Hunton Retail Law Resource

The Santa Barbara City Council, in an effort to combat the retail malaise on State Street in Downtown Santa Barbara, has approved a pilot program that would streamline the permit and review process for potential commercial tenants.

For prospective projects in the State Street area, the pilot program will include: (1) a dedicated phone line for questions regarding commercial space; (2) two designated staff members from the planning department to shepherd parties through the review process; and (3) priority placement of projects on the review board agenda. The pilot program will have an initial six-month term, but could be subject to extension by the City.

Because State Street is a major tourist and shopping area, its 30+ storefront vacancies have remained a material concern. Local retail establishments have been squeezed by online retailers, and the revitalization of State Street is one of the “high-profile” issues in the City’s upcoming mayoral race.

It is likely that only time will tell whether the pilot program will be successful. Certainly, by decreasing the transaction costs associated with building out tenant space for new leases, the City will be providing an additional incentive for retailers to lease space on State Street. However, it is an open question as to whether this additional incentive will be enough to allow brick-and-mortar retailers to overcome the structural challenges that they face in today’s economic environment.