Getting to 11

RETAIL SPACE on Fillmore Street has become among the most desirable in San Francisco, second only to Union Square.

Much of the demand comes from national brands finding creative ways around the city’s attempts to curb the proliferation of chain stores. The city defines “formula retail” as companies with 11 or more stores. So major retailers are launching new concepts under different names on Fillmore before they “get to 11.”

• Gap Inc. opened its first Athleta store at 2226 Fillmore before rolling out the line of athletic wear nationwide.

• Soon Starbucks will launch a new juice bar at the corner of Fillmore and Sacramento — across from its outpost at 2222 Fillmore — as part of a worldwide rollout.

They join Ralph Lauren, Marc Jacobs, Jonathan Adler and Brooks Brothers’ Black Fleece line, some of which opened before the chain store limits passed in 2008.

Demand is so strong among fashion labels that real estate brokers have begun offering “key money” — sometimes $100,000 or more — to entice longtime merchants to give up prime storefronts to bigger companies with better credit willing to pay higher rent.

Recent months have seen an influx of nationally expanding fashion retailers eager to open on Fillmore before they have 11 stores:

• Fillmore’s newest boutique, Steven Alan, got in just under the wire by opening its 11th store at 1919 Fillmore in May.

• In April, Alice + Olivia opened its eighth store at the corner of Fillmore and Clay. A few days later, designer Roberta Freymann opened her ninth store at 2053 Fillmore.

James Perse, Cotelac, Curve, Peruvian Connection and Drybar also opened on Fillmore in recent months before they crossed the 11-store threshold.

Chase Bank is also rapidly opening new branches throughout San Francisco, including one on California near Fillmore. Financial institutions are not subject to the city’s chain store ordinance, although a move is now afoot to include them.

SF Business Times: “Fillmore Street hits new fashion heights

  • Brian

    I feel that part of the issue is also the extremely high cost the real estate. New small businesses simply can’t afford the rents. The only ones who can afford the spaces are major retailers.

  • ABJDSF

    Walking along Fillmore Street is always a delightful adventure.