Costco Opens. What Comes Next?
Washington, D.C., welcome to the era of warehouse retail.
The city's first Costco opened this morning in Fort Lincoln, near the intersection of New York and South Dakota avenues NE. Last night, Mayor Vince Gray, Ward 5 Councilmember Kenyan McDuffie, and other notables wandered the aisles in a state of giddy excitement at the store's preview reception.
"Imagine how many jobs this will create!" Gray exclaimed to me as he polished off a plate of free appetizers from one of the event's many catering tables. (Vice President Joe Biden showed up this morning.)
The store would not pass the Greater Greater Washington urban test, not by a longshot. For all but the residents of the small Fort Lincoln neighborhood, it's only accessible by car via the highway-like New York Avenue, or by bus (one of the new employees told me she takes three buses from her Southeast home, for a two-hour commute each way). The entrance is via the enormous parking lot; from the street, one sees just a huge windowless facade.
A city official at the event said he expects the majority of the shoppers to be Marylanders on their way to or from work. As a neighborhood amenity, then, the store may not bring much value; but as an economic boost, it ought to go some way toward ending "retail leakage" and creating new jobs. The Gray administration expects the store to create 1,200 new jobs and generate $634 million in tax revenue over the coming 30 years.
But it's just the first of several incoming big-box general retailers: Walmart is still on its way. The six D.C. Walmart stores will feature a variety of designs and approaches to city living. But the most suburban of them will be just around the corner from the new Costco, at New York Avenue and Bladensburg Road NE. Can they coexist? Some city officials are bigger fans of Costco, given its higher wages and wealthier clientele (the average household income of Costco shoppers is $96,000). The Costco store is also bigger than any of the coming Walmarts, at 154,000 square feet.
I can't help but feel torn about the Costco and its brethren-to-be. Failure would clearly be a bad thing: It'd mean job losses, huge vacant buildings, and questions about the viability of retail in these neighborhoods. But overwhelming success might be even scarier. I shudder to think that the photo above might be the new face of retail in D.C.