Eastern Market South Hall, Tuesday, August 8, 2017
City Eyes Increasing Rents for Eastern Market Food Merchants/Vendors
by Larry Janezich
Earlier this year, the Department of General Services (DGS) contracted with Marcus Asset Group to conduct an appraisal of the 14 stall spaces within Eastern Market’s South Hall. The study grew out of the DC Code requirement that rents reflect fair market rents and practices. To assist them, Marcus Asset Group engaged the services of Market Ventures, Inc., a specialty urban planning and economic development firm.
The resulting report was made public at the end of August. The range of recommended rents per square foot for each of the South Hall merchants are shown below, with the low to high figures showing the range in dollars per square foot per year.
Product/Service Business Name Sq. Ft. Low + High Base Rent
Flowers Blue Iris Farms, Inc. 279 $46 to $49.50
Dairy Products Bowers Fancy Dairy 337 $60 to $64
Produce and Grocery Calomiris & Sons 643 $38.50 to $42
Delicatessen Canales Deli 665 $81 to $90
Grocery/Prepared Food Canales Inc. 309 $38.50 to $42
Meat Canales Quality Meats 367 $35 to $38.50
Poultry and Eggs Capitol Hill Poultry 335 $35 to $38.50
Fruits and Vegetables Paik Produce 308 $38.50 to $42
Pottery Studio Eastern Market Pottery 1,152 $15 to $18
Baked Goods Fine Sweet Shoppe 755 $47.25 to $50.50
Restaurant Market Lunch 938 $70 to $90
Poultry and Eggs Market Poultry 418 $35 to $38.50
Fish Southern MD Seafood 864 $33 to $36
Meat Union Meat 1,091 $35 to $38.50
Total Rentable Space 8,461
According to Margeson, the current South Hall rents range from $26 – $40 per square foot per year (excluding the basement space occupied by Market Pottery). In comparison, rents for stall or vendor space outside the market are as follows:
South Hall Merchants $26 – $40 per square foot annually (except basement pottery studio)
Farmer’s Line $28 – $44 per day
North Plaza Arts/Crafts $28 per day
7th Street Arts/Crafts $44 per day
Prepared Food Natatorium Plaza $35 per day
Flea Markets $2000 per month each
In a letter to EMCAC accompanying the report, Market Manager Margeson states, “Our plan is to use the average of the upper and lower limits of each stand’s appraised value in the form lease.” The letter states that the rental rate would increase incrementally over three years until it reaches the appraised rental value (adjusted for inflation).
If the recommended rent increases for the South Hall Merchants are calculated using the average of the upper and lower recommended limits, total annual revenue from merchants and vendors would be $383,125 – $146,119 over the 2016 rent total for the South Hall at $237,006, according to figures released earlier and reported by Capitol Hill Corner here: http://bit.ly/2eExsh6
In addition, DGS has contracted to for an appraisal to determine what the rents should be for stall space on the 300 block of 7th Street, between Pennsylvania Avenue and C Streets, SE. Those spaces are currently occupied by the Saturday and Sunday flea markets which are scheduled to move their whole operations to the newly reopened C Street between 7th and 8th Streets at the end of October. Once that happens, the monthly $2000 the flea market managers pay to DGS will accrue instead to the Hine developers – Stanton-Eastbanc – since under an agreement with the city, they will own that block of C Street. What happens to the 300 block of 7th Street remains to be seen. There is substantial community support for keeping it closed to traffic on weekends, and the current thinking of ANC6B and the Eastern Market Community Advisory Committee is that until a final determination is made by a broad selection of community stakeholders, EMCAC and the Eastern Market Manager should jointly determine usage of the block on a temporary basis.
Also in the works is an appraisal for the vending spaces in and around Eastern Market, including the Farmers Line, the arts and crafts vendors on the 200 block of 7th Street and the North Plaza, and the prepared food vendors in front of the Rumsey Aquatic Center on North Carolina Avenue.
A consensus seems to be building among stakeholders that rents for the merchants in the South Hall not be increased until the other appraisals are complete when any rent increases necessary to maintain and promote the market can be imposed taking all sources of revenue into account. EMCAC will consider the appraisal and next steps regarding its implementation at their monthly meeting, Tuesday, September 19, at 7:00pm in the North Hall of Eastern Market.