Seattle Becoming A Full-fledge `retail Phenomenon'

BY CLAIR ENLOW
Journal A/E editor

Shoppers are the lifeblood of downtown neighborhoods. For years, developers, city officials, civic groups and retail businesses have worked together to bring them downtown, get them out of their cars and then lure them a few more revitalizing steps -- or blocks -- down the street to buy.

Planners know it helps if they have money to spend, feel reasonably safe, have tickets for an nearby evening event and expect to find great food and entertainment just around the corner.

Despite all the new development, retail's ground zero will remain at Westlake. Photo by Clair Enlow

Seattle delivers -- or soon will. The downtown retail core itself has turned a corner in the last five years, stepping from the brink of blight to the gates of shoppers' heaven.

Banana Republic and NikeTown already await them, along with the upscale tenants of City Centre and Westlake Center. Stores like Bang and Olufsen, Teuscher Chocolates and Z Gallerie are some of the new stars at Rainier Square. Williams-Sonoma Grand Cuisine, Helly-Hansen and Pottery Barn have signed commitments to open at Pacific Place when it is complete. And there are rumors that Virgin Records, Crate and Barrel, Gene Juarez and J.Crew are standing by to join the mix.

"What we're turning into is a full-fledged retail phenomenon," said Jim Norman, who has been brokering and consulting in commercial real estate for 30 years in Seattle.

And what's good for retail is good for the city. "It will give us the tourism and the tax base to assure longevity," Norman said. "The assist from retail cannot be overstated."

Like other real estate and business people downtown, Norman remembers having a sinking feeling just a few years ago when Frederick & Nelson closed its doors and I. Magnin left. The writing was literally on the wall. But city officials and potential developers put together packages of public and private investment for the redevelopment of those two critical blocks.

Seattle's brush with blight echoed the decline and redevelopment of other major cities in the U.S.

Salvaging downtown was "the whole battle during the Seventies and Eighties," said Kate Joncas, president of the Seattle Downtown Association. "In the Nineties, that has turned around."

Today downtowns are hot again, Joncas said, and not just Seattle's. "It started around the late Eighties and early Nineties, about the time K-Mart decided to go back into Manhattan. ...Finally, the secret is out. Downtown is clean, safe, fun."

Seattle shoppers never really left downtown, nor did the residents of close-in neighborhoods. But now suburbanites and out-of-towners are out on city streets too.

"The last holiday season was just incredibly successful," Joncas said, reporting that Seattleites visiting Planet Hollywood and NikeTown were overheard to say: "We just haven't been downtown for years."

"Now our challenge is to keep them coming," she said. And keep them walking. "We want to make (downtown streets) so pleasant that they want to walk down Pike Street and to the Regrade," she said.

Another important challenge is keeping them downtown after hours.

"The piece that has been so missing is that activity in the evenings and weekends," said Pacific Place development partner Matt Griffin. "It is clearly starting to emerge. The other part that will develop is downtown living. The theaters and restaurants will help to bring some of those people."

The crowds are gathering. There's the Paramount, ACT Theatre, the new Seattle Symphony hall and the convention center expansion. Finally, Seattle is "a town that goes from noon into the evening. The pieces have fallen into place in the last 12 months," said Griffin. "People are putting dollars into sidewalks and storefronts.

Pacific Place bringing a taste of Michigan Avenue to Seattle.

Seattle is drawing comparisons with retail meccas such as Vancouver, B.C., San Francisco, Portland and Chicago.

But there is danger in filling downtown with national retailers, according to retail consultant Pat Johnson of Seattle's Outcalt & Johnson. Shoppers will find only "more of the same" and that would disappoint everyone from Eastsiders to conventioneers.

"The place that visitors love is the place that the locals love," Joncas said. "I want to make sure that we're clear about this: Downtown has to work for locals first. We want to get them downtown and circulating around downtown."

The common denominator in urban retail success stories is entertainment.

"We've got to be as clean and as safe as Disneyland," said Joncas. "But we don't want it to be prepackaged -- we want it to be real."

Seattle has its own home-grown success story. Over nine million visitors a year go to Pike Place Market, where the show -- and the price tags -- are real. "The market has very expensive things and very inexpensive things," Joncas said. "Everyone can enjoy the market."

Downtown Seattle is not in danger of becoming "over-Guccied," according to Seattle-based retail consultant J'Amy Owens of The Retail Group. Even after this wave of new development it will "look like a place where families can go."

Owens sees no problem with the growing number of national names downtown. "There will always be a local market. Local retailers have to serve this market, because nationals cannot, in the main."

It is the balance sheets of those national tenants, Pat Johnson said, that allows developers to get their financing.

Now that the construction of Pacific Place (the former Systems parking block) has begun, Matt Griffin's company is busy

Pacific Place's tenant mix is designed to attract more shoppers on weekends and evenings.

gathering final commitments from the tenants that will make his project a success.

Griffin said his company has no particular preference for out-of-town retailers. It all has to do with the "customer base," he said, and the match between Pacific Place and the stores he signs on. "We still like doing things with local retailers when we can find local retailers that fit (the customer base)."

When his company leases to national retailers, said Griffin, it is with those looking to do "something special here."

That something special may be strategically similar to NikeTown, a retail outlet designed to inspire other stores to carry Nike merchandise and display it to advantage. "At NikeTown the register is ringing," said Owens. "But that isn't necessary for them. That store is a three-dimensional ad. It's strategic."

Other companies, like Levi or Helly Hansen, have also chosen Seattle as the site for their signature stores.

National is not always out-of-town. Seattle has its own national retailers, like Starbucks, Eddie Bauer, Nordstrom and REI.

Nordstrom's new flagship store in the old Frederick & Nelson building will become a tourist attraction as well as a shopping destination, according to Griffin.

The euphoria about downtown retailers is supported by trusted formulas for retail success. In the age of the shopping mall, the mix of tenants is determined by the spending power within the "catchment area," the geographic area from which customers are drawn, said David Gosling, a professor at the University of Cincinnati and author of "Design and Planning of Retail Systems." The drawing area, however, can become global in the case of a large city that attracts international business travelers and tourists as Seattle is beginning to do.

"We have the attention of a lot of national retailers," said Maria Royer, a retail broker with Terranomics. "Because we have all the elements that make for a vibrant downtown." Those elements include a "manageable place to live," a good economy and a steady supply of out-of-town visitors.

Royer lives downtown and said the increasing presence of people who choose to live and shop downtown is important to the future of the city. Despite the perception of visitors, she thinks there is adequate parking. Recent initiatives to advertise parking are helping to address the continuing competition of suburban malls.

Despite all civic efforts, the retail phenomenon of downtown Seattle seems to be emerging almost as a force of nature.

"How do you sell Seattle? Just show them the pictures," said Griffin. "It's about as pretty a place as there is in the world. ...Besides that, it has one of the best economies in the country. We have a more educated population and a higher-than-average income."

But don't underestimate planning. The most important ingredients in downtown revivals, according to Gosling, are the links -- between work, residence, after-hours activities, hotels, convention centers and tourist attractions.

Creating these links takes planning, said Gosling. "At the end of the day, it all has to do with design, with connections." Whether it's the renewal of a downtown neighborhood or the creation of a new town, Gosling said, "When you have developers who hire good architects, you have a recipe for success."

Successful downtowns, according to architect and NBBJ partner Bill Bain, "build a spoke and then put the major retailers on the ends of the spoke." Smaller businesses complete the link with compatible stores. In Seattle, these links are all well mixed with entertainment, "historic resources," and the convention center, he said.

"There are weak links," said Owens, "like the one between the urban core and the market. But meanwhile the links between that same core and the waterfront are getting stronger, with projects like Harbor Steps and Bell Street Pier."

In the retail core, Owens is watching what's emerging around the old I. Magnin store but, "Ground zero has always been Westlake and that's going to continue."

There are increasing areas of "shopability" in the surrounding blocks. Shopability, according to Owens, is a combination of ease, excitement and access that makes people feel, "I know what it is and I know how to get there."

"In this way, Seattle is becoming more like Michigan Avenue or Fifth Avenue," she said. And also more like international shopping destinations where there are districts for antiques, clothes, theaters and entertainment retail.

"Once you see Nordstrom completed, I think you're going to see a flurry of activity," said broker Maria Royer.

"Five years ago no one would have said that Seattle was a retail destination on a grand caliber," said Owens. "But now it's becoming as good for retail as it is for backpacking."