We found the end of the rainbow… the pot of gold was at The Wharf, Capitol Hill, and The Navy Yard…
Something is going on in Georgetown that doesn’t make any sense to the residents–Even with the strong demographic data and the strength of the “Georgetown” worldwide brand–retail businesses are pulling out and real estate prices appear to be stagnating… Why? Poor city leadership? Other areas (The Wharf, Capitol Hill, 14th Street, Navy Yard etc.) pulling all the investment away? Unreasonable landlords? Retail, in general, is hurting? The Business Improvement District (BID)? Other?
The “Georgetown” Brand
If you travel outside of the United States everyone knows about “Georgetown”–Maybe it’s the movies… the university.. or just the legacy of the area. Georgetown’s brand is almost as strong as that of “Washington DC”–and more stable from the looks of Google Trends.
If you review the stats Georgetown (20007) is one of the best demographics in the city. The area has a higher income than other more trendy zipcodes and pays more taxes per resident.
Here is how we compare to The Wharf (20024) and Capitol Hill (20002):
more from BID on demographics of the area.
So why is retail pulling out?
Commerical Real Estate Issues
If you read the Georgetown Business Improvement District’s (BID) market report and annual report things seem great but if you just walk up Wisconsin Ave you will see that it’s starting to look like a ghost town. Here are a few pictures from my jog one morning–you can see all the open properties here.
Here are also a few from M Street that just popped up
If you compare Georgetown to other “hot” parts of Washington DC such as The Wharf and or Capitol Hill in regards to Commercial Real Estate here is what you will see:
- 20007 has 111 commercial real estate spaces for lease, representing 299,768 sqft space. 12 buildings are available for sale. In the last 30 days, 20007 has had 15 new spaces come on market. https://www.officespace.com/zip/20007
- 20024 has 13 commercial real estate spaces for lease, representing 210,929 sqft space. 2 buildings are available for sale. In the last 30 days, 20024 has had 3 new spaces come on market. https://www.officespace.com/zip/20024
- 20002 has 148 commercial real estate spaces for lease, representing 836,116 sqft space. 37 buildings are available for sale. In the past 30 days, 20002 has had 5 spaces leased and 28 new spaces come on market. https://www.officespace.com/zip/20002
…it doesn’t look that bad overall but if you walk up Wisconsin Ave you will see that the numbers don’t make sense–something else is eroding this area.
…AND you might not find a convenience store like WaWa replacing high-end Restoration Hardware at The Wharf or in Capitol Hill. (more)
Is the same issue impacting residential real estate?
Residential Real Estate Market Stats
It’s starting to look as if what is going on in the commercial market may also be impacting residential real estate prices. Let’s compare Georgetown to The Wharf and Capitol Hill on Zillow–ouch! Georgetown comes up as “Cold”. Zillow’s algorithms are not always great on prices but this indicator is just a bit troubling…
If you read articles like this https://www.bisnow.com/washington-dc/news/neighborhood/georgetown-gaining-momentum-with-office-retail-activity-despite-new-waterfront-options-77816 in Bisnow you will think that things are going great but then again, just take a walk on Wisconsin Ave north of M Street and you will think you are in Detroit.
Is the poor maintenance of the side streets a result of the same problem? or is it unrelated?
Taking care of the sidewalks
I saw one of our older residents fall on the sidewalk the other day due to a loose brick–given Georgetown’s aging demographic this can’t be good. …Then there are the trees that no one seems to be trimming.
Where is SMS Holding’s Block by Block –when is their contract up for renewal?
What about the increase in the homeless population–is this related too?
Taking care of the homeless
…this is sad and seems to be getting worse. The city numbers reflect it getting better but for any resident of Georgetown that is out on a Friday night, it sure seems like it’s getting worse.
So, What is going on?
Plain and simple, there is not enough attention being focused on the details. At a macro-level there seems to be no issue but if you have lived here long enough you realize that something is wrong. The city needs to have a dialog, with action, about 1) the retail issues in Georgetown–specifically on Wisconsin Avenue 2) maintenance of side streets 3) the homeless. Washington DC, in general, is booming (it’s Number 8 in the Best Places to Live in the USA). Hot areas like The Wharf, Capitol Hill, 14th street, The Navy Yard are getting the city’s attention. It’s almost like city officials see Georgetown on autopilot–and why not… the Georgetown BIDs numbers look great —but the city needs to look deeper… it’s about the details.
Details Matter: http://newsroom.ucla.edu/stories/wooden-shoes-and-socks-84177 … “The first thing Wooden did was sit them down and teach them how to put on their shoes and socks. Doing this properly, Walton said, was the initial lesson for “everything we would need to know for the rest of our lives.”
Separate out Wisconsin Ave and M Street in Georgetown from the broader area and focus attention on the retail issues–Spend time on some of the innovative concepts outlined in this paper ‘How to revitalize your city or town’ (here) specifically for these 2 streets. Another idea is to work with Georgetown University’s MBA program.
Some items that stand out in other publications:
- How To Revitalize Your Local Main Street (here)
- “Encourage Entrepreneurs”
- 12 Strategies That Will Transform Your City’s Downtown (here)
- “Does your city have public policies (like tax abatements, grants, and other special incentives) to promote downtown development?”
- “Create a permanent public market”
- “Create a branded downtown entertainment district”
- How cities can revitalize dying urban spaces (here)
- “Details Matter” <<this is why BID needs to be addressed.
- Street Life After Retail: 5 Scenarios That Imagine the Future (here)
- “A legislated tax-penalty for street-level vacancies”
- How Cities Can Save Small Shops (here)
- Street Retail Looks to Malls in Figuring Out Ways to Cope With Big Rents (here)
- Idea for retailer: “ask for terms long found in shopping centers—low base plus a percentage rent (meaning the retailer pays the landlord a certain percent of every dollar in sales over a certain threshold).”
What are your ideas?