Noe Valley Voice November 2009

Josh Epple of Drewes Meats on Church Street is counting on customer loyalty and Thanksgiving turkey sales to tip the scales in his favor this month.
Photo by Pamela Gerard

How's Business? Merchants Looking to Santa for Cheer

By Tim Innes

From the top of 24th Street to the foot of Church, shopkeepers and restaurateurs in Noe Valley continue to be challenged by the worst recession in three generations. For many, sales are down as consumers, beset by tight credit, fears of job loss, and rising health care costs, curtail spending.

Some merchants face even greater challenges. The venerable Drewes Bros. Meats in Upper Noe Valley and the 24th Street Cheese Company--faced with stiff new competition and changing consumer habits--are fighting to survive.

Still, shop owners are betting on better times ahead by stocking up on goods for the holiday season, when they ring up as much as three-quarters of their annual sales.

"I do believe we're going to have the best Christmas season ever," said Robert Roddick, president of the Noe Valley Merchants and Professionals Association (NVMPA) and a board member of the Noe Valley Association (NVA), the self-taxing district on 24th Street.

Both groups will deck 24th Street with holiday lights and sponsor th e annual Noel Stroll on Saturday, Dec. 5, when Santa Claus will pay a visit (see page 31).

Some "green shoots'' of growth have already sprung up. The opening of the long-awaited, $5 million stimulus package known as Whole Foods Market and the filling of several empty storefronts with new ventures have boosted foot traffic on 24th Street.

"I'm cautiously optimistic that things are turning around," said Carol Yenne, owner of Small Frys children's clothing store and a former president of the merchants association.

Home Values Rising?

Also lifting spirits is the growing strength of the neighborhood housing market, which improved in September for the third straight month after 15 months of decline, according to an analysis of home sales and prices done for the Voice by Zephyr Real Estate.

The median price of a single-family home was $1,120,000, up 5 percent from a year earlier and off just 0.6 percent from September 2007. The median peaked at $1,770,000 in March 200 8, according to Zephyr.

Nine homes changed hands in September, compared with eight in the same month last year and six in September 2007. Condominium sales doubled between the second and third quarters, thanks to their relative affordability.

Amy Arost, managing director of Zephyr's 24th Street office, said the analysis showed homes in the neighborhood selling for 1 to 2 percent above asking in the third quarter, compared with just under asking during the first nine months of the year. All-cash sales have helped to mitigate the effects of tight credit, she said.

Light at End of Tunnel

Whole Foods filled a void left by the February demise of Bell Market, Noe Valley's only supermarket, and the 2003 closure of the Real Food Company. With Bell and Real Food out for the count--and with the subsequent shuttering of Streetlight Records, Noe Valley Video, GNC, and Aveda--the 3900 block of 24th Street often resembled a ghost town.

"Business just tanked early this year," said Heather Br uch, proprietor of the Urban Nest, a gift shop across the street from three of the vacant stores. "There were days when only 10 or 12 people came in. Things are coming back, but it's not all the way back yet."

Mike Stanton, co-owner of Peekabootique on Castro Street, said that after a strong January, sales slid in February and March as former Bell customers went elsewhere to shop. "But after a couple of months, people started coming back as they remembered that there was more on 24th Street than just a grocery store."

Stanton said traffic in the children's store had rebounded, especially on weekends. "October has been a strong month. We got a nice bump during the [Oct. 19-20] storm, from people buying raingear for their kids," he said.

Whole Foods Fills Sidewalks

Roddick said that the NVA thought it was imperative to replace Bell Market quickly. Joined by the NVMPA and the Friends of Noe Valley, the group sold Whole Foods on the idea of locating on 24th Street and lobbied City H all to expedite the permit process.

NVA Executive Director Debra Niemann said she believes the effort is paying off. "The opening of Whole Foods has brought life back to the neighborhood," she said.

Astrid Rabat's Veronica Ruedrich agreed. "The whole neighborhood seems brighter, more energetic since Whole Foods opened. People had been down in the dumps. This is a real shot in the arm."

An informal survey of neighboring shopkeepers showed a common theme: business is improving, foot traffic has increased, and shoppers seem to be in a buying mood.

"The Whole Foods opening brought some new people in at first," said Kathryn 'Kat' Haskell, a manager at Ambience, a women's clothing and accessories shop. But we're seeing mostly regulars now."

For Lisa Violetto's Judy Frangquist, the supermarket opening has not only boosted sales but meant that Noe Valleyans like her no longer have to leave the neighborhood for groceries.

"I'm really pleased with the service here," said Noe Valley resident Amy Wong as she packed 2-year-old twins Ryan and Jeremy and three bulging shopping bags into her minivan in the Whole Foods lot. "The fruits and vegetables are amazing," said Wong, who also frequents the Saturday farmer's market down the street.

Drewes, Cheese Co. in a Bind

Not everyone is cheering Whole Foods' arrival. Josh Epple, owner of Drewes Bros. Meats on Church Street near 29th, said his business dried up when the new market opened. "We noticed it immediately,'' he said. "It was like a graveyard in here."

Epple said the butcher shop's sales, already down 35 percent because of the recession, fell another 20 percent, or $700 a day, in October. While he has not fired any of his half-dozen employees, he has cut their weekly hours by more than half.

Epple hopes sales of Thanksgiving turkeys and other holiday fare will be strong enough to keep the 120-year-old shop--which survived the 1906 earthquake and fire, two world wars, and the Great Depression--in business. He's planning an advertisin g and marketing campaign to attract new customers.

"We're going to keep fighting," he said.

Also disgruntled is Charles Kung, owner of the 24th Street Cheese Company, just east of Sanchez Street. "Whole Foods is a disaster,'' said Kung, who charged that the Austin, Tex., company had gone back on its pledge to work with neighborhood businesses.

"Nobody from Whole Foods has talked to me," said Kung. "The only people we've seen from Whole Foods are some store employees who came in after work to check out our selection and prices."

According to Kung, executives speaking at community meetings earlier this year said they weren't going to have a big cheese department. "Have you seen it? It's bigger than this," he said, gesturing toward his cheese counter.

Kung said that if business didn't improve he'd have to close the store, which he bought in 1986.

Team Swells to 100

Others complain about traffic backups on 24th Street and a shortage of parking. Some also grouse that they can no longer leave their car in the parking lot while they dash across the street for a bagel or burrito.

Noe Valley Whole Foods team leader (manager) Angela Lorenzen said restrictions are necessary to ensure that her customers have a place to park. Team members guide vehicles in and out of the lot and assist shoppers with their purchases and carts to expedite traffic flow.

"We're not here to take business from other stores," said Lorenzen. "Our team members have been trained to send people to other businesses if we don't have what they're looking for. A personal goal of mine is to boost business in all of Noe Valley."

Lorenzen said business at the store, the company's smallest, has exceeded expectations, leading to the hiring of additional team members. The store has just over 100 workers, nearly four times as many as Bell Market employed.

Watch for Discounts

Meanwhile, businesses are going all out to please penny-pinching consumers.

At Pomodoro on 24th Street near Noe, children eat free on Tuesdays with the purchase of an adult entree. A few blocks up the street, Firefly offers $35 fixed-price, three-course dinners Sundays through Thursdays.

Cooks Boulevard on Castro Street is celebrating its fifth anniversary with special tastings, recipe swaps, and cookware demonstrations. The shop is also a neighborhood distributor for Frog Hollow Farms produce.

Diane Kudisch, who called October sales "lousy,'' plans to add a children's section this month to attract more families to her 36-year-old San Francisco Mystery Bookstore on 24th Street near Diamond Street.

And Small Frys has brought back its popular colored-ring drawing. Shoppers pulling a red ring from a box by the cash register get 40 percent taken off their purchase. Blue, green, and yellow rings result in smaller discounts, making everybody a winner.

To chase away the economic blues, Small Frys owner Carol Yenne offers customers a fun, color-coded game where they can draw discounts ranging from 10 to 40 percent.
Photo by Pamela Gerard