Sometimes there’s no need for walls to talk: a scent can be a strong enough reminder of the past. And it is precisely that past that Jamestown Properties bought into when it acquired historic Ghirardelli Square in San Francisco’s Fisherman’s Wharf area earlier this fall. Although the deal size was not disclosed, local media reports estimated that the Atlanta-based fund manager paid about $56 million for the retail square, taking it off the hands of Ghirardelli Acquisition, an entity controlled by the Royal Bank of Scotland.
The 100,394-square-foot lifestyle and entertainment retail complex sits at 900 North Point Street and includes 12 buildings – the tallest of which is no higher than five stories – leased to mostly small-scale local tenants, such as accessory shops ElizabethW and GiGi + Rose and food boutiques like Kara’s Cupcakes and Wattle Creek Winery. There is one exception: in the Clock Tower building sits Ghirardelli Soda Fountain and Chocolate Shop, a name most people can recognize.
Still, Ghirardelli Square has endeared itself most in the hearts of locals as an historic site rather than a shopping complex. In addition, it is considered the first successful adaptive reuse project in the US, with a story spanning more than a century.
A different kind of gold
As a 20-year-old man, Domenico ‘Domingo’ Ghirardelli left his native Italy for South America, eventually settling in Peru as a coffee and chocolate merchant. In 1849, however, he joined his friend James Lick in California, lured by his friend’s tales of the gold rush. Lick had arrived in San Francisco the previous year, just 13 days before the first shiploads of gold rush pioneers.
Once in California, Ghirardelli tried his hand at gold mining, but he didn’t meet with much success. Then, true to his roots as an Italian confectioner’s apprentice, he discovered his own gold mine supplying mustard, coffee, spices and, of course, chocolate to his fellow miners.
In 1851, the Great Fire of San Francisco destroyed Ghirardelli’s original business structures, but not his vision. The next year, he established a confectionery company that was to become Ghirardelli Chocolate.
Between 1852 and 1895, Ghirardelli’s chocolate factory moved three times, its business growing to export its products all over the US, Mexico, Japan and even China. Three of Ghirardelli’s sons became partners in the business, and Ghirardelli himself finally retired as head of the company in 1892, just before his company bought the Pioneer Woolen Mills on North Point Street – the future site of Ghirardelli Square – for extra space.
In 1962, Ghirardelli Chocolate was sold and the factory moved to San Leandro, leaving the Square up for sale. Fearing it might be demolished, a group of San Franciscans purchased the property, commissioning an architect to “construct a specialty shopping center, retaining the original Victorian qualities of the complex.”
The renovated Ghirardelli Square officially opened in 1964 and, the very next year, it was declared an official city landmark. In 1982, the Square was granted National Historic Register status.
Past meets present
Ghirardelli Square’s rich – and tasty – history unfortunately has not been enough to keep the property afloat. Under continuous renovation, it was just 55 percent leased at the time of its sale to Jamestown, even though an estimated 12.4 million (75 percent) of the 16.5 million tourists that visit San Francisco each year pass through the Fisherman’s Wharf area, according to Jamestown chief operating officer Michael Phillips.
Local analysts have suggested that the tourism element will be crucial to restoring Ghirardelli Square to its former glory. Fortunately, Jamestown actually specializes in restoring high-profile, historic real estate for retail uses, with experience in that strategy ranging from properties in Manhattan to Atlanta.
As of now, Jamestown is planning a reported $15 million renovation program for Ghirardelli Square over the next two years. The aim is to “stabilize the asset and add new retail concepts and amenities that will distinguish this world-renowned property as both a neighborhood and vacation destination,” Phillips said.
To make Ghirardelli Square into the crowd-drawing retail and tourist attraction it’s hoping for, Jamestown will seek to balance preserving its historical character while incorporating input from locals for improvements. “In renewing the property’s stature, we will work with historic consultants and community stakeholders to create a lively mix of tenants that will fulfill the needs of a modern market while honoring Ghirardelli’s storied past,” Phillips said.
Some media reports have stated that a turnaround already is happening onsite. Indeed, there are only a few spots left to lease up and, on November 29, Ghirardelli Square hosted its 49th Annual Tree Lighting Ceremony, with sponsors including Verizon, singer Kevin Toqe and, of course, a visit from Santa Claus.