S.F. cuts red tape to make it easier to open chain stores in key area of the city

Vacant storefronts and mostly empty sidewalks are common along parts of Van Ness Avenue in San Francisco. But city leaders argue they took a significant step Tuesday to revitalize the struggling retail corridor by making it easier to open chain stores like Starbucks and Target on the thoroughfare.

The Board of Supervisors approved changes to cut red tape on Van Ness between Redwood Street and Broadway in a unanimous vote. 

That means retailers that want to open stores along that stretch of Van Ness will no longer need a special permit that often takes between 12 and 18 months to get. Instead, a chain store will get immediate approval as long as it meets all other planning codes. It’s unclear how long the process will take when the legislation takes effect, but Supervisor Stephen Sherrill said it will significantly decrease red tape for these kinds of retailers. 

The city defines formula retail as a chain with 11 or more outlets. Fights over chain stores used to be common in San Francisco, but no opponents spoke at the hearing, signaling how the tide has turned as residents, landlords and city officials are desperate to fill empty retail spaces. 

Supervisors Sherrill and Danny Sauter, who both represent parts of Van Ness Avenue, introduced legislation in January to eliminate the costly and time-consuming process of requiring chain stores to get a special permit. 

Those permits can be appealed to the Board of Supervisors, which can add another layer of review and costs, discouraging businesses from opening in the area, retail brokers say.  

“This legislation takes a major step towards reducing barriers to filling commercial vacancies,” Sherrill said during Tuesday’s board meeting. “We should be helping fill these vacancies, not standing in the way, especially when this change is in line with the history of Van Ness’ commercial identity and history.”

Sherrill said Van Ness is facing persistent commercial vacancies. A recent planning department survey found there’s a 53% ground floor commercial vacancy rate on Van Ness, compared to 7.7% in the city as a whole. Even Union Square — where many businesses have closed since the pandemic — has a lower vacancy rate than Van Ness at 22%.

“If we know these spaces are hard to fill, why are we making it harder?” Sherrill said of the special permits needed.

“We need to be doing all that we can to make it easier to open stores.”

If the new ordinance passes its second reading next Tuesday, it takes effect 30 days after the mayor signs it, which could be as soon as Wednesday.

Sherrill also noted that the legislation will help to bring a new grocery store to the Fillmore, where a Safeway closed earlier this year. He said the current rules prevent a new grocery store from opening without a special permit but the legislation would streamline the process to make it easier to locate a new grocery store there. 

“It’s time for Van Ness to realize it has great potential as a thriving commercial hub,” Sherrill said.