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S.A. - Page 4&)6126 affect a retail store's sales. The strengths and weaknesses assessment presents opportunities for the task force to recommend actions and initiatives. Strengths • Downtown is safe, clean, attractive and pedestrian -friendly. • Caltrain and other public transportation systems provide easy access for workers, visitors and residents. • There is sufficient parking in the Downtown to support retail and restaurants. • A diverse selection of restaurants in Downtown offer a variety of cuisines and formats. • New mixed-use developments with residential and office space have been built, and more developments are scheduled to start construction, thus increasing the number of workers and residents in the Downtown. Weaknesses • Downtown has had a very low vacancy rate of two percent. Vacant spaces are quickly leased by coffee shops and restaurants that can afford to pay higher rent than small retail stores. This has helped make the Downtown a thriving dining destination, but the addition of retail businesses that sell hard and soft goods would help diversify and complement the Downtown business mix. • In addition to very low vacancy, retail rent in the Downtown currently ranges from $2.00/square foot (sf) (asking rent for Cost Plus World Market 18,000 sf space), to $4.50/sf for ground floor space (Pizza and Pints, former Brick Monkey space, and 925 Main Street). The sales volume of small retail businesses limit the amount of rent they can typically pay to $2.50-$4.00/sf or less. If the sales margins are higher, the business operator can pay more than $4.00/sf. • Vacant spaces in many older buildings do not have the ideal size, space, or layout for retail businesses. • There are some pockets of blight, tagging, and illegal dumping. • Many Downtown property owners are unwilling to provide tenant improvement allowances that are needed by higher -profile retailers (typically regional and national chains). • Downtown lacks a "catalyst" retailer or anchor stores that would help draw customers on a regular basis and help support smaller retail businesses. Cost Plus is a major "catalyst" anchor. Other smaller anchors that help draw frequent shoppers include a cell phone store, pharmacy/general merchandise (CVS or Walgreens).3 Philz Coffee, Starbucks, and Peet's are also desirable anchor stores. • While there is currently a policy that does not allow ground floor office uses in the Downtown Core, there are still a number of spaces that are currently occupied by office uses, which interrupts the continuity that retail stores provide to pedestrians. Some are larger spaces that would be ideal for a "catalyst" anchor retailer. 3 These anchors are already located in Sequoia Station, which makes it unlikely they will consider another location in the Downtown. City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.ore eee