When Joshua Adler ’96 first stepped onto Yale’s campus as a freshman in 1992, New Haven was “a very different place.”
Adler began his Yale career during what many alumni, administrators, city officials and local residents consider to be the “ultimate low point” for Yale’s relationship with New Haven. The years from approximately 1970 to the early 1990s marked over two decades of disconnect between the University and its host city. Yale had “totally neglected” the city, Adler said, and the areas of New Haven immediately surrounding Yale had, “in many ways, fallen into disrepair.”
“When I was an undergrad, the parts of New Haven that seemed safe included the length of Chapel Street between York and College [streets] and the portion of Broadway up to the Morse-Stiles walkway — that was the extent of the safe evening area,” Adler said. “It was really the bottom for New Haven and Yale.”
Fast forward to 2012, and the situation, Adler said, has turned on its head.
Today, Yale and New Haven have rebuilt their relationship through initiatives including the Yale Homebuyer Program, which offers University employees an income benefit if they purchase a home in the Elm City, and the New Haven Promise, which awards in-state college tuition scholarships to New Haven public high school graduates.
The most visible changes, however, have occurred because of Yale’s efforts to spur commercial retail development around campus, particularly along areas of Broadway, Chapel, York and Howe streets. Through Yale University Properties (UP) — the office that manages Yale’s portfolio of residential and commercial properties — Yale has amassed a network of over 100 retail tenants and 500 residential holdings, including nearly the entire Broadway shopping district as well as parts of Chapel Street. Paying more than $4 million in property taxes annually, Yale is one of the largest commercial property holders in New Haven. And by pursuing its strategy of attracting “high-quality retail,” UP, founded in 1996 as part of the University’s Office of New Haven and State Affairs, has helped “fuel a vibrant downtown community,” said Douglas Hausladen ’04, a former chair of the Downtown Community Management Team now representing downtown as Ward 7 alderman.
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After 14 years in business, UP has achieved a “critical mass” of commercial development on Broadway and Chapel that can be leveraged to attract prominent national and local tenants, according to city officials and University administrators.
But the road to this downtown “renaissance” has not always been smooth. In a city that has historically been wary of its expansive Ivy neighbor, many see UP’s upscale retail developments as catering exclusively to those within the Yale sphere. And because the University controls vast swaths of property — approximately 270,000 square feet of office and retail space in total — and has significant financial resources to leverage, UP can afford to hold its properties vacant until it finds its ideal tenant, at times frustrating neighbors.
As UP expands its retail presence to new areas such as the southern end of Dixwell Avenue and Science Park, its investments will continue to shape neighborhoods, building “the ‘new’ New Haven” that Adler, now a commercial retail developer himself in Washington, D.C., said has emerged around the University in the past 15 years.
CREATING AN ‘AUTHENTIC’ DOWNTOWN BRAND
As a top-tier university competing with with only a handful of other colleges for prestige worldwide, Yale has a vested interest in raising the quality of the New Haven areas surrounding its wrought iron gates. For Adler and four other alumni who graduated between the late 1970s and the early ’90s, Yale’s location in New Haven was the University’s greatest liability during their time as students. But all five said that University President Richard Levin’s and UP’s efforts to spur commercial development around campus have turned New Haven into a selling point for the Yale brand.
“There is no doubt in my mind that the parts of New Haven immediately surrounding Yale were by far the biggest negative about the University from a marketing perspective during the time I was applying. The sentiment was, ‘Oh, you don’t want to be in New Haven,’” Adler said. “But today, New Haven is a plus, not a minus — I absolutely believe that.”
In order to create such sustained commercial growth, a landlord must create “the right tenant mix” — an optimal balance of large, small, local and national retailers that can draw a revenue-generating customer base, said real estate lawyer Edward West ’79, president of the Yale Club of Washington, D.C. West and Adler, who have both continued to visit Yale as alumni, said the tenant mix UP has struck with its leases is now a “tremendous asset” for student shoppers and Yale’s marketability as a university.
The tenant mix of a commercial area can take years to improve and fine-tune, West and Adler said, and Yale spokesman Michael Morand said UP’s tenant mix has created a retail brand for the University and New Haven that feels “authentic” because of its “eclectic” array of restaurants, retail stores, theaters and museums. He added that it is unusual for a midsized city like New Haven to host retailers such as J. Crew and Apple, chains that are most often found in shopping malls. These and other street-front retailers coupled with free-entry museums including the Yale University Art Gallery and the Yale Center for British Art, Morand said, give the downtown area a “lively and walkable” character.
“The brand experience is that this isn’t just ‘any place’ — we aren’t a carbon copy of somewhere else, and we are original in that way,” Morand said. “When I’ve wandered around other downtowns, you don’t find the same thickness of retail and residential offerings in cities of this size.”
UP Director Abigail Rider cited Alex & Ani on York Street, a Rhode Island-based business that sells eco-friendly jewelry, and Oaxaca Kitchen on College Street, New Haven chef Prasad Chirnomula’s contemporary Mexican restaurant, as new downtown offerings that distinguish New Haven as a shopping destination. She added that by creating a “unique and attractive” retail mix, UP has been able to lure customers from outside the New Haven area who used to shop elsewhere.
But many of the customers visiting the city’s retail outlets downtown now come to shop at the district’s international brands, such as Apple or J. Crew, or the area’s upscale specialty stores like Thom Brown and Gant.
PRESSURES ON LOCAL BUSINESSES
In the process of bringing in high-paying tenants, UP has increased the business pressures facing downtown New Haven’s small, independent businesses.
Enson’s Inc., a men’s clothing retailer on Chapel Street, has operated in New Haven since 1924. The company’s president, Jim Civitello, has experienced firsthand the challenges brought on by the past 15 years of commercial development orchestrated by UP.
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“There is still room for small independents like myself, but it is getting harder and harder to do business,” Civitello said. “The national chains come in and they pay what I consider to be exorbitant rents, therefore they bump up the rents for all of us. It makes it difficult for the little mom-and-pop shops.”
Civitello said that in the past 10 years, he estimates rental rates in the downtown area have doubled.
In commercial retail environments undergoing rapid gentrification, the rising costs of doing business can, for some, become prohibitively expensive, said Kevin Wiersman, a realtor with New Haven-based commercial developer Colonial Properties. Wiersman said most landlords look to attract the highest-income tenants possible, and the tenant profile of an area as a whole can change when high-powered brands like Apple enter into the mix.
But aside from rising rents, some local store owners said the greatest business pressure comes not from the surrounding retail environment but from the power UP enjoys as a landlord.
Due to the size of its holdings and institutional backing, UP is able to exert total control over the commercial properties it owns, Hausladen said, adding that UP is known to carefully vet the tenants it selects for its storefronts.
Commercial developers and store owners in New Haven said that UP’s lease terms are “extremely landlord-friendly” and often include operational guidelines for businesses that maintain Yale’s high aesthetic standards for its retail holdings. For example, UP tenants are prohibited from using Scotch tape on storefront windows, and Gourmet Heaven is required to stock flowers on the pedestrian sidewalk on Broadway.
Rider said these policies make for a more aesthetically pleasing and shopper-friendly retail environment. But taken together, Yale’s strict lease agreements, exclusive tenant selection and vast property holdings give the University near-unilateral ability to determine the character of downtown retail.
“It’s no secret that Yale owns a lot of property and controls a lot of decisions downtown,” said Ward 3 Alderwoman Jacqueline James-Evans. “Yale’s dominant influence in shaping downtown retail is definitely a concern, especially because there is no counteracting effort to voice the opinions of locals.”
In 2004, Rita Catel and her husband, the owners of Old Bins Bottle Shop on Whitney Avenue, tried to expand their business by buying a lease at UP’s property at 1092 Chapel St., where Chapel Wine, the tenant at the time, was closing up shop. Despite having obtained a permit to open a liquor store at the location, UP denied them the lease because it did not want a liquor store as a tenant.
It would not be the only liquor venture to be blocked by Yale. In November 2011, UP declined to renew the lease of Broadway Liquor, forcing it to move from its 9-11 Dixwell Ave. location, which UP had purchased that month. While within its legal rights as a landlord, UP’s decision infensfied Catel’s fear for the future of her business.
“In our [neighborhood], the majority of the properties are owned by Yale. If my building ever got bought by them, where will I go? I’ll have to close my door and I’ll be out of my business,” Catel said. “We will always live with that fear.”
YALE AS A LANDLORD
Other retailers have complained of UP’s willingness to let properties sit vacant until it finds an ideal tenant, arguing that empty storefronts can hurt businesses currently in the area by decreasing foot traffic. One of the most drawn-out conflicts between Yale and its tenants began in 2002 with the former owners of the restaurant Bespoke — since replaced by Gilt — on 266 College St. Both UP and the owners, Suzette Franco-Camacho and her husband, Arturo, claimed ownership over a sliver of land behind the restaurant.
After a seven-year legal battle, UP issued the Franco-Camachos an ultimatum: If they did not concede, UP would not renew the lease for the couple’s other New Haven restaurant, Roomba on Chapel Street. Facing rising legal costs, Suzette Franco-Camacho said she and her husband decided to sell off their New Haven restaurants and leave the city.
“There was no sense of ‘reason’ that came out of any conversation or action regarding this dispute. We were given just 30 days to vacate after approximately seven and a half years, never once with a late rent,” she said. “UP resorted to [punishing] us in the one way they could, by ending Roomba — that hole or void is echoed in our lives as it was a first restaurant, the one we will always love the most.”
But despite this and other disputes, other tenants maintain that UP is a good landlord, often going beyond what is required in its efforts to create a strong commercial environment.
“UP is always the first landlord in New Haven to do things like shovel snowfall or remove tripping hazards — they make an effort to create a place-making environment,” Hausladen said.
Many tenants also praise UP for the customer traffic it has been able to attract through the retail mix on Broadway and Chapel. Managers at the clothing store Denali on Elm Street, Enson’s on Chapel Street and Tyco Printing on Elm Street said UP has achieved a tenant portfolio that brings paying customers to the neighborhood, which is very positive for their businesses.
Claire Criscuolo, who opened Claire’s Corner Copia on Chapel Street in September 1975, said that despite the oft-cited cases of disagreement between Yale and some of its tenants, Yale and UP have built a “wonderful partnership with the city.” She added that in every case of eviction she has heard of, the tenant involved was either late on their rent or violated some portion of their lease.
Previous landlords, Criscuolo added, have not shown the same trustworthiness that she said UP affords its tenants. Before UP acquired Claire’s, Criscuolo said she discovered that her previous landlord was tapping into her water bill and using it to provide water for the entire building — a “tremendous breach of faith” in the landlord-tenant relationship.
“Conversely, UP came to me over three years ago and found out we were overpaying a portion of our lease and returned to us a very large amount of money which we would have never found,” she said. “Honestly, integrity means everything to me, and with Yale we’ve been very grateful.”
PRICING AVERAGE RESIDENTS OUT?
In a city where, according to the 2011 U.S. Census, one in four residents lives below the national poverty line, UP has been able to leverage the financial strength afforded by the world’s second-largest university endowment and commercial demand by Yale students to create an upscale retail district. And although these offerings and the jobs they bring are “definitely an asset for the city,” Hausladen said, the changes it took to bring them to New Haven have not always been well-received.
Eleven out of 16 New Haven residents interviewed said there is a widespread perception that the retail along Broadway and Chapel Street primarily serve the Yale community, not New Haven residents as a whole.
“Yale definitely is not here to cater to the average resident, by no stretch of the imagination,” Alderwoman James-Evans said. “The average New Havener cannot and will not shop with the downtown’s high prices, and some people say it was planned that way.”
Morand contested the concern that the Broadway and Chapel retail districts are too pricey for local residents. He said these areas offer “more mixing and accessibility” than most downtown urban environments, which, coupled with publicly accessible Yale theaters and museums, make for a shopping area that offers something for everyone.
Others, including Hausladen and Lance Freeman, an associate professor at Columbia University who specializes in gentrification issues, said that urban environments always contain pockets of wealth disparities, and, over many years of development, it is not surprising that such contrast can become controversial.
Still, Morand said UP’s investments are in fact creating the environment that locals want. For instance, he said, while some residents may criticize Broadway as having too many national brands and too few local retailers, big-name brands are necessary to attract the sustained foot traffic that can then support the further growth of small businesses.
Regardless of the resentment that Yale’s retail property developments have caused among some in the local community, most city officials, store owners and commercial developers interviewed said UP’s efforts have improved town-gown relations from a long-term perspective.
“I think the University having control of what businesses go in around its campus is smart,” said Criscuolo. “Yale has been working to make New Haven a better place that’s healthier for students and residents.”
Beyond attracting new shoppers, Rider said that a thriving downtown is also critical for the University to draw prospective students. The well-being of the University and that of New Haven are “inextricably linked,” she said. In order to attract world-class applicants, Yale needs a “world-class city.”
Five prospective students interviewed who are currently deciding whether to matriculate at Yale echoed Rider’s sentiment, saying that the quality of a university’s surrounding environment is an important factor in the decision of where to go to college.
For Apsara Iyer, a high school senior choosing between Yale and Harvard, that decision is playing out right now. She said the commercial vibrancy and safety of downtown areas are weighed by both parents and students during college admissions, and she believes a “holistic approach to deciding where to attend” is best.
“The atmosphere of not just what’s on campus but also nearby will factor into the decision,” said Iyer, who is currently in New Haven for Bulldog Days.
Iyer is not alone in considering the character of Yale’s surrounding neighborhood as part of her college decision. According to Mike Gordon, director and lead consultant at IvySelect College Counseling, a private education consultancy group, deciding where to attend college is “to some extent, similar to buying a house.” The environment around campus, he said, can be a “compelling piece of the puzzle.”
Going forward in its mission to “grow the tax base of New Haven,” Rider said UP is seeking to expand the blend of tenants it has been able to achieve over the years through a strategy of “pioneering retail.” This method, she said, entails introducing retail development to the street level of buildings such as parking garages and institutional facilities. She said one example of pioneering retail is the commercial space in Science Park, where Winstanley Enterprises, a New England developer, and UP are partnering in the redevelopment of several long-abandoned buildings, including the old Winchester Repeating Arms factory.
“This sort of pioneering is not an easy task, as in many cases the areas we are trying to populate with retail have not traditionally been retail or viewed as potential retail areas,” Rider said. “In the not-too-distant future that will be thriving, fully occupied retail.”
While downtown New Haven’s renaissance is well underway, Adler said improvement in its reputation continues to lag behind reality.
“I do still hear people say things like, ‘New Haven is pretty rough,’” Adler said.
And as UP continues to expand its footprint in New Haven, it is unclear where the University will decide its interests as a developer end.