The economic downturn has claimed two more victims, this time a much-loved coffee shop and its companion store in Alamo Plaza.
In a recent letter, Mike and Lauren Duensing, owners of Yellow Wood Coffee and Tea and its sister store, Sage, announced they will be closing Sept. 23. With the closing, there will be 14 vacant stores in the plaza.
The coffee shop, which has been dubbed the town hall of Alamo, opened in 2005 and was doing well until 2008, when the recession hit, according to Lauren Duensing, who said it struggled and yet was once again on the brink of success when Wells Fargo bank moved from next door to across the parking lot.
That, she said, was the straw the broke the camel's back. Duensing said people would often stop at the bank, get cash and walk the block.
"Retail is all about foot traffic and a tenant mix. We had a bank and Katrina Rozelle, an award-winning cake maker, we had a boutique by the name of Sage which we also own, next is Yellow Wood, next, Lawrence Meat Market, and then last, Richards Crafts," she said. "That's a beautiful tenant mix, with the bank."
Although the bank is just across the parking lot, about a football field away, Duensing said that was all it took to divert traffic away from the block and away from her stores.
Now, Yellow Wood and Sage are behind in rent and Duensing said the only thing that could keep the two stores open is a concession from the landlord. That's something she's been lobbying for, without success.
Duensing said she'd even made a trip to San Francisco to meet with Art Fong, the manager of Invesco, the company that owns the land.
"He was a nice person," she said. "It's important -- people want to point the finger at somebody, but the truth of the matter is it's a huge corporate system that doesn't allow (for) individual circumstances or small business circumstance. Our business cannot pay the same rent as Wells Fargo or Starbucks or Peet's. Our margins aren't as high."
Duensing is hoping to have the rent cut in half, and to get reimbursed for investments made to the shop, like the $50,000 she said was spent for the patio and the $15,000 air conditioning system.
While Yellow Wood is not the only store going under -- a 30-year tenant, Furbelos Fabrics, recently closed -- Ken Pearce, who co-owns Katrina Rozelle next door with his wife, said the management company had to make some tough decisions.
Pearce said the property managers have to decide which stores will survive the downturn.
"They're not going to give back huge amounts to the non-survivors," he said. "Overall, I see them trying to run to the larger corporations if they can."
Those companies, he said, are better able to carry the load for a store that doesn't do well to start.
Pearce said that doesn't mean the property managers haven't worked with business owners.
"Five years ago, they'd just dictate what they thought would happen," Pearce said, adding that included automatic rent increases. "Nowadays, it's 'tell us what you need and we'll see if we can help.'"
And while Pearce said property managers "totally understand what the situation is," some stores aren't going to make the cut.
Even though Katrina Rozelle is in a unique position, with the bulk of its income from high-end wedding cakes, the store has seen a 6 to 8 percent drop in business, people walking from the bank who stopped in for a cookie or cake.
Duensing admits her stores are probably on the list of those that won't survive.
"What they would say is we're a business that's in the death flight. We're behind on our rent, we're not catching up -- we look like a bad tenant. We show up on the delinquency reports," she said.
Meanwhile, Duensing is doing all she can to influence Invesco, including proposing an "edgy" marketing plan, like the one that kept her stores open for the past few years.
"One thought was hire me, hire Lauren, to bring to this plaza what I brought to Yellow Wood. Use the marketing fund locally," she said. "Yellow Wood has won awards, Yellow Wood is a noted spot in this community. Let's do the same thing with Alamo Plaza."
There's also been a letter-writing campaign, with what Duensing described as hundreds of letters, including one sent on behalf of the CEO of Safeway, which has a store in the same plaza.
Customers are already mourning the loss.
"It's a good place to sit down and have a conversation," said Karen Lanfranki. "I enjoy the patio."
Her husband, Tom, said Yellow Wood, which has water dishes outside, was a frequent destination when he walked his dogs.
Outside, two young men immersed in a conversation weren't aware of the imminent closing.
"The only reason I come to this plaza is for this place," said John Martin, who said he'd been coming to Yellow Wood for about a year.
While they could open a store in a different location, Duensing said, "Our heart is in Alamo."
She's still hoping for a compromise.
"We're open to something that the landlord and property manager might suggest that we haven't thought of," Duensing said, adding that she wants Invesco to "come to the table."
"There's room for compromise but I would say they're firm," she said. "You can't suck water out of a rock, but compromise needs to reflect the real economic condition, which is reflected in real estate values and rent rates."