Small businesses can’t compete with high rent in Dupont Circle

On a breezy Sunday, vintage clothes, old paintings and jewelry mark the corner of 19th and Q Streets. 

Dozens of people stop, meander and look through all the items on sale at the weekly Dupont Little Flea Market. John Harvey is the proprietor of the market and rents spaces to other vendors, focusing on hyper-local Dupont sellers. 

“This is our main livelihood,” Harvey said. 

Harvey has operated the market for almost five years. He has added more vendors since opening, but said he is limited from growing much more. The market is limited by available physical space on the sidewalks and by economic factors impacting his ability to open up a brick-and-mortar store. 

“I think it’s really impossible for a business like mine, as successful as it is here, to do this sort of thing storefront-wise the city just doesn’t to my knowledge, it doesn’t really work with us,” Harvey said. “Certainly, the landlords don’t.”

Harvey said the rent prices in Dupont Circle are too high for his local business to succeed in a retail space. He said he’s seen landlords asking for $10,000 in rent, which is not plausible for his business. 

“I’m just not willing to take that risk,” Harvey said. 

A retail advisor at Coldwell Banker Richard Ellis (CBRE) in the District, Reilly Hudson, said the retail market in D.C. is coming back strong after COVID-19, so it can be difficult for local businesses to compete with more prominent brands for retail space. 

“There’s national credit tenants that are coming in,” Hudson said. “They’re very attractive to landlords, they offer awesome use that people love, and there are credit-worthy tenants. So yeah, it does create some challenges for more local users.”

A recent CBRE report found 143 select retail openings in the district and 72 closings this year. A similar retail report by real estate company JLL found Dupont Circle had 21 retail openings in the neighborhood and 19 closings since 2022.

However, walking through Dupont Circle, empty storefronts still line the streets three years after COVID-19. 

“It’s a busy corridor – but during the pandemic – it really did, like all parts of the city, take a hit,” said Ann Blackwell, the executive director of Historic Dupont Circle Main Streets. 

The Dupont Circle Business Improvement District Executive Director Bill McLeod said in an email that most rent prices in Dupont Circle range from $10,000 – $24,000, making it hard to fill some empty storefronts.

McLeod also wrote that landlords face a number of challenges that make it hard for them to lower rent for tenants. He cited high mortgage payments for landlords who bought commercial real estate in the years before the pandemic, high commercial building taxes and in Dupont Circle, he said small building owners also rely on rent payments for income and lowering it could have a “catastrophic impact on the family’s income.” 

Hudson also noted the retail business always presents challenges to keeping storefronts filled. 

“Retail is still a cutthroat business,” Hudson said. “It’s hard to run a store for a number of years. So there’s always going to be vacancy in our world.” 

Blackwell said Historic Dupont Circle Main Streets offers multiple services to help support small businesses in the neighborhood. 

“We offer consulting on DC grants and opportunities for small businesses,” Blackwell said. “We recently added social media and security consulting; business people want to know more about how they can better market their business or make it safe using security practices.”

The JLL report noted that the new business openings in Dupont Circle in the past year have mostly been food and drink establishments, which reflects the D.C. market as a whole. In the District, the report found that 71% of new businesses were bars and restaurants, while only 8% of new businesses sold apparel or accessories. 

Harvey said online shopping has also made owning a retail space difficult because the prices he sells his items at wouldn’t be enough to compete with the rent prices. 

“It’s really, really hard,” Harvey said.  “You want extravagant rents, but I can’t ask a lot because all they have to do for this Italian oil is go online and order it from Amazon tomorrow. So I can’t even get the prices that would allow me to pay rent and pay my staff,” Harvey said.