Housing Complex

CityCenterDC Shapes Up as D.C.’s Destination for the One Percent

citycenter-1

Last month, I asked if CityCenterDC, the mega-development on the former convention center site downtown, was becoming D.C.'s Rodeo Drive. The announced retailers at the time were high-end bag store Tumi, high-end bag store Kate Spade, high-end bag store Longchamp, high-end shoe store Allen Edmonds, and high-end checked-beige clothier Burberry.

But wait: There's more!

Today, Jonathan O'Connell reports at the Washington Post that another retail lineup will soon be announced that's likely to include Dior, Hermès, Paul Stuart, Salvatore Ferragamo, and Zadig & Voltaire. A rendering of a planned hotel on the second phase of the development prominently features the name "Giorgio Armani" in one of the retail slots. According to the Washington Business Journal, upscale shoe store Jimmy Choo, leather goods store Louis Vuitton, and cashmere store Loro Piana have also signed on.

One can argue that D.C. has traditionally been underserved by luxury retail; as Howard Riker of Hines, the developer behind CityCenterDC, told me recently, "If one is staying at a hotel and goes to the concierge and asks, 'Where can I shop?,' there’s a pretty good chance over the past 20 years that the concierge says, 'Go to Tysons,' or maybe Friendship Heights." And the influx of high-end retailers is good news for Hines, which collects the rent, and the city treasury, which collects the sales tax.

But is it the best use of the space for the city as a whole? Remember, this was city-owned land, and so the D.C. government got to lay out its conditions and desires when soliciting bids for the space. Hines has promised CityCenterDC will be "an authentic place for urban residents to socialize outside their homes" and "the unequivocal centerpiece of Downtown DC." Yes, there will be a central plaza area with restaurants and a small park to the north of the development, but for the most part, the people socializing at CityCenterDC will be those who can afford to shop at the store or eat at the pricey eateries. The residences there aren't cheap either; apartments are renting for up to $7,500 a month, while the likes of Sen. Claire McCaskill and Attorney General Eric Holder have been buying condos for $2.7 million and $1.5 million, respectively. Ninety-two of the 674 units at CityCenterDC will be affordable apartments, per an agreement with the city. But none will be for very low-income renters: The income cap for half will be 60 percent of area median income and for the other half will be 80 percent of area median income; the latter, given the high average incomes in the D.C. suburbs, will be open to families of four making up to $86,000 a year.

Of course, the city can argue that on such prime real estate, it makes more sense to maximize revenue and use that revenue to build affordable housing elsewhere than to force the developer to produce lots of affordable housing on-site. But while CityCenterDC is shaping up to be a major revenue generator, it doesn't look like it'll be a primary gathering space for the masses.

This post has been updated to include a report from the Washington Business Journal.

Photo by Darrow Montgomery

  • SLF

    Now the one-percenters can play at being *bag ladies*?

  • Eric

    You need to take a more macro view. This solid investment by the high-end retail industry can benefit the neighborhood and downtown as a whole. It proves that it is a worthy investment. We NEED high-end retail. Maybe not so you and I can shop there on a regular basis, but for a well-rounded retail scene, and to hopefully attract further retailers downtown nearby on H, G, and especially F Streets.

  • Art

    I agree with @Eric.

  • Ben

    Eh, I can't really get too worked up about this. From the beginning, the developers have said that the retail they were looking to bring in would be of the high-end variety. And outside of Friendship heights and perhaps Georgetown, there really aren't any high-end retail districts in the city, despite the affluence here.

    I personally won't be shopping at these establishments, but I don't begrudge the fact that they're being brought in. This means more residents and visitors staying in DC to shop, and more tax dollars flowing into the city's coffers. Besides, if someone's seeking a more down-market shopping experience, all they have to do is venture a few blocks south where pretty much the entirety of F Street between 9th and 14th is mid-tier retail establishments.

  • Purrsey Pcat

    I, for one, can't wait for these stores. I will now only have to go to Friendship Heights for Neiman's and Saks. I wish we could get a high end department store in the complex as well.

  • Corky

    Hmm. I guess the Burberry's store on Connecticut Avenue and the Allen Edmonds on L Street were just too run down for the upper crust.

  • tony

    It sounds like Reaganomics to me. You know, the trickle-down effect.

    It AIN’T happening.

    Again, black leadership has a responsibility.

  • http://houseguydc.com Michael

    We can only support so many Five Guys and Subways. Not every store in town can be "affordable".

  • Northwesterneer

    If Allen Edmonds is considered high end at $250 for leather shoes then you need to stop thinking like a peasant. Try "mid-career" or "solidly American-made."

    Playground for the One Percent? $250 shoes? Try Playground for the 40%.

    Aaron, The city paper wages are not middle class, they are underclass. Your salary is not middle class. That is your personal issue to deal with, not ours. Why are you taking it out on the GS-13s? The city has changed, have you?

  • hiigaran

    I can't tell if Northwesterneer's comment falls under a corollary of Poe's Law.

  • CHRIS

    I never understand why people get upset that DC has some amenities aimed at the wealthy? I can't and won't shop at these new places or live in these residences. But, so what? I can afford to shop at most places in downtown Buffalo, Detroit, Cleveland and can't afford much of NYC, SF, London, Paris, etc. But, I know which cities I would rather be in any day of the week.

    This is replacing an empty parking lot, not displacing anybody or local retail. It's bringing new retail/street life to Downtown DC. And the high end residences are doing 1 of 2 things: 1) Attracting affluent suburbanites who otherwise wouldn't live (and pay taxes) in the city or 2) Attracting people from other areas of the city (thereby freeing up existing housing/helping to keep the prices of those units down).

  • MP

    I agree with some of the comments above. Not a big deal. I think it's great for the city's tax base that we have some high end retail. Why shouldn't we keep this business in the District?

  • bmack

    How is it a bad thing to vary the mix of retail in DC? DC's overrun with low end and moderate shopping. High end will keep some of the big spenders from decamping for Tysons or NYC when they're jonesing for a spending spree. And it will help lure more wealthy foreigners to DC. That helps DC's economy and tax base. Not sure how that can be considered a negative. You want a massive, planned mix of low/mid retail? Check out the debacle that is Underground Atlanta. I suspect ATL would trade UA for CityCenter any day of the week. I'll likely never shop at CityCenter, but I'm glad it's coming because it will be good for the city.

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  • http://www.dcantonart.com DCDuck

    @CHRIS: Building high-end luxury condos and apartments won't alleviate the price pressure on people looking for more affordable units.

  • Tom

    If you want money to pay for schools, parks, road, police, what have you, someone has to pay the taxes for these things. Bringing in high income tax payers and getting tax receipts from high-end retail downtown will bring tax revenue that can be used all over the city.

  • Mike Madden

    @CHRIS, Northwesterneer:

    No one's "upset" that D.C. has amenities aimed at the wealthy. The question is whether those amenities ought to be going onto city-owned land, and whether -- especially given the high-end stuff in the development -- there's enough affordable housing as a component of the deal.

    Also, Northwesterneer: Though I won't dispute the fact that all of our staff could use a raise, a GS-13 is not "the 40 percent" in D.C. The pay range for GS-13s in 2013 went from $89,033 to $115,742 -- so even on the low end, one GS-13 makes about 33 percent more than the median household income in the city.

  • shawguy

    I am actually 100% for this development, even though there is no chance in hell I will ever be able to afford to live there, and there is equally little chance I will ever patronize any of the stores now that Apple is confirmed DOA. While some of them do carry things I can afford, I think it's pretty stupid to spend that much on the stuff they sell, with the exception of my every-three-year new iPhone purchase, which I can't buy there anymore.

    But I still love the fact that they built this, and that they put it in prime real estate. Because this brings rich residents, shoppers, and diners to the city, where we get to skim 10%-25% right out of their wallets in income taxes, sales taxes, liquor and prepared food taxes, and parking taxes in that huge garage under this thing.

    Everyone in DC complains about how we don't do enough for the poor. We should have more affordable housing, we should have bigger daycare subsidies, poor kids should get free metro rides, we should renovate or rebuild schools and libraries in poor neighborhoods, etc. And that's all fine and dandy. But nobody thinks about how we are going to PAY to do all those things, or nobody is willing to admit that the poor can't pay for it. If they could, *they wouldn't be poor*.

    We will make more from one floor in one building of these high-end condos and the high-end lifestyles of their owners than we do from entire blocks of poor neighborhoods. And that means we can DO more for these neighborhoods with their money. And, hopefully, it means the middle class gets something out of the deal too - maybe not "an authentic place for urban residents to socialize outside their homes", but an inexhaustible supply of rich people's taxes year after year till the end of time to pay for bike share, dog parks, and some public space maintenance is a pretty good runner-up prize, especially when they don't have to raise my taxes to pay for it.

  • jeff gerhard

    I don't mind this being a location for luxury condos and high-end stores I haven't even heard of. I just wish this high-end retail district was not made up of such ugly, boring buildings. I kind of think international shoppers might still prefer Georgetown which is 1000 times more charming and also they are allowed to sell alcohol.

  • Economist

    No more fur coat deserts!

  • Rich

    So far, the stores that are open seem to have few takers. Places like Tysons and Friendship have anchors like Lord & Taylor or Nordstrom to drive traffic to boutiques. Even an Apple store (previously discussed) or a flagship REI (a frequent wishlist item) would do more to guarantee the future of the complex than a bunch of stores few can afford. If the complex is relying on tourists, it's really kind of far from the West End/Georgetown concentration of truly high end hotels.

    Re: upthread: Allen Edmonds is about twice as much as most shoes in a regular store and if I was going to invest in a really fine shoe I'd go to over to Alden's which has much better quality, as well as even higher prices.

  • LoganRes

    @Rich, The city is opening the Marriott Marquis hotel one block from CityCenter on May 1 and just announced a Conrad Hotel going in at CityCenter. Also, Trump is building a hotel on Pennsylvania. I think the retail mix at CC is more aimed at the high end international conventioneers that the convention center is aiming to lure.

  • BeeBee

    This article is wrong-headed. All international destination cities have high end retail. These shops are not only for denizens, but for international travelers. High end shopping helps to make a place a destination. No one goes to Paris or London to shop at H&M. They can do that at home. The city is "growing up" and part of this is much needed diversity of housing as well as retail options. Also, as the city becomes more international, the well-heeled will need somewhere to shop. They shouldn't be required to drive to Tyson's or fly to NYC to get something that they should be able to get in the city core of any city worth its salt. I would welcome a mini Dubai if it could fill the District's coffers. Besides, even middle class people sometimes indulge in luxury goods. Why not do it here in DC? The problem I have with much of what is written in the City Paper is that people here often act as if DC should only be home to the poor and that the poor are the only people we should be looking out for. While I am no believer in "trickle down", the city needs people with money in order to be able to take care of those who have less. We will never reach our full potential until we realize that fact and begin to exploit it.

  • Payton Chung

    Indeed. Better to build a gilded ghetto for the rich on an old parking lot, harvest the sales tax revenue (and poach some from Fairfax & MoCo), divert rich folks away from further bidding up rowhouse prices in the neighborhoods*, and save the storefronts on Wisconsin or 14th for local shops instead of more big-name brands. These blocks can be like Tysons II to F Street's more populist Tysons I. The Gap announced a large new store over on F, and others will follow.

    * recent sales of $1.2M in Shaw, $2.1M in Capitol Hill, $4.1M in Logan Circle

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  • Jonathan Large

    CityCenter appears to have taken its architecturally cue from the rather dated, dull and ugly 20th century international style. That alone would dissuade most shoppers, even the affluent. As for residents, why are investing in such a horrid looking home? Why? There are prettier places in the Nation's Capital to choose from.

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