Retailers race toward city locations and smaller stores

Last September, the upscale grocer Whole Foods opened a two-story outlet in a 13-story building at the edge of the George Washington University campus, just steps from the Washington Metro system’s Foggy Bottom subway station.

In the street level of the 36,000 sq. ft. store, customers find prepared foods, a café, bakery, and flowers. Take the escalator, stairs, or elevator to the basement level and they reach the other half of the operation: groceries, produce, meats, poultry, fish, cheese, wine, and beer.

A two-story food store? This is a prime example what Robert Gibbs says about retailers these days: They’re heading to the cities and they’re often willing to break all the rules they had previously imposed on their operations.

Multi-story layouts. Smaller footprints. Parking on the roof or in the basement. Lower ceilings (when using certain older buildings). Those are all possibilities. The store in Foggy Bottom—in a building containing 335 apartments above, offers free parking for 90 minutes, in an underground garage. Many of the customers don’t need it; they arrive on foot or bike or public transit. 

The collapse of American homebuilding that began in 2007, and the global financial crisis of 2008, have impelled retailers to look for different

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