City Staff Fails at Sherwin Williams Project to Provide Required Retail Agreement

City Fails to Get Sherwin Williams Retail Agreement in Writing

City Council Comes Up as Empty as 
All the Storefronts in Town

Senior planning staff at City Hall revealed last week the retail component of the Sherwin Williams project mixed use residential development in Emeryville's Park Avenue neighborhood has no written protections that would keep storefronts from sitting perpetually empty despite the City Council expressly garnering a guarantee against that made in 2016.  The Council also directed the staff to protect against the developer renting to chain stores, another condition of approval from November 1st, 2016 that was ignored by the staff and now impossible to enforce.  Time has run out for Emeryville to ensure its retail plan at Sherwin Williams is brought forward; the developer cannot at this point be held to providing for non-formula retail at the site or providing against letting the stores sit empty as was established by unanimous Council vote.  "There are no such protections for either condition" a staff member told the Tattler, "nothing is in writing".

Councilman Scott Donahue
He told voters in October 2014:
"We should require developers to structure
rental agreements that provide for subsidies
and other support to help smaller,
locally serving businesses to succeed."

 

And so goes the Sherwin Williams project down the same path as virtually every other development with retail over the last 25 years; vague promises made by the developers to providing wonderful neighborhood serving non-formula stores in a timely manner, a paradigm that has spectacularly failed.  City Councilman Scott Donahue  summed it up best at the November 1st 2016 meeting, "It has been difficult for our city he said, The chains have more money, but we have a desire for retail expressed by our community, he added.

The loss of a written retail agreement so adamantly expressed by the Council is especially egregious for the Sherwin Williams project, watched so closely as it has been by community activists including by the Park Avenue Resident Committee (PARC).  Indeed, PARC's entire raison d'être is to make sure this kind of thing doesn't happen, specifically at Sherwin Williams.  Emeryville residents would be excused thinking if we can't get a retail agreement that addresses these issues here, we likely can't get one anywhere.

It's been a problem for years here.  Many residential developers in town build associated retail as required by the City but they aren't interested in the commercial rental business and so because the City has never required them to fulfill their retail assurances in writing, the developers simply let the storefronts go empty.  The retail component is chalked up as a cost of doing business by these developers.  Other developers, seeking more traditional profit maximization, will rent their retail spaces out but at the highest rate the rental market will bear.  That generally prices out the kind of retail the residents want, leaving only chain stores.
Amid the exigency of this closed loop paradigm, Councilman Donahue hit upon a new idea to force the developer of Sherwin Williams to underwrite the retail by written agreement with the City, an expanded cost of doing business that actually would deliver, but he and his colleagues failed to follow through, trusting the staff to do as the Council directed.

Councilwoman Dianne Martinez
"Another thing we're hearing from the community 
is the fear of the retail space going empty. 
The landlord might prefer a write-off 
than lowering the rent"
She directed the staff to get it in writing.

The idea that the developers themselves need to underwrite the cost of providing locally serving, non-formula retail has been kicking around in Emeryville for many years but the previous Council saw adding such constraints as anathema to the pro-developer coda engrained at City Hall.  Responding to citizen complaints in 2003, a previous Council attempted to lure better retail instead with a taxpayer subsidy to businesses at the 'Promenade' development, albeit with mixed results.  A coffee shop that received taxpayer subsidies at the San Pablo Avenue Promenade strip mall development promptly went out of business as did a small restaurant but Arizmendi Bakery, also the recipient of start-up help from City Hall has been a success.
The current City Council has so far tried a different approach, attempting to lure the kind of retail the citizens want with a Byzantine system of 'bonus points', an approach that up until now hasn't met with success.  With the failure of the Council to follow up on the staff's directive at Sherwin Williams, the new idea of forcing the developer to underwrite the locally serving retail is an idea that has still not been put into practice in Emeryville.

A viewing of the short video (below) from the November 2016 meeting shows how stark is the recalcitrance of Emeryville's city staff.  The two Council members whom had promised voters to deliver non-formula locally serving retail when they first sought election, Scott Donahue and Dianne Martinez, were adamant.  Councilman Donahue told the staff the developer represented by Kevin Ma of Lenar Development they could lower the rent for the retail if he (Mr Ma) can't find "non-chain neighborhood serving" retail at the market rate and that the rent should go down until it is rented out to the desired tenant.  "We can come up with something simple that they (Lenar) can agree to tonight that would solve this problem and make this a better community." Mr Donahue told the staff.  "I'm all ears to cutting a deal tonight about this" he added.

Emeryville Planning Director Charlie Bryant
Handpicked by former City Councilwoman
Nora Davis, Charlie did not require Lenar to legally
agree to the Council's requirements.  Lenar is free
to leave the Sherwin Williams retail empty
or to rent to Burger King.

Councilwoman Martinez agreed and expressed concern that the retail storefronts not sit empty as so many others have done over the years in Emeryville, "Another thing we're hearing from the community is the fear of the retail space going empty. The landlord might prefer a write-off than lowering the rent"  Ms Martinez said.
The developer however expressed concern that the development process not be held up for anything, "The biggest problem tonight is from a timing standpoint." Mr Ma told the five Council members  'If we would make any amendments to requiring the regulating of the retail tonight, that really throws us off our timeline...  We've gotten to a razor thin timeline with the current approval schedule".  He assured the Council "We will work with the Planning Commission to bring these commitments..." to which Councilman Donahue responded, "I'm satisfied we can say 'no' to your project if you don't come back to us with something definitive in writing that will deliver just what we're talking about."

And then the Emeryville City Council dropped the ball; they never checked on the staff about putting their directives in writing, leaving the citizens with nothing but the same assurances they've always gotten from developers over the last two decades about all the wonderful retail to be coming.  The staff for their part, refused to comment on why they served the developer rather than the City Council they are paid to, "It is what it is" one staffer tersely told the Tattler last week after affirming that the Sherwin Williams developer could rent to any chain store they want to at their project or to not rent out the future retail spaces at all if that serves their pleasure.  It's all up to the developer's whims now.


The November 2016 smoking gun video that 
reveals the Emeryville staff to be recalcitrant.  

Major Housing Pivot for Emeryville: Mixed Income Out, Poor Door In

Sherwin Williams Project: ‘Poor Door’ Housing Comes to Emeryville

What’s Old is New Again in Urban Housing Policy: Separate Entrances for Poor People

News Analysis
The City of Emeryville is poised to violate its own mixed income housing policy guidelines to begin a new era of housing segregation based on income if the City Council follows through with the Sherwin Williams development plan Tuesday that would allow the developer of the apartment project to corral all the poor people renting there into a separate building containing only the required below market rate (BMR) rental units.  The move, the first overt separating based on income of Emeryville residents in modern history will put Emeryville in the middle of a nation-wide debate on the increasing use of the so called 'poor door'; the use of separate entrances (or buildings) for poor people by developers forced to include below market rate housing in their projects while attempting to keep the poor people out of sight of the rich people in their projects.

The wealthy in New York City pay a premium for
housing with poor doors but
Mayor, Bill de Blasio has called on a
poor door ban.

The debate about the use of poor doors has generally elicited the ire of city planners and social critics and notably some cities who have banned them outright or are in the process of doing so but also some defenders, a list that now is to include the City of Emeryville.  
The societal benefits of mixed income living have been settled city planning for generations and poor doors have been shown to be not only alienating for the poor but for the wealthy as well. The Urban Institute, a Washington DC based social policy think tank has railed against poor doors' tendency to increase social inequities, observing,  “Elements of building design, such as lack of common areas or shared building entrances, can serve to limit informal interactions, which otherwise could serve as the basis for developing more significant ties.”

As America slides into income and wealth inequality not seen since the Gilded Age, the stratification of society can’t help but be reflected in how a city develops in the physical sense regardless of how egalitarian a municipality imagines or less, claims itself to be.  The return of the ‘poor door’ not seen since the robber baron era resplendent as it was with its separate entrances for servants but now cropping up in new residential development in wealthy urban enclaves, was inevitable given the riven plutocratic society we have built.  

To mollify would be critics of the income segregated housing project scheme at the Sherwin Williams site, Lennar Urban, the lead developer says the BMR apartment building will look as nice as the market rate towers in the project and it will be located next to a planned small park space the poor would be allowed to access.  Talk like that was enough to satisfy the City Council when they approved the Environmental Impact Report for the project at the September 6th Council meeting.  Further, Lennar noted that government agencies who's charge it is helping the poor would be assisted if they were all consolidated in one building.  And they would receive added tax incentives from the federal government.

Sociologists may decry the Dickensian undemocratic nature of poor doors but their use, it has been noted, allows developers to make more money based on wealthy people's general aversion to mixing with poor people and keeping the poor out of sight increases the market rate for market rate housing. Kevin Ma, Lennar's point man for the Sherwin Williams project, refused to answer questions about this point.

Some might find this new direction epitomized by the poor door, redolent of a sociopathic and alienating old direction, to be worth debating in our town, especially since it is counter to the City's own housing policy.  But it is a debate that has not happened as the City Council quickly prepares to move Emeryville into a new era of what can only charitably called 'separate but equal' housing.