Redevelopment and Starbucks: It’s No Accident

by Randy Shaw on June 6, 2005

While Starbucks has announced it is dropping plans for a Japantown store, its prospects for future deals with the Agency for cafes in other neighborhoods remains bright. Beyond Chron has learned that, in addition to San Francisco, Redevelopment Agencies across California view the billion-dollar corporate coffee chain as central to their strategy for “urban renewal.” Is San Francisco really so desperate for more Starbucks that a city agency should be spending money to attract new ones?

San Franciscans are not typically fond of retail chains, but in the past decade Starbucks has quietly opened almost everywhere. The San Francisco Redevelopment Agency likes Starbucks so much that there are multiple outlets at Agency-owned land at the Metreon, and they contracted with Starbucks to open a cafe in Japantown.

Japantown activists fought back, however, and the chain has withdrawn its plans. The coffee chain’s opening was seen as the death knell for Japanese-American cafes in the area, and the final blow to what activists see as decades of community betrayal by the San Francisco Redevelopment Agency.

Business owners in Japantown, the Fillmore and along Sixth Street have learned to their dismay is that when the Redevelopment Agency promotes “assistance in site location or relocation,” what it means is that city tax dollars will be spent bringing in new businesses to compete with and potentially destroy longtime, independent operations.

The Agency-Starbucks deal is not an aberration; rather, it is consistent with the Agency’s mission of participating “in initiatives to assist major employers to maintain and expand San Francisco operations.”

The small businesses in Japantown are not “major employers” with other operations throughout San Francisco. Such independent and typically family owned enterprises thus stand in the way of the Agency’s “renewal” of blighted communities.

It turns out that Starbucks is precisely the type of “major employer” preferred by Agency staff across the state. In fact, those who assumed that the omnipresence of the Starbucks was a triumph of free enterprise may be surprised to learn how Redevelopment Agencies routinely use taxpayer dollars to attract the popular coffee chain.

For example, the San Jose Redevelopment Agency brought a Starbucks to the city’s new Convention Center. Starbucks was described as the first of “many upgrades” planned for the Center, with a Krispy Kreme outlet scheduled to open soon.

San Jose currently has 20 neighborhoods under RDA control. In an 18 month period ending in 2002 the San Jose Redevelopment Agency either bought outright or used its powers of eminent domain to move 35 companies. All told, 99 businesses were closed or relocated to “renew” two shopping areas in East San Jose. 95 of these 99 businesses were Latino or Asian owned.

In San Jose, Starbucks is only the tip of the Agency iceberg. Despite claiming to be focused on strengthening neighborhoods, the Redevelopment Agency’s operation in San Jose has been a nightmare for those unfortunate enough to be running independent small businesses. Read details at http://www.coalitionforredevelopmentreform.org/

Even its most loyal customers would not consider Starbucks an “historic” business. But that did not stop the city of Campbell’s Redevelopment Agency from putting a Starbucks into the Historic Downtown Campbell area.

Why a Starbucks? According to the Campbell Agency it is a “quality retailer” that helps energize and stimulate economic growth downtown.”

The Redevelopment Agency of Ontario, California also saw Starbucks as fitting perfectly into its goals. The Agency, like seemingly all RDA’s in California, sees the worldwide coffee conglomerate as helping to encourage “core community revitalization.”

In addition to San Francisco, San Jose, Campbell and Ontario, Redevelopment Agencies in Burbank, El Cajon, Menlo Park and Richmond have turned to Starbucks to revitalize their communities. When we wonder why so many commercial areas in the state now look alike, Redevelopment Agency’s love affair with Starbucks and other “major employers” is one of the reasons.

The Agency’s placement of a Starbucks in Japantown, despite nearby locations at Fillmore and California and Fillmore and Eddy, was not a mistake. Rather, Starbucks fulfills the Agency’s mission of encouraging viable businesses (stores rarely if ever go out of business), creating jobs (independent or family owned cafes lack the profit margin to hire as many employees), and of expanding the city’s tax base through coffee sales.

This is precisely the problem with the Redevelopment Agency. Its very mission spawns an homogenized, antiseptic neighborhood landscape that runs counter to the spirit of San Francisco and the desires of its residents.

Compare the San Francisco neighborhoods under the jurisdiction of Redevelopment with the city’s most thriving communities and the lesson is clear. The areas primarily filled with large concrete structures are those under Agency control; the thriving neighborhoods of distinctive design and independent small businesses have escaped Agency governance.

The battle over Starbucks in Japantown was a short one, as the giant corporation quickly moved to avoid the public relations nightmare that the store has become. But the San Francisco Redevelopment Agency remains primed to bring Starbucks and other “major retailers” into the Mid-Market neighborhood and other “blighted” areas.

The owners of Cafe Hana in Japantown have benefitted the entire city by publicly exposing the Agency’s broken promises. As Linda Jofuku of the Japantown Task Force put it, ” We are tired of outsiders trying to shove their ideology down our throats…telling us what is best for us.”

Jofuku and her colleagues got the ball rolling—now it’s up to the small businesses in Mid-Market to join with nonprofits, artists, and residents in saying “No” to the Starbucks, Pottery Barns, upscale condos and Krispy Kreme world that the Redevelopment Agency wants to install in the heart of San Francisco.