Food Hall Site Selection

Nur Asri is an Associate at Larisa Ortiz Associates

Earlier this month, Cushman & Wakefield released a report titled, “Food Halls of North America”. Since their first report on the trend in November 2016, food halls have grown exponentially all over the country, and especially in New York (see #5 of our 2018 trends list).

The report lists twenty five different food halls in New York City (we’ve left out Essex Street Market because it’s an institution we’re more familiar with as a public market, more on this in a previous blog) but guess where they’re mostly located? That’s right, Manhattan. 

80% of the city’s food halls are located in Manhattan.

Source: LOA

Drawing a 5-minute walking radius around each of the food halls, I took a closer look at the demographics and worker populations surrounding these food halls to figure out why Manhattan is continuing to draw this attraction.

Source: LOA

When compared with food halls located in Brooklyn and the Bronx, those in Manhattan were situated in neighborhoods with higher population density, higher median household incomes, higher educational attainments, and higher proportions of Millennials aged 25-40. These are unsurprising facts for anyone who lives in the city but if you’re elsewhere looking to attract a food hall operator; these are just some of the criteria your downtown or neighborhood may need to offer.

The psychographic tapestry segments that dominated the food hall neighborhoods in both Manhattan and Brooklyn were ‘Laptops and Lattes’, ‘Trendsetters’, and ‘Metro Renters’ . These groups, as you can imagine, are all made up of high-earning, well-educated young professionals who are socially and environmentally conscious, technologically savvy, and enjoy discovering local art and culture and dining out.

Given that food halls are highly-curated cultural hubs for new and old restaurateurs to test food concepts and set trends, having an educated audience that seeks this type of experience and is hyper aware of the nutritional value of their food would be highly beneficial and complementary to the mission of food halls. These are the same customers that will likely come in to a food hall and Instagram their meal and night out, driving greater marketing and sales.   

Speaking of dining out – I also found that residents living near food halls in Manhattan spend more eating out annually than those in the outer boroughs. The exception lies in DUMBO, Brooklyn where the upcoming Time Out Market is slated to open later this year. Within a 5-minute walk of the soon-to-be-opened food hall, households are spending an average of $6,091 annually on eating out. This is even higher than those residents living near Canal Street Market, American Market by Todd English, and Gotham West Market!

The high density of worker populations is another trait food halls seem to prefer. All the food halls located in Manhattan have between 20,000 to over 100,000 daytime workers within a five minute walking radius. In comparison, the food hall with the greatest day time worker density in an outer borough is Gotham West Market at the Ashland (Brooklyn) with only 16,353 workers within a five minute walk.

Photo: Lou Stejskal  (Flickr)

Meanwhile, in Manhattan, the top three food halls with highest worker population densities are all located in and around Grand Central Station (Urbanspace at 570 Lexington, Urbanspace Vanderbilt, and Great Northern Hall), where there is a strong cluster of banks and financial services offices and over 100,000 daytime workers. Furthermore, most of these workers earn more than $3,333 per month, indicating strong spending potential particularly during lunchtime and after work.

Even within New York City, there are nuances with where food halls are growing. Food halls in the west side of Manhattan– from Chelsea up to Midtown West – appear to be riding on the wave of high population growth rates. Populations around Gotham West Market and Hudson Yards Food Hall, for example, are expected to grow between 14-15% in the next five years (some of the highest rates in the city!). And the same can be said of the growth in food halls in the outer boroughs. Aside from Industry City, all the food halls in the Bronx and Brooklyn are located in neighborhoods with rates of population growth higher than their respective County levels.

So it appears that even if your downtown doesn’t quite have the traits that we’ve seen with the food halls in Manhattan (i.e. high population densities, high worker densities, etc.) but is undergoing a renaissance and seeing an impressive development pipeline of residential homes and offices, then maybe attracting a food hall operator is not completely out of order.

Like attracting all other tenants, however, it is crucial to first consider the types of residents and workers that will be entering these new developments, what their spending patterns are like, and if these align with the traits that food halls are craving.

Are their disposable incomes high?

Are they trend-seeking consumers?

Are they younger, digitally-apt customers that will continue to support and market the food hall?

After all, as we’ve seen, the food hall is not for everyone. And it’s certainly not for every neighborhood.

The Original Food Hall

Nur Asri is an Associate for Larisa Ortiz Associates

Hawker centers in Singapore go way back. Its history goes back to the 1950s and 60s when migrants took up hawking on streets as a quick and easy means of earning a living. However, the conditions in which street hawking was being carried out were bad – drains were polluted, sidewalks and roads were strewn with trash and as a result, vermin were a common sight. The government became concerned about the state of hygiene in the city and, in the style of Mayor Fiorello La Guardia’s campaign in the 1930s to rid New York City streets of pushcart vendors, began relocating street hawkers to facilities with proper sewers, safe water and electrical lines, and full kitchen and storage equipment in 1971. These are now widely known as hawker centers. Hawker centers are semi-enclosed buildings that house a variety of food stalls serving food, drinks, and desserts that are almost always prepared to order. Sounds familiar, no? Read: The Modern Food Hall 

In fact, there are a number of similarities between the food halls that have recently grown in metropolitan cities here in the US and the over 100 hawker centers in Singapore.

1. Size and Layout

Stalls in both food halls and hawker centers are small in size. At hawker centers, stalls typically measure no more than 80-100 sf each.

Also, the seating layouts of both food halls and hawker centers promote a sense of community. Seating is dispersed throughout both and are not assigned to customers so it works on a first-come- first-serve basis. This means that you might very well be sitting with strangers during busy lunch hours.

2. Tenant Mix

Hawker centers feature food from Singapore’s various ethnic groups – Malay, Chinese, Indian – and is a direct reflection of local inhabitants. In food halls, offerings are also diverse, however, they may be less organic and more curated. Some food halls, for example, brand themselves as chef- driven halls and provide offerings that are completely distinct from local residents’ tastes and preferences.

3. Employment opportunity

Both food halls and hawker centers provide great inclusive employment opportunities. Given the low barriers to entry (presumably the smaller spaces ask lower rents compared to full-service restaurants or cafés), many more aspiring food entrepreneurs are able to enter the culinary field via these facilities.

As reported by JLL, startup costs are much lower and lease terms more flexible in food halls than traditional retail leases. Lease terms for food hall vendors are typically one to two years, much shorter than the five- to 10-year terms that landlords command for conventional full –service restaurant spaces.

4. Social space

With more food halls being located in mixed-use developments and transit-oriented developments, they are also becoming more physically accessible to wide range of customers. This has also been thecase with hawker centers in Singapore. Many are located in residential neighborhoods or near transit stations and therefore has successfully served local residents, workers, and visitors.

As a result, food halls and hawker centers provide a great shared space for informal social gatherings, community events and programs. For years, hawker centers have served as meeting spots for the elderly during the day as they sit and enjoy coffee and toast. Families also gather on weekends to eat together without spending too much money.

However, despite these similarities, the modern American food hall hasn’t quite matched up to the hawker center of Singapore. There are stark differences between the two.

 

1.  Customer

Legacy Food Hall in Plano, TX famously tagged in posts on social media site, Instagram.

While food halls here in the US strive to meet the needs and preferences of a variety of consumers from low- to mid- price points, how many can really show a diverse customer base? Food halls here in the US often have carefully curated brands and marketing materials that, for the most part, appeal to millennials and mid- to high- income customer segments.

Meanwhile, in Singapore, the hawker center is the place where Singaporeans from across income levels and ethnicities gather to eat with purpose at all times of the day. At lunch time, business types, taxi drivers, students, and the elderly are all seen queueing for the very same Chinese noodles or Malay fried noodles. This is largely because price points are extremely low that customers run the whole gamut from blue collar to white collar and even the creative in-betweens. Everybody needs quick and cheap food from time to time.

The main reason that price points remain so low at hawker centers however is due to ownership and management.

2. Ownership/ Administrative Capacity

Today, the Singapore government continues to own the majority of hawker centers across the country.  Prospective hawkers have to bid for available stalls and pay rent to the government at subsidized rates. These subsidies allow product prices to be kept lower than that in shopping mall food courts.

Of course, I’m not saying that food halls should be government- owned and operated to truly achieve the diverse customer base it’s currently seeking but it’s important we realize that the profit motive of private food hall developers and operators are often misaligned with the community, economic, and social benefits that could be attained.

In order to maintain the mission of low cost culinary offerings for diverse customers, partnerships and support from public bodies or non-profit organizations must be built to ensure that food halls resonate with local customers and communities. These supporting bodies may even be able to offer complementary community programs at low cost and therefore attract a wide range of customers from the neighborhood. Diversifying ownership of food halls might just solve its issue of not quite reaching the masses in its current branded state.

A Response to APA17: The dangers of calling it a Modern Food Hall

One of the more popular sessions at the National Planning Conference last week was one titled “Modern Food Halls: Redevelopment Aid or Trend?” The panel discussion was led by Nicolia Robinson of Cooper Carry, an architecture, design and planning firm based in Atlanta, Georgia. Joined by her colleagues Sarah Jane Bonn and Daniel Sweeney, Nicolia led the discussion around one of the most talked-about trends in cities across the country. She opened the floor with a brief presentation on what the drivers of food halls were and attempted to distinguish them from what many of us recognize as food courts and markets.

Food Trends

In 2015, there were only 70 food halls across the nation. Last year, the panel cited that that number had risen quickly to 130, and by the end of 2017, we are expected to see more than 200 food halls across America.

This rapid growth in food halls, like restaurants, can be attributed to the rising trend of eating out amongst consumers. In an earlier post, we wrote about the fundamental and cross-generational shifts that have led to restaurant industry sales surpassing grocery sales for the first time in history. For food halls, the large proportion of millennials eating out more frequently is particularly driving its rapid growth and popularity.

On top of this, the panel claims that food halls are also meeting the needs of consumers who are seeking more “sophisticated and authentic flavors and experiences while dining out”. This has been echoed in recent media reports that claim consumers are “demanding more variety, better quality food while also seeming fatigued with the conventions and time investment of a multi-course, full-service meal” at traditional restaurants.

Defining Modern Food Halls

So what exactly is this food hall we’re all talking about? While the panel from Cooper Carry attempted to distinguish food halls from the traditional food court and market by delineating specific traits for each of these places, the lines began to blurry as they continued to dive deeper into case studies and examples. Before we begin to dissect the discussion around the definition of food halls, here are the characteristics the panelists attached to Food Courts, Markets and the newest hybrid, Food Halls:

Food Court	Market	Food Hall - Marries best of both food court and markets
Mostly national brands	Mostly local brands; mom and pop stalls	Both local and national brands (mostly local)
Fast food to fast casual	Ingredient-focused, produce-heavy stalls	Curated mix of tenants
Convenience		Plenty of gathering space (communal aspect)
Few retail options	Mostly Retail	Balanced retail and food

And here are the different ‘Scales and Types of Food Halls’ that have been observed by the panel:

Micro	Neighborhood	Destination
<10,000sf	10,000-30,000sf	30,000sf
Located in mixed use development, usually in difficult spaces to lease out to other operators

Food Halls

According to the panel, there are some key elements that make a food hall a food hall. First, there is often a heavily curated experience. The trouble with the ‘curated experience’ however has been that it is often targeted toward younger consumers that are more educated and have higher disposable incomes. After all, this is the demographic group choosing to live in urban, dense areas or in transit-oriented neighborhoods where these food halls are often located – key element number two.

Although this was not directly addressed by the panelists, several planners present in the room were rightfully wary of the implications of the food hall’s curated experience. Prices of meals at food halls, as one audience member noted, are often high compared to other available dining options. The noisiness and bustle of food halls also largely appeal to younger adults without children or elderly companions.

Panelists also noted that another key element is the detailed attention often paid to branding food halls as modern amenities and advertising them on social media. This seems troubling as it necessarily excludes certain groups of users from food halls, for example traditional older customers or non- English-speaking customers.

Finally, food halls are supposed to have a variety of authentic tenants. Although this was not clearly explained in the session, I would hazard a guess that this was in reference to locally-owned businesses with new food concepts.

There appear to be a number of problems or inconsistencies with the food hall as defined at the session. In fact, when the floor opened for discussion, many in the audience jumped at the opportunity to ask about the foreseeable economic and social impacts of food halls that was not addressed in the presentation. Issues raised by audience members included insufficient parking and seating space for large crowds, and finally, the elephant in the room – who are food halls for?

In response to crowded spaces, Daniel Sweeney quipped that while seating can be hard to find in these popular food halls, this can in fact be beneficial to vendors. The busyness of the food hall creates a vibrant atmosphere for visitors and makes the food hall appear to thrive.

 

However, when must the line be drawn before the crowds begin to cause discomfort for regular patrons, forcing them to find alternative options and potentially resulting in drop of sales for vendors?

In fact, Chelsea Market here in New York City already suffers this shortfall. As soon as the food hall began to primarily serve tourists and attracted crowds of out-of-towners (over 6 million national and international visitors annually), locals no longer found the shopping environment conducive for daily  needs. Today, many locals intentionally avoid this former neighborhood jaunt. It appears as though food halls run the risk of becoming a visitor attraction rather than a local neighborhood amenity. This very issue raised red flags for me when the panelists started to use Essex Street Market as a case study of a neighborhood food hall.

The Problem with the Food Hall Label

In the past few months, LOA has been working with the New York City Economic Development Corporation (NYCEDC) to create a tenanting and marketing strategy for Essex Street Market as it prepares to relocate to a new facility across Delancey Street. LOA developed a strategic market positioning statement for Essex Market that defined key customer segments before recommending strategies for attracting new tenants and vendors.

Essex Market is, by definition, a public market owned and managed by NYC EDC. It is not a food hall, nor does it aspire to be one. The market is New York City’s oldest public market following Mayor La Guardia’s efforts in the 1930s to clear the city’s streets of pushcarts and build a network of modern indoor public markets. For more than 75 years, Essex Market has been a fixture in Manhattan’s Lower East Side and an important source of affordable products for local shoppers, from Latino and Asian immigrants, to the new millennials who have recently began moving into the neighborhood.

The mission of the market remains to serve the needs of low and moderate income residents in the neighborhood and this can be observed by the mix of tenants at the market. Vendors such as Saxelby Cheese Mongers and Essex Farm Fruits and Vegetable for example accept EBT and offer products at low price points. Even as the market expands in size at its new facility, prepared foods vendors will remain a small percentage of the overall market tenant mix. Ingredients-based purveyors will continue to make up over 70% of the market, including specialty ingredients such as fresh coffee beans, American cheeses and traditional spices.

In addition, NYCEDC and the Essex Market management team, will continue to remain committed to scouting hyper local vendors to fill the remaining spaces at the new facility with preference given to vendor applicants offering farm-related or ingredients-based products. These tenanting strategies are intended to maintain Essex Market’s position as a public market with retail that contributes to the local community’s wellness through fresh, affordable food.

Although the panel had intended on showing the audience a positive example of a publicly-managed neighborhood food hall, they may have taken a leap altogether in labeling Essex Market a food hall. Let’s take a look at the criteria set by the panel for food halls and how Essex Market doesn’t quite meet them:

Food Hall	Essex Market
Both local and national brands (mostly local)	No national brands
Curated mix of tenants	Curated to the extent that EDC is maintaining 70% ingredients-focused, produce-heavy purveyors
Plenty of gathering space (communal aspect)	Yes in the new facility
Balanced retail and food	No - 70% ingredients-based retail

Given that there are already some implications associated with food halls, we need to be careful with the way we use the label. In a previous post on food-based developments, we began to explore some of these negative impacts.

“…when food-based developments do not serve the wider community, it stands to run into accusations of causing gentrification and rising property values. In Anaheim, California, where a former fruit packing and distribution center was transformed into a food hall dedicated to local vendors, it has quickly evolved into  a selling feature for new residential developments in the neighborhood. Broookfield Residential for example is hoping to “attract young buyers with units priced between $300,000 and $400,000” in a neighborhood that was once a sleepy town known only for Disneyland. Whether intended or not, the Packing House food hall in Anaheim has led to huge inflow of development into the neighborhood, raising prices of property in the area.

Furthermore, food halls that only serve ready-made meals or chef-made meals are often too upscale for the average customer. While they may help fill gaps in a food desert, prices often prevent lower income bracket groups from accessing these freshly-made and locally-grown foods since most prepared foods are not even eligible for SNAP benefits.”

For all of the benefits food halls claim to have as incubators for small, local businesses and chefs, there are plenty of other players in the industry that are simply abusing the trendy name for profit’s sake. Let's not call it a food hall, if it’s really a market or a food court. 

The Rise of Transit Retail

Bugis MRT Station.

Growing up in Singapore, transit stops were never simply places to catch a bus or get on the mass rapid transit. They were often also convenient places to pick up a quick sandwich, ice-cold bubble tea or even groceries. All across Asia, transit stations have been popular retail hubs for decades. Stations often offered a diverse mix of convenience retail and in some cases go so far as becoming shopping destinations in themselves.

The concept of transit retail, or retail at transit stations, is a “new frontier for retailers” in other parts of the world, particularly here in the U.S. Many chain retailers and commercial real estate brokers here are only beginning to view transit stations as viable locations for small format but high volume convenience stores. According to a recent report released by CBRE on retail expansion, one-fifth of brands from the Americas and the Middle East are targeting travel hubs as an emerging format for expansion, whether it be airports, commuter train stops, or railway stations.

Forms of Transit Retail

Transit retail does come in a variety of forms. They can be found:

Turnstyle Food Hall at Columbus Circle. Photo: Cristina U.

a) Before the turnstiles as in the case of Turnstyle at Columbus Circle, or

b) After the turnstiles like the newspaper kiosks on the platform of the West 4^th subway station here in New York City

West 4th Subway Newspaper Kiosk. Photo: Jens Schott Knudsen

They can also be found at-grade or below-grade, depending on the design and structure of the transit station. Personally, I have always had the greatest appreciation for the retail options found below-grade located just before the transit turnstiles. Thunderstorms during the monsoon seasons in Singapore were common so thousands of commuters like me would often seek shelter at these subterranean retail outlets, sometimes for up to an hour! This form of transit retail was also particularly useful on the hottest days of the year, and I would imagine will be equally functional during the extremely cold winters we face here.

While below-grade retail has the added benefit of providing shelter from extreme weather conditions, at-grade retail storefronts better serve surrounding neighborhoods and its residents. In London, the Earl’s Court Station served by both the Circle and District Lines best illustrates the opportunity that at-grade retail storefronts have to seamlessly connect transit to the rest of the neighborhood. The retail spaces that front Earls Court Road and that also mask the station from the high street, offer residents of the neighboring garden houses convenient retail and amenity including pharmacies, take-out restaurants, groceries, and financial services. While I was in college, I lived a block away from the transit station and always found myself picking up a couple of oranges or a bouquet of flowers from the local grocer situated by the station exit on my way home.

Designing at- grade and street-fronting retail bays however requires paying attention to local architecture. The retail-cum-station façade at Earl’s Court features buff glazed faience with green trimmings and all of the original windows of the station head house. This architecture allows the station to seamlessly weave itself into the old residential neighborhood with an ‘unbroken [historic] wall for pedestrians’.  

Tenant Mix at Transit Stations

In terms of tenant mix, transit retail mostly consists of grab-and-go items such as newspapers, magazines, coffee, packaged food, drugs and cosmetics. In a study by Yeates and Jones (1998), findings corroborated that retail tenants more likely to be located near commuter rail stations include coffee kiosks, quick food stands, and dry cleaners. Other typically observed tenants include banks, convenience stores, and pharmacies.

At more up-scale and new-build transit stations, the retail component is becoming more advanced, and is often transforming the stations themselves into retail and dining attractions or destinations. According to Robert Cervero, professor and chair of city and regional planning at the University of California Berkeley, this is very much like the Scandinavian model of TOD where the “transit station is not just a logistical node but also a place to go, in and of itself.” In some cases, transit retail outlets have also become hosts to special events and celebrations that bring in customers beyond just commuters.

The Oculus in New York City is a popular example of a transit station that has itself become an architectural centerpiece and also a shopping destination operated and managed by Westfield Corporation, the brand name of shopping centers worldwide. Oculus not only features the typical transit retail mix with its Starbucks and take-out restaurants, but also boasts European boutiques, jewelers, full-service restaurants and even an Apple store within its 365,000SF space. Pop-up retail merchandiser units or carts measuring about 48SF allow experiential and transactional retail concepts to change seasonally, encouraging fashion forward and trendy shoppers to visit. Likewise in Chicago, at the Ogilvie Transportation Center in the West Loop, MetraMarket is a 100,000sf street-level restaurant and retail development that offers neighborhood service and retail outlets such as CVS and CityFresh Market but also destination food hall, Chicago French Market.  

Benefits of Transit Retail

The mix of retail enables commuters and also neighboring residents the opportunity to have a one-stop shopping experience on the way home or on the way between places. As more people move from car-dependent locations to transit-served areas, the consolidation of trips—in other words, one-stop shopping—becomes a “sought-afterlifestyle factor” (CBRE, 2016).

Transit retail is also beneficial to transit authorities that are looking for an alternative revenue stream beyond just fares. In Hong Kong, the MTR rail corporation reported that in-station retail generates approximately $270 million annually. And in London, Transport for London, the city’s mass transit system operator, reported over $95 million in gross rental income in 2013 (NAIOP, 2015). As long as transit authorities negotiate leases on a triple-net basis and keep their role to the minimum of receiving checks and overseeing contract compliance, they will stand to gain form diversifying their revenue stream. While transit authorities may be concerned over littering and station cleanliness following transit retail, many testimonies have been given that counter that apprehension. Metropolitan Atlanta Rapid Transit Authority (MARTA) and Chicago’s Metra affirm that customers and tenants have respected the cleanliness standards given by the transit agencies. In fact, according to Denise Whitfield, MARTA’s manager of concessions, “riders respect the cleanliness of the system” and there has been no litter impact since the first phase of MARTA’s retail program was introduced in 2010 (NAIOP, 2015).

Finally, retailers definitely stand to gain from ‘captive consumers’ who have no choice but to stay at transit stations while waiting for a train or bus to board, or until the weather subsides. The critical mass of daily customers and the highly-trafficked locations at transit stops ensures that an adequate amount of minimum daily traffic supports retailers. Of course, the minimums may differ by geography. Where minimum daily traffic is not sufficient near transit stations, then retailers and transit authorities must ensure that there are other activities generating even more traffic in the non-commute periods.

Designing for transit retail

All over the world, transit retail formats are growing rapidly whether in new station developments or in old retrofitted stations. Paris’ Metro and London’s Underground are leading the innovative rehab pack by converting old subterranean mezzanines and ticket booths into small but viable retail spaces. Other transit systems may also soon discover that there are similar opportunities in underused spaces that can be converted into retail spaces for lease. 

Other resources:

Yeates, M., & Jones, K. G. (1998). Rapid transit and commuter rail induced retail development. Centre for the Study of Commercial Activity, Ryerson Polytechnic University. Retrieved from http://173- 254-37-135.bluehost.com/JSCR/IndArticles/Yeates_N298.pdf

The Food Hall Revolution

The retail industry has seen its fair share of trends and advancements this past year – ecommerce is up and millennials are driving experiential shopping. However, one that has inescapably stood out has been the development of food hubs and food halls all across the country. In fact, earlier in 2016, UrbanLand predicted that food was to be the ‘anchor of retail developments’ based on the rising proportion of store growth being attributed to restaurants. From Detroit to Irvine, cities and developers are catching onto the culinary-oriented developments in their own unique ways but are these places simply sexier, marketable versions of the traditional food courts? Let’s find out what constitutes food hubs and food halls and what impacts they are having on economic revitalization and food access.

Marketplaces have been a key economic, cultural, and social component of villages, towns, and cities for thousands of years and food, particularly fresh produce, has always been a vital commodity for trading at these markets. A food hub, as defined by the National Food Hub Collaboration and Michigan State University, is a “business or organization that actively manages the aggregation, distribution, and marketing of source- identified food products primarily from local and regional producers”. By doing so, food hubs bridge the gap between food producers and consumers and satisfy wholesale, retail, and institutional demand all under one roof much like traditional marketplaces. Today, many fresh food producers lack the capacity and financial resources to access these markets on their own so food hubs are indeed making it possible for these producers to gain entry into new markets, increase their incomes, and up scale production.

Not only are food hubs profitable to producers, distributors and retailers, they are also vital in improving neighborhood access to local foods by offering complementary programs and resources such as shared community kitchens for healthy cooking classes and food incubators for budding restaurateurs. All of these components that make up a food hub differentiate it from farmers markets that simply provide platforms for producers to sell directly to consumers like you, but what about the difference between food hubs and food halls?  

As it turns out, the term ‘food halls’ is increasingly being used interchangeably with food hubs. However, food halls are more often than not one of the many programs within a food hub (complementary to grocery stores, food education facilities, food distribution centers, and kitchen incubators). When food halls function separately and independently, they are often less community- and agriculturally-based. While they may claim to support locally-owned businesses and chefs, they often do not guarantee as tight a policy of local produce-sourcing as food hubs do given their varying administrative organizations and missions. Often, these food halls simply bring together multiple vendors, carefully curated to meet the targeted consumers’ taste and preference, and provide them space in high traffic areas at potentially lower rental rates.

Regardless of semantics, both food halls and food hubs are cooking up destinations for local food and providing opportunities for local businesses to grow – albeit to different degrees. Given the infancy of these food-based developments, we can only begin to predict their position as catalysts for redevelopment and socio-economic revitalization.

The Eastern Market in Detroit, Michigan, for example, demonstrates the potential for food hubs to be really sustainable and efficient food sources for communities. The food hub is the “largest historic public market in the Unites States” and has been connecting small farms with customers from metro Detroit for over a century. It has done more than just organize farmers markets for locals; the Eastern Market also hosts a massive wholesale market for local restaurants and grocers from midnight to 6am on weekdays. In addition, the market has incubator spaces for food entrepreneurs and provides professional kitchens for entrepreneurs who would otherwise be unable to access such resources. At Eastern Market, entrepreneurs can develop and test-market their products before expanding regionally. Take for example, McClure's Pickles. The firm got its start at the market and has since expanded nationally.

The Eastern Market not only meets the scope of a regional food hub but has certainly met its mission to “build facilities and critical infrastructure that fortifies the food sector as a pillar of regional economic growth while improving access to healthy and affordable food choices in Detroit”. A survey conducted by Michigan State University found that the majority of food hubs in Michigan helped increase access to healthy foods in underserved neighborhoods, thereby supporting a healthier population. More than 95 percent of Michigan's food hubs are experiencing an increase in demand of their products and services with restaurants, small grocery stores, and kindergarten through 12th-grade school food services being their number one customers. Furthermore, among the food hubs surveyed, about half of food hubs were equipped to accept federal Supplemental Nutrition Assistance Program (SNAP) benefits.

Food hubs also have the potential to act as arts and cultural centers for their neighborhoods. The large halls and spaces located in the hubs are conducive to art and design festivals. Eastern Market, for example, is home to the Detroit Design Festival every fall and many other creative pop-up events and programs. Like other food hubs, it is increasingly becoming a mixed-use building and yet food-based hub. Even food halls that simply feature chef-driven vendors and tenants are becoming arts and culture centers hosting a myriad of events throughout the year. In a time where millennial customers seek out unique retail experiences, the merging of the arts and culinary worlds was only an inevitable next step.

On the other side of the coin, when food-based developments do not serve the wider community, however, it stands to run into accusations of causing gentrification and rising property values. In Anaheim, California, where a former fruit packing and distribution center was transformed into a food hall dedicated to local vendors, it has quickly evolved into  a selling feature for new residential developments in the neighborhood. Broookfield Residential for example is hoping to “attract young buyers with units priced between $300,000 and $400,000” in a neighborhood that was once a sleepy town known only for Disneyland. Whether intended or not, the Packing House food hall in Anaheim has led to huge inflow of development into the neighborhood, raising prices of property in the area.

Furthermore, food halls that only serve ready-made meals or chef-made meals are often too upscale for the average customer. While they may help fill gaps in a food desert, prices often prevent lower income bracket groups from accessing these freshly-made and locally-grown foods since most prepared foods are not even eligible for SNAP benefits. So while food hubs and food halls may have a right to celebrate their contributions to the local food system and local communities, there are a few implications to also be wary of.

If that didn’t scare you enough, there are also a set of complex challenges involved in setting up and running food-based developments. Start-up, administrative and operational costs can run up high, especially when run by a nonprofit. Although finding capital through donations, grants, and city funding is a common strategy, these funding sources can easily go away. The many moving parts of food hubs also means that overhead costs can arise at all points on the operational chain.

Further still, site development has proven to be a huge challenge for food hubs. This is due to requirements for cold storage, space for processing food, distribution, and strategic marketing. The non-profit Boston Public Food Market, for example, is already spending close to $14 million to turn a state-owned building into a market.

Indeed, food hubs and food halls can take several years to achieve financial profitability. However, it is food hubs that work with various partners, including local farmers’ associations and school districts, which are able to increase their earnings easily by establishing distribution agreements.  These partners often also help with advertising and marketing efforts – lowering food hub overhead – and provide food hubs with a consistent yet diverse customer base.

On the other hand, food halls that function separately and independently with only chef-driven vendors open with 100 percent occupancy before quickly running into problems of high operation and marketing costs. This often leads to high lease rates for vendors. Since local entrepreneurs are particularly susceptible to rent charges and often are unable to make their businesses work in the long run without continued support from the food hall, these food-based developments hollow out and struggle to find replacement chefs.

As we move into a new year, and the trend of food hubs and food halls catches on rapidly across cities, let’s watch out for the saturation point in food-based developments. More importantly, let’s beware of its real impacts on food access and our local neighborhoods and communities.