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When new store moves in, who has to move out?

Property values rise, affordable housing fades as market opens


by: TRIBUNE PHOTO: JAIME VALDEZ - Windy Williquette-Cheesman loves the New Seasons that has opened on North Williams Avenue, but hates the fact that the popular new store might be a factor in forcing her out of the neighborhood. A New Seasons-style grocery raises nearby property values about 20 percent, according to a Metro study.You might say that Windy Williquette-Cheesman is of two minds about New Seasons opening a grocery a block from the house she and her husband rent on North Ivy Street.

First off, she loves the store.

“I'm there like every day. I can't stay away from it,” Williquette-Cheesman says.

Before New Seasons opened on North Williams Avenue in August, Williquette-Cheesman once or twice a month would drive to a Costco in far Northeast Portland or a Fred Meyer on North Lombard Street for all her groceries. New Seasons can't match those supermarkets on price, she says, and she still hits one of the supermarkets for nonperishable items such as laundry detergent and toilet paper once a month. But shopping every day at New Seasons, Williquette-Cheesman says, allows her to buy what she needs to cook that day and results in a lot less wasted food. She figures cost-wise she's coming out close to even.

Williquette-Cheesman isn't the only neighbor who loves the latest New Seasons. Sales at the store have been more than brisk, though management refuses to share numbers. Residents in the surrounding area, even those with low incomes, say they visit the store regularly. So what's not to like?

A month before the New Seasons opened on North Williams, Williquette-Cheesman's landlord asked the couple whether they would consider moving. He told them he wanted to fix up the old house they've rented for 11 years, which clearly has seen better days, and sell it. Williquette-Cheesman asked if she and her husband could at least stay in the house until spring. She hasn't yet heard back from the property owner.

“We're almost being shoved out of here,” Williquette-Cheesman says.

The neighborhood around the North Williams New Seasons is still full of low- and middle-income apartments and houses like the one Williquette-Cheesman rents, many inhabited by young men and women with more education than income. But it's changing quickly. A local study of how different retail shops affect property values says that a New Seasons moving in will raise the value of nearby homes nearly 20 percent.

Specialty grocers boost investment

by: TRIBUNE PHOTO: JAIME VALDEZ - A renter at a house within sight on the North Williams New Seasons, Robbie (who declined to give his last name) says his landlord expects the value of the house to rise 15 percent within two years. The neighborhood around the store has many  rented houses. Economist Jerry Johnson says that based on his study he expects housing prices around the North Williams New Seasons to bump up within the next year or two. And the study he co-authored measured that rise independent of how overall housing values were rising and falling. A specialty grocery store in the neighborhood simply adds value, according to the study. The only other type of establishment that contributes to rising property values to that extent, according to the study, is a neighborhood movie theater.

New Seasons didn't start the gentrification of the North Williams area, according to Johnson, but it will permanently secure it.

“When you’re going through early stage gentrification, it solidifies the trajectory,” Johnson says. “It's like, 'New Seasons is in, I'm feeling good they'll keep the investment.' Pix is great, but they can go out.”

In fact, upscale bakery Pix Patisserie did move out of its North Williams location in July 2012. It has been replaced by Kenny & Zuke's Deli Bar. A number of new restaurants and trendy shops have taken root on North Williams in the last few years. But New Seasons will have a much more dramatic and long-term impact on the neighborhood, according to the Johnson-Gardner report.

Johnson says developers are well aware of the effect of having a New Seasons or similar grocery in a neighborhood. He was working with investors looking at building an apartment project on North Williams prior to New Seasons announcing it would build its store, and he advised the investors that they should wait until a specialty grocer came in. He told other investors interested in building on North Mississippi Avenue —a mile away — that they should factor in the increased value of their project as a result of the North Williams New Seasons.

Convenience at a price

Williquette-Cheesman grew up in the area near Legacy Emanuel Medical Center and has spent her entire life there. “This is my neighborhood,” she says. She wants to stay. Her husband works, but she's unemployed. Ironically, New Seasons could make it possible for the couple to stay in the area. Virtually every day, she says, she inquires about a job at the store. At home she has filled out online applications three times.

A half-block off Williams a black woman who asks that her name be withheld speaks with a rich accent and says she has rented her apartment for her family of five since 2008. Her landlord recently told her he intends to raise the rent. She's worried.

“They’re going to raise up the rent until you get tired and move,” she says.

On the same block, a man who gives his name only as Robbie says that his landlord told him that when New Seasons announced it would open on North Williams he expected the value of his property to increase 15 percent. The landlord is a high school friend, so Robbie, who works in a North Portland brewery, isn't worried that he'll have to move. He shares his apartment with four others, making the rent affordable, a common arrangement in many of the homes and apartments in the neighborhood.

Robbie says he's constantly walking across North Williams to buy something at New Seasons. “Sometimes we go over there three or four times a day,” he says. “Our joke is, we call it our new 3,000-square-foot pantry.”

Across Vancouver Avenue musician Dave Cole and Julia Wild, who works in a recording studio, rent a house with two roommates. Pretty much every day one of the housemates shops at New Seasons, Cole says, though their incomes aren't high-end.

“I hit up New Seasons purely out of convenience,” Cole says. “They have better food, or so they say. I'm buying.”

Wild likes the feel of the new store. “It's cheaper than Whole Foods but aesthetically and energetically more vibrant than Safeway,” she says.

by: TRIBUNE PHOTO: JAIME VALDEZ - New Seasons President Wendy Collie can show off a number of ways in which the North Williams store has tried to accommodate the neighborhoods long-time residents, but she cant control property values.

Store responds to clientele

New Seasons President Wendy Collie supplies ample evidence that her store is going to great lengths to embrace, rather than change ,the neighborhood into which it has settled. North Williams and Vancouver Avenue have become the city's primary north-south bike commuting streets. In response, New Seasons has more bike parking spaces — 66 — than car parking spaces — 58. When a customer explained that his family rode bikes to the store but had no place to park the tag-a-long in which the children rode, the store put in spaces for the larger bikes. Bike tools and a pump are available to customers for free.

The North Williams New Seasons keeps different hours than other New Seasons stores, which open at 8 a.m. and close at 10 p.m. That's because nearby residents told management that by 8 a.m. they've often ridden by on their way to work. So the North Williams store opens at 7 a.m. and closes at 11 p.m. Neighbors also told management that they were concerned that large trucks making deliveries would cause bike and car traffic jams during their morning commute so the store arranged to have most of its largest truck deliveries start at 4 a.m. and finish by 7 a.m. At most New Seasons stores deliveries don't even begin until 6 a.m.

“One of the reasons I think we're successful is we take about a year before opening a store to learn about the neighborhood,” Collie says. “By the time we opened our doors we were able to reflect back to the community what they were looking for.”

Hurting or helping?

by: TRIBUNE PHOTO: JAIME VALDEZ - A house for sale within sight of the North Williams New Seasons should see its value rise, if an economist report on how different stores affect property values is right.Collie's hope is that New Seasons can somehow become a bridge between the neighborhood's long-time residents and its newer arrivals.

“This neighborhood has a deep-rooted history,” she says. “You had some communities that were entrenched within the community, but not necessarily as one community. The risk there was, could we bring everyone together?”

She thinks that's happening. As an example, she notes that many of the older residents around North Williams aren't frequent users of organic food. So the store stocks more conventional items such as Oreos and Jif peanut butter than its other stores, and they're selling more of those items than the other stores.

New Seasons' efforts to embrace the historic neighborhood extend to prioritizing hiring of neighborhood residents like Windy Williquette-Cheesman. More than a third of the store's employees — about 60 people — live in North Portland. But if the Johnson-Gardner study is right, the rising property values produced by the store's very existence are working against the goal of bringing the neighborhood together.

In fact, the historic neighborhood the store hopes to reach out to may not be there much longer. Williquette-Cheesman, who is white, says 10 years ago everyone else on her block was African American. Now all her neighbors are white.


There's market for one grocer in South Waterfront

South Waterfront might be the next winner in the specialty grocery sweepstakes, according to economist Jerry Johnson, co-author of the 2007 Metro study that showed the impact of stores like New Seasons on neighborhood property values.

But South Waterfront may not yet have the feel of a traditional neighborhood. And Johnson says another factor that would limit customers is the fact that it's so hard for grocery shoppers from other neighborhoods to drive in and out. However, “there's a mad scramble to get somebody down there,” Johnson says.

It's hard to think of South Waterfront as a food desert, but the hard to get in and out factor means the people who live in those high-rise condos, just like some low-income folks in North Portland and Lents, have to plan on driving a fair distance just to buy groceries. Johnson, a consultant to developers, says he's taken a number of calls from investors talking about placing a real grocery store in South Waterfront.

Whichever one takes the plunge might lose money short-term, but be well-situated long-term, according to Johnson.

“One of them is going to get in there, and there’s maybe only room for one,” Johnson says. “So that could scare off the other ones. It becomes strategic. If I go in there, maybe the market is not ready, but this is my market.”


Adaptability key to success

Having opened groceries in Concordia, Arbor Lodge and now on North Williams Avenue, New Seasons appears to have proven it can make a go of it in neighborhoods that appear to lack the high-income characteristics usually associated with specialty groceries.

In fact, New Seasons President Wendy Collie says the Arbor Lodge New Seasons on North Interstate Avenue now leads all the company's stores in sales, with the Concordia store on Northeast 33nd Avenue in second place.

Collie says that part of the success of New Seasons stems from the company's willingness to adapt its stores to the surrounding neighborhood rather than impose one model at each site. Could a New Seasons also blaze trail east of 82nd Avenue? Collie isn't saying no.

“We are always looking at opportunities across the board, both in thriving communities and in food deserts,” Collie says.

“It would take multicultural marketing,” says New Seasons marketing director Amy Brown, who cites Fubonn on Southeast 82nd as a successful model. “We need to take a page out of the playbook and market to the community that lives there.”

One problem, Brown says, is the lack of walkable retail districts east of 82nd. The New Seasons model doesn't include huge stores with large parking lots. So far.