Both Jacob Hensley and Lisa Gerben remember the moment nearly three years ago when Amazon.com Inc. announced its Crystal City pick for its second headquarters.
And both went to work — along with their real estate brokers — to be the new entry's newest neighbors.
Now, the pair has signed the first two retail leases for ground-floor storefronts in Amazon's (NASDAQ: AMZN) Metropolitan Park, HQ2's initial phase now under construction and expected to open in 2023. Hensley is bringing his pet care company, District Dogs, to the site, while Gerben will usher in her coffee shop, Rāko Coffee Roasters.
“I saw it and I thought, ‘This would be the perfect partnership for Rāko,’ which at the time was just a concept,” Gerben said in an interview, adding she started conversations right away with her brokers at KLNB. “I basically told them, ‘I’m really interested in pursuing this opportunity,’ and they worked very hard to help us put together a really great package for Amazon, and that’s really how it began.”
Both retailers will open in mid-2023. Rāko will take up 1,750 square feet on 14th Street, between South Eads and South Elm streets, while also operating a coffee kiosk in the Met Park office lobby. District Dogs will be located in 6,000 square feet spanning two parcels within Met Park on South Eads Street, between 14th and 15th streets.
Amazon declined to share lease terms. Overall, in National Landing, where the vacancy rate sat at 24.8% in the third quarter, gross asking rents rested around $38.27 per square foot, according to CBRE's latest quarterly analysis for Northern Virginia.
The tech giant worked with its development partner, JBG Smith Properties, in selecting the retail tenants, and it's talked in the past about focusing on underrepresented business owners, such as women and people of color.
“Amazon’s goal is to prioritize small, local, minority- and women-owned retailers for the ground floors of our office buildings and in unique retail pavilions throughout the HQ2 site,” Joe Chapman, director of Amazon Global Real Estate and Facilities, said in an emailed statement this week. “We want to help create an 18-hour district that people want to drive to, not just drive through, and the businesses we attract to this neighborhood will be a big piece of that.”
The global company's arrival, as well as new nearby residential development in National Landing — the area that includes Crystal City, Pentagon City and Potomac Yard — is expected to help triple the number of street-level retail storefronts in the vicinity, according to Tracy Sayegh Gabriel, president of the National Landing Business Improvement District. “Building authentic experience and loyalty and interest has a lot to do with the businesses that thrive in a community,” she said in an interview.
For Hensley, who founded District Dogs in 2014, it was a chance to locate near what promises to be a canine haven — that too, after a pandemic that saw a surge in pet ownership.
“We were aware that Amazon is a very, very pet-friendly workplace. I know there are thousands of registered office dogs in their Seattle campus,” Hensley, one of the Washington Business Journal's 40 Under 40 honorees this year, said in an interview. “I knew of the strategic benefit for District Dogs to move into this area.”
The Crystal City location will be one of District Dogs' bigger locations, joining others already open in Navy Yard, Shaw and Park View, with two more shops planned for 2022 in Northeast D.C. on Rhode Island Avenue and in Arlington’s Clarendon neighborhood. At each, the business offers services such as spa cleaning, boarding and puppy school, though the Crystal City spot will offer an additional training program as part of its pet day care.
Rāko first opened in December 2019, just before the pandemic, with a 5,000-square-foot specialty coffee roasting facility in Lorton. After the pandemic hit, Gerben, who founded the business with her sister, Melissa Gerben, pivoted to wholesale delivery of its single-origin coffee beans to restaurants, offices and catering companies through its e-commerce platform. Lisa directs the company's branding, while Melissa oversees its roasting operations.
“Our first introduction to specialty coffee was through our parents, who are specialty coffee lovers. We grew up drinking coffee from the time we were children,” Lisa said. “It’s always been an underlying dream of ours to open a coffee company.”
This past fall, Rāko ran a six-month pop-up coffee shop near Mount Vernon Square and now counts a presence in Studio Theatre in Logan Circle, working some of its concessions, as well as a cart in the Cannon House Office Building on Capitol Hill. It now operates a permanent location in Arlington’s Courthouse neighborhood with a menu that also includes small plates, natural wines and cocktails. That will be mirrored in the Crystal City location, though it will also sport its own design and menu.
“It will really just open us up to a customer base that we probably would’ve never reached before,” Lisa said. “It’s going to be a place that people live and work and go out. We believe that people will start and end their day at Rako because of our day-to-night concept."
Amazon said it hopes more locally based small businesses reach out — they can email localretailinquiries@amazon.com — to locate in both Met Park and HQ2's second phase, PenPlace, which is currently undergoing the site plan review process.
