Foster City is strategizing a long-term sustainability plan to ensure it remains prevalent in the Peninsula retail market and accommodates the variety of the city’s population groups. The independent consulting firm Bay Area Urban Economics presented a report about the challenges the city faces and its retail potentials at a council meeting Monday.
With the expansion of developments like the corporate Gilead campus and Chess-Hatch master plans, there will undoubtedly be more people in Foster City during the day.
Foster City is home to a large population from different parts of Asia that has rapidly increased since 2000, according to the report. The success of stores like Ranch 99 and ABC in the city is proof of the demand for specialty stores, according to the report.
“The neighborhood need is paramount, because those are the people who are going to be in those shopping centers,” Councilman Charles Bronitsky said.
The city will continue outreach efforts through focus groups, sending out questionnaires and approaching businesses to gain a sense of what the consumers’ needs are and how to accommodate them through their continued retail development efforts, Bronitsky said.
There is also a stark increase throughout the Bay Area of the 20 to 30 age group known as the “young digerati,” Assistant City Manager Steve Toler said. This new tech-based population has unique customer demands on which the city could capitalize. Boutique retail stores, entertainment opportunities and establishments that could support eating and drinking were suggested by the BAE.
The city is planning to sell the 15-acre Foster Square space to the developer New Home Company. Thirty-thousand square feet of the area will eventually be used as retail space, Bronitsky said. However, in determining what kind of retail space to implement, the future residential population at the site must be considered, said Councilman Art Kiesel. The rest of the space will be primarily made up of senior housing, assisted living, memory care and affordable housing units, Bronitsky said. The retail space at Foster Square should accommodate upcoming senior consumers, Kiesel said.
In general, Foster City residents have high levels of discretionary incomes yet spend proportionally less than residents in other parts of the county, according to the report. The BAE established an individuals disposable income spent per year in the surrounding area is about $15,000, however the city only experiences about $12,000, Toler said.
“This is a significant opportunity for us. But the disadvantage that we have here is that we are pretty much built out,” Toler said.
A significant concern is the “retail leakage” the city suffers, Toler said. The city is losing income from sales tax as many residents travel elsewhere to shop, Toler said. Due to the close proximity of the Hillsdale and Bridgepointe shopping centers, Foster City needs to figure out ways to keep consumers in its taxable areas, Kiesel said.
Although Costco, Safeway, Orchard Supply Hardware and other businesses at the city’s Metro Center shopping center attract customers, it’s in direct competition with the Bridgepointe Shopping Center across the border in San Mateo, Toler said.
“[Bridgepointe] is a great shopping center for Foster City residents, but the city doesn’t collect sales tax for it. It provides great amenities, but the bottom line is not every city can be everything for everybody,” Toler said.
At the crossroads of State Route 92 and Highway 101, the city has the opportunity to become a regional draw, it just needs to figure out how to market itself, Toler said.
One of the traditional difficulties the city has with retail is because it doesn’t have a main downtown or access to the El Camino Real corridor and is off the beaten path, Bronitsky said.
The report suggested the most viable location for new retail development would around the intersections of Foster City, Shell and Edgewater boulevards described as the “gravity side” of the retail area. It’s the area where most residents and daytime workers enter and exit as they pass through town, Toler said.
Armed with the extensive data BAE provided in its 187-page report, the city will now begin to evaluate its potential development locations. The Charter Square owned by West Lake Development stirred some controversy at the meeting, Toler said. A portion of the storefronts is unoccupied. But the council will first focus on selling the 15-acre Foster Square space at the Nov. 18 meeting.
(650) 344-5200 ext. 106