The commercial spaces at 866 and 870 Valencia St., which once belonged to Borderlands Books and Borderlands Cafe, respectively, have remained vacant since the cafe closed in April, 2019 and the adjoining bookstore decamped to the Haight in June, 2022.
Now, the cafe space has been leased: the next tenant will be a sushi place, the winning offer of several made for the space, according to the realtor.
The deal was finalized several months ago, but the storefront’s windows are still boarded-up and heavily graffitied. Jeremy Blatteis, the realtor who brokered the lease agreement, is unsure when the new business will open.
Blatteis is also in charge of the lease of 866 Valencia St. He says there has also been “activity” on this space, though the lease is still available. The continued vacancy at 866 Valencia, despite numerous offers made for the spot next door, could have something to do with the different zoning of the two spaces: 870 is zoned for food use, whereas 866 is zoned exclusively for retail, according to the listing information on the Blatteis Realty website.
Blatteis sees such zoning policies as the primary cause of persistent commercial vacancies in the city, contrary to the narrative that they are a result of high rents. Most landlords “will adjust the rent, if it’s a good tenant,” he says. Currently, the city is “rigidly zoned:” It can take months or even years to obtain permits, change building use, or even build a bathroom, he says.
The city, he says, has a “reputation for being restrictive.” He believes, instead, that “the markets should dictate whether or not a store should open.”
Ryen Motzek, the president of the Mission Merchants Association, agrees that “the city does make it difficult to open businesses,” but believes these same policies are “safety bumpers.”
He says that because restaurants and bars make more money than retail outlets, they can afford to pay higher rent. Without restricting the number of spaces zoned for “food use,” retail outlets would not be able to afford commercial spaces. He says this occurred in the Mission between 2014 and 2016, with mass restaurant openings bumping retail on Valencia Street.
Motzek blamed the persistent commercial vacancies in the Mission more on “cleanliness and safety issues.” “People come to an area to shop and dine when they feel safe,” he says. He believes that, rather than changing ordinances, the city needs to create a safer and cleaner corridor and BART stations.
Zoning and sanitation aside, Blatteis said his firm brokered a number of deals in the Mission last year, and continues to see interest in the neighborhood from “really cool groups.”
“The best days are ahead of us,” he says. “We’re in a much better position in terms of retail today than a year ago” though the neighborhood has yet to reach “2019 levels of commercial lease activity.”