Two SF supervisors are floating a rule-change that would lift limits on formula retail on the struggling Van Ness corridor. But the proposal prompts the question of why the Board of Supervisors isn't looking at more widespread changes to these rules.

There has been a perennial debate in San Francisco going back many years now over whether continued limits on or outright bans of chain stores and restaurants should continue in neighborhoods where the retail scene has been in a decade-long decline.

Back in the heyday of 2007, when the economy was great and some of SF's neighborhoods were more vibrant, voters passed Prop G, which expanded already existing limits on formula retail, drawing more SF neighborhoods into the restriction. By 2014, the policy was solidified, and multiple neighborhoods began requiring onerous, 12- to 18-month conditional-use permits for any chain retailer — defined as a business with 11 or more locations — that wanted to move in.

The Great Recession and the COVID pandemic came and went, and simultaneously over the last decade and a half, the American retail landscape had some seismic shifts. Consumers — especially those in the Bay Area — do a large portion of their shopping online these days, and once-vibrant corners of the city like North Beach and the Castro are littered with empty storefronts, or storefronts that see a revolving door of small businesses that struggle to survive with high rents and no anchor tenants nearby drawing foot traffic.

Exceptions include Hayes Valley, which has a formula retail restriction and has nonetheless maintained its status as a prime node of boutiques that get plenty of weekend foot traffic, especially. But even here you see signs of the current state of play — primarily online retailers like Brooklinen, Warby Parker, and Cotopaxi that have storefronts here to serve as brand-strengthening showrooms, places where customers can touch and try on products, but they still may go home and do their buying online. Only larger companies can afford such indulgences for branding alone.

Just looking at the Castro over the last ten years will show you a different story. Lost opportunities over the years to bring in a Trader Joe's or an Apple Store have left the neighborhood's retail scene a bit hobbled. Small clothing boutiques are still around, along with a couple of the older businesses selling sex toys and dirty greeting cards that are relics of the Castro of the 1980s and 90s. There was a glut of coffeeshops a decade ago that has somewhat shaken out in recent years with several closures.

Even hometown brand Levi's, which maintained a presence on Castro Street for over a decade, shuttered their store in 2022, likely for lack of business.

The downward trend of retail here, and in other areas like North Beach, predates the pandemic, because national shopping trends don't just shift overnight. Landlords have continued to seek high rents that some of these neighborhoods' retail activity just can't justify. And both neighborhoods suffer from a similar issue which is that the majority of the foot traffic they draw is for bars and nightlife — and, in North Beach, for restaurants — leaving daytime retail uses feeling fairly empty.

So, this week, with newly elected moderate Supervisors Stephen Sherrill and Danny Sauter proposing a lifting of formula retail rules on a one-mile stretch of Van Ness Avenue, we call on the supervisors to take a harder look at the retail scene writ large.

"Van Ness is a highly trafficked city arterial that has been hampered by an outdated planning code," Sherrill said in a statement to the Chronicle. "By reducing barriers to filling these empty storefronts, we can activate these vacancies, support property owners, and breathe new life into a corridor that has struggled to recover."

The same could be said for the Castro, where chain spots like Mixt or Lemonade would probably do quite well — though Castro restaurant owners would naturally object. And clothing shops would do well to have a mix of competition that included recognizable names — a critical mass of shops that create a reason to go there, like Hayes Valley has.

The coming reopening of the Castro Theatre as a part-time music venue, as well as all-around event and movie venue, will bring a fresh flood of foot traffic to the neighborhood, and the area would benefit by having more retail vacancies filled — like, for instance, the former Pottery Barn at Market and Castro that has sat empty for seven years.

Sherrill and Sauter say that Van Ness is a good candidate to start with because it's lined with spaces that were designed as auto showrooms, some of which sit empty, and only big chain retails are looking for spaces that size. Formula retail is currently allowed on Van Ness — see BevMo, among others — but companies have to go through the lengthy conditional-use process to move in.

As the Chronicle reports, Sherrill also called for a hearing about large retail vacancies downtown and how the barriers can be lowered to fill them.

Sherrill and Sauter's proposed change for Van Ness will still have to go through an extensive approval process in a supervisors' committee, and before the full board.

Related: Five Reasons Why The Castro And North Beach Have So Many Vacant Storefronts

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