterday, we discussed DC's current 25% linear-foot cap on restaurant and bar uses in some neighborhood commercial districts. Prohbiting restaurants is one possible tool for ensuring that restaurants don't completely push out other businesses. What other techniques could accomplish the same goal?

Photo by M.V. Jantzen.

Locally serving retail isn't the only use that zoning might encourage. The Comprehensive Plan also calls for zoning to encourage "small-scale office space" and arts and creative industries in neighborhood commercial areas. Office uses bring daytime activity to an area, boosting area business, and many of those businesses (like accountants or medical offices) can directly benefit the local residents.

Some districts currently contain specific incentives for certain uses. In the Uptown Arts Overlay (14th and U), a new building can receive an FAR bonus if it includes a theater. Downtown, buildings have to contain some residential use, but a "Child Development Center" satisfies 50% more of the residential requirement than equivalently-sized apartments. And on H Street, there's a specific FAR bonus if a developer puts a grocery store in Square 776 (bordered by 3rd, 4th, H, and I Streets NE).

In other areas, simply making some uses easier to create is the incentive. Normally, hotels require a "special exception," where the Board of Zoning Adjustment must ensure that they won't conflict with the public interest and other factors, but some areas allow them as a matter of right. Some districts have specifically permitted artist live-work studios in residential areas.

Likewise, new zoning rules could (and should) allow many uses as a matter of right, and could provide specific bonuses for the ones that communities most wish to encourage. However, DC's range of bonuses is limited. Arlington accomplishes much of its planning by giving developers extra height in exchange for good urban design and desirable amenities. However, Arlington's buildings can get much taller than in DC.

Another way to encourage more retail, especially neighborhood-serving retail, is to allow more opportunities for these stores to open. When high rents in popular commercial districts push out other stores, the rents can only keep rising because the supply of usable commercial space is limited. Most neighborhood commercial areas are small, and the surrounding residential zoning prohibits commercial activity. If restaurants are crowding out a small florist, we could let the florist open up in the basement of an adjacent residential townhouse, for example.

On the other hand, neighbors are often reluctant to allow commercial expansion because of the trash and loading truck traffic they generate, especially food establishments which create garbage that often attract rodents. However, zoning could restrict this expansion outside the commercial district to establishments, like clothing stores, florists, and pharmacies, which don't generate as much trash, and put strict limits on loading times and other impacts.

Parking policy can also promote certain types of businesses. The Pennsylvania Avenue performance parking pilot in Capitol Hill, which added market-rate meters to many blocks, has particularly helped daytime businesses which benefit from quick turnover. The right parking policies could help those businesses better compete with restaurant uses.

Which of these techniques do you think would help encourage thriving and diverse retail areas in our neighborhoods? Are there other tools that could help improve neighborhood commercial zones?

Update: Matt Yglesias posted an article on this topic right around the same time I posted this one, making the same point that limited supply due to the constrained size of neighborhood retail districts is the biggest market distorter.

David Alpert is the founder of Greater Greater Washington and its board president. He worked as a Product Manager for Google for six years and has lived in the Boston, San Francisco, and New York metro areas in addition to Washington, DC. He now lives with his wife and two children in Dupont Circle. 


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I can think of nothing more artificial then the distinction between "retail" and "neighborhood serving retail." Is a McDonalds "neighborhood serving retail?" Probably, How about a Home Depot? I don't know, the place is packed every time I walk in, so it serving people from some neighborhood I guess. What about a grocery store that is large enough to use its economies of scale to offer a wide selection of products at low prices (something a small market will never be able to do)?

Is the Shoppers Food Warehouse on Route 1 in Alexandria "neighborhood serving?" If so, which neighborhood given that a significant percentage of the customers there come from DC? I use that store and am very happy that its not in my neighborhood. The 7 minutes it takes me to drive there is more than worth not having the traffic, deliveries, etc on my block.

by notabene on Apr 30, 2009 1:03 pm • linkreport

It's important to actually parse the language contained in the zoning regulations in this case.

DCMR 11, Chapter 19 (Uptown Arts-Mixed Use ARTS Overlay District, section 1901.6 reads: "Eating and drinking extablishments shall occupy no more than twnty-five percent (25%) of the linear foot frontage within the ARTS Overlay District, as measured along the lots fronting on 14th and U Street, NW."

So, this begs the question whether the limitation only deals with frontage on 14th & U streets, and not the much larger ARTS Overlay District. This means that the illustrations in part 1 of this article referring to a restaurant at 7th & Florida and one at 15th and P may not be either part of the equation or affected by 1901.6. It also begs the question in regard to the 1900 block of 9th Street which does indeed include a truly dense assemblage of 'eating and drinking establishments', however, it's on neither 14th or U Streets.

The existing language of 1901.6 may be one reason that BZA would much rather see the Commercial Corridors/Areas working group come up with new language rather than attempt to interpret or enforce the current muddy language. In any case, it's important not to confuse the entire Arts Overlay Zone's land use restrictions with those circumscribed by 1901.6.

by Phil Spalding on Apr 30, 2009 1:46 pm • linkreport

"Is the Shoppers Food Warehouse on Route 1 in Alexandria "neighborhood serving?" "

Well, no. It provides a service that individual members of the neighborhood need, but doesn't bring the neighborhood together. Instead, it forces people *outside* the neighborhood. So, it's individual serving, not neighborhood serving.

by KB on Apr 30, 2009 1:51 pm • linkreport

What about a BestBuy in, say, Tenleytown?

I would prefer to see some sort of incentive system than artificial caps on certain types of businesses. I'm not in big favor of giving a drug store (i.e., CVS) some sort of favoritism, but I'd rather that than preventing restaurants that the community could support.

As for the problems--trash and loading zones--why can't enforcement of that be made better? If funding is lacking, raise commercial tax rates. Or decide that the entire community/neighborhood benefits from better trash handling and more sensible loading constraints.

by ah on Apr 30, 2009 2:41 pm • linkreport

I prefer the street-frontage approach a lot over the rigid moritorium approach.

As I said on yesterday's topic, the problem is too much of a street shuttered in the daytime. The street-frontage approach allows more nightclubs to open in upper stories and basements and encourages sidewalk-level development of daytime activity. (And I would exclude bars and restaurants open in the daytime from the street-frontage limit).

by Tom Coumaris on May 1, 2009 9:16 am • linkreport

Actually, limited supply isn't the only market distorter. So is limited demand. DC has more space, and more stated demand for neighborhood retail, than there are residents to support it. Sure, daytime population (office workers + tourists) does add more retail demand, especially for prepared foods, but the reality is that DC doesn't have that much inherent retail demand, and the Reilly Law of Retail Gravitation (which can be summarized as, transportation costs being roughly equal, people choose to go shop where the shopping is better [more stores, greater variety, better quality]), it's always going to be difficult to support quality retail in neighborhoods.

And that doesn't even take into consideration the reality that many retail sectors are difficult to profitably "represent" in small commercial districts.

This isn't a phenomenon unique to DC. Columbia, Maryland's neighborhood commercial districts (shopping centers) are also faltering because more were built than can be supported by the current population, based on how people tend to shop, and how the retail sector is organized and structured to deliver shopping options.

by Richard Layman on May 1, 2009 1:59 pm • linkreport

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