When I first heard that Nordstrom might want to relocate from Crossroads Plaza to The Gateway, I thought "Why not? As long as they remain in downtown Salt Lake City, where they locate should be up to them." So I can understand why people may wonder why the City Council and Mayor are not taking steps to enable them to move. As I studied this issue-including listening to a lot of people-I changed my mind.
You see if Nordstrom were the sole concern of Salt Lake City, the answer would be easy-let them move. But the issue is larger than Nordstrom. The issue is really the future of Main Street.
Salt Lake City's downtown is more than Main Street. It runs from Temple Square on the north, to the Grand America Hotel on the south, and from The Gateway on the west, to Trolley Square on the east. It is an important and valuable asset for the citizens of Salt Lake City, but also the whole state and in some ways the entire region. And yet while there is more to downtown than Main Street, Main Street is the center of and in many ways the heart of downtown.
Blake Nordstrom met with City Council members last December to express his concerns with their current situation at Crossroads andinterest in moving to The Gateway. This is a council issue for two reasons. First, The Gateway zoning does not allow for department stores (other retail, as well as restaurants, theaters, and housing, are allowed). For Nordstrom to locate there it would require a change in zoning meaning it would be considered by the Planning Commission and then would need to be approved by the City Council. The second reason it is a Council issue is because of the nature of The Gateway.
The Gateway was made possible through the efforts of Salt Lake City including the Redevelopment Agency (RDA) of Salt Lake City. The city council serves as the board of directors of the RDA, with the mayor as the chief administrative officer. Not to minimize the tremendous private investment that has gone into The Gateway, this project would not exist were it not for the actions of the city through the RDA. When the project was being considered for approval several council members were concerned that Gateway would compete with Main Street. Although I wasn't a member of the Council at the time, it is clear from the record and from speaking to those who were involved, that the Council received numerous assurances from the developer that Gateway would be different from and not compete with Main Street. The Gateway project was marketed as a "lifestyle center" that would provide restaurants, entertainment, and housing in addition to retail. Repeated assurances were given that Main Street would not be raided in order for Gateway to succeed.
Because of concerns raised by city council members, in addition to the zoning that prohibits anchor department stores such as Nordstrom from being at The Gateway, other restrictions were put in place as part of the development agreement between the RDA and the developers (the Boyer Co.) including reducing the city subsidy to the project if retailers relocated from Main Street. With these assurances in place, council members acting as the RDA board approved the project by a vote of 4 to 3. Without the assurances that Main Street would be unharmed there would be no Gateway development today.
Soon after Mayor Anderson and three new council members (including me) took office in 2000, there were rumors that the Boyer Co. was "wooing" Nordstrom. (The Boyer Co. denied this.) To further tighten the already existing agreement, Mayor Anderson proposed an additional restriction-limiting retail to no more than 45,000 square feet per store (exempting Galyans which had already signed an agreement for a larger space). The Boyer Co. personally represented to the city council that they agreed with this additional restriction. With that understanding I voted with every other council member to approve it.
After meeting with Mr. Nordstrom last December, council members had additional meetings with retailers and other businesses interested in downtown, and reviewed past policies.
Nordstrom is an important retailer-and none of us want to see them leave Salt Lake City. And yet we had concerns about the impact changing the zoning would have on other retailers and business on Main Street. Rather than "just say no" to a petition to change the zoning or refuse a change in the RDA agreement, council members wanted to say "yes" to Nordstrom-to let them know that we want them to stay in Salt Lake City on Main Street, and are willing to help them do so. As council chair, I had a telephone conversation with Mr. Nordstrom to that effect, and the Council sent him a letter on March 27, outlining our position. The letter, signed by all seven council members, states in part: When Gateway was being proposed and planned, Salt Lake City took care to see that it be done in a way that complimented, rather than competed with, Main Street and its malls. Thus it has always been Salt Lake City's intention that Gateway fill a different "niche" in the market than Main Street, and that Main Street would remain the location for large department stores such as Nordstrom.
This policy position is reflected in the agreements negotiated between the RDA and the developer and affirmed by zoning adopted for Gateway. We have reviewed our policies in view of your concerns and have unanimously concluded that we remain committed to these policies for the long-term good of downtown Salt Lake City, of which Main Street is the heart. To do otherwise would undermine over 20 years of planning and effort, and well over $100 million in public investments in just the past 10 years. Therefore, we are not in favor of changing zoning or previous agreements between Salt Lake City's Redevelopment Agency and Gateway Associates.
We went on to "pledge our cooperation to finding and participating in a solution that is good for Nordstrom as well as our long-term efforts for a strong and vibrant downtown;" and encouraged Nordstrom and the owners of Crossroads Plaza to work together. "If all parties are willing to work toward creative solutions we are confident that a positive solution, good for Nordstrom and our community, can be achieved. We will do all we can to participate in such a solution." Just as this issue is bigger than Nordstrom, it is also bigger than the agreements made between the City's Redevelopment Agency and the Gateway developer. The major issue really is the future of Main Street.
Retail continues to be an important part of Main Street. Other business owners have made and continue to make substantial investments on Main Street. One of these is the May Company, owners of Meier & Frank, who have recently invested tens of millions of dollars in their store on Main Street. At our hearing in April, owners of the ZCMI Center announced that they will be doing extensive renovations and changes to their mall. Undoubtedly this will be additional private investment in Main Street totaling many millions of dollars. And smaller retailers, such as Tony Weller, have also demonstrated time after time their commitment to Main Street. These investments were made based on the current rules of the game-the zoning. It would be unfair to these other businesses to change the rules now no matter how much we want Nordstrom to remain. Other uses on and near Main Street-such as offices and even housing-rely on a retail component being present.
If the council were to change the zoning and the RDA agreement to allow Nordstrom to move to The Gateway, it is likely that others would follow. We cannot legally change the zoning or the agreement for Nordstrom alone. The center of gravity would shift. The damage to retail on Main Street-and the potential negative ripple effect to other properties including commercial offices-would be felt for some time. People still talk about and remember how Broadway was once a thriving shopping area. It has taken decades for it to begin to turn around. We should not repeat that history.
When the City Council announced this past Spring that it would be focusing this year on the economic vitality of downtown and Main Street, public interest was overwhelming. I've been impressed that the people of Salt Lake-business owners and residents alike-really care about Main Street-not just out of nostalgia for what it was, but the promise it holds to continue to be the heart of a thriving and prosperous downtown community for years to come.
For me the bottom-line is this: I am not willing to turn my back on either the taxpayers' investment of over $100 million on Main Street the past decade, or the other businesses and property owners who, largely without subsidy, have invested and continue to invest in Main Street. At the same time, I am committed to doing whatever I can (short of turning my back on Main Street) to keep Nordstrom here.
If Nordstrom leaves town everyone loses—their loyal customers, their employees, and the retail and business community of Salt Lake City. There can be a solution, but it will take the cooperation of both Nordstrom and Main Street property owners, to find it. I am confident that the City Council stands ready to do whatever we can to further a solution that is good for Nordstrom and good for Main Street.
Dave Buhler in chairman of the Salt Lake City Council and District 6 representative.