City maker’s mark

Jesse Baerkahn is part lawyer, part real estate broker, part urban cheerleader

Jesse Baerkahn believes in cities. He feeds off their energy. And he knows that unique, vibrant, inviting urban spaces don’t happen by accident. Quality urban neighborhoods take thought and long hours of work. They need champions whose job it is to steadfastly avoid the quick, easy path.

Baerkahn works in urban placemaking. It’s his job to celebrate a strong sense of place in urban neighborhoods, and to eschew formulaic, big boxy sameness. He uses clusters of local retailers to anchor ambitious economic development projects. This takes some work. American cities are enjoying a widespread renaissance. As people and investment shift away from the suburbs, there’s a real danger of crowding out the vitality that underpins the urban comeback. Baerkahn believes that the future of cities depends on actively guarding against the suburbanization of urban spaces, and deepening the things that are driving the urban renaissance in the first place. He’s the founder of Graffito SP, a Cambridge- and New York-based consultancy firm whose tagline is “cities + food + arts + people + context + creativity + responsibility (or something like that).” It’s the sort of whimsical branding that’s typical of such firms, but it also captures some of the challenge Graffito takes on in trying to weave together the complicated web of connections that cities draw on for their vitality.

Graffito SP’s work is rooted in real estate, but the firm doesn’t do a traditional transaction-based real estate business. Baerkahn is part lawyer, part real estate broker, part urban cheerleader. His main job is acting as a translator between small businesses and landlords and local government, helping them understand how to use food and small-scale retail and the arts to foster economic development. He uses real estate deals as a tool for developing small businesses and fostering urban vitality; he’s far less concerned with the fate of individual storefronts than the feel and function of whole neighborhoods.

Baerkahn, a 33-year-old Winchester native, backed into his current work in urban real estate. When he went to Northeastern University’s School of Law, his plan was to set up a practice working with small owner-operated businesses. His big break appeared as an attempt to subsidize his fledgling law practice. In 2007, the real estate developer Alex Twining had just built the first new large-scale residential complex in Cambridge’s Kendall Square in ages, and he wanted Baerkahn to help market it to young, MBTA-bound residents. Along the way, Twining tapped Baerkahn to help fill the building’s first-floor retail space —space no traditional retailer would touch.

“The key was, it couldn’t just be one storefront,” Baerkahn says. “You had to change the neighborhood.” So after plugging a pair of locally-owned restaurants into Twining’s space, Baerkahn worked to turn around Kendall Square’s reputation as a suburban office park that existed within the city limits, and went dark after 5 pm. The area cried out for some life. Everyone with a stake in the neighborhood—Cambridge residents and city officials, companies renting space in the square and their landlords—wanted to turn Kendall into a vibrant neighborhood. But none of them knew how to put the pieces together.

Baerkahn worked with Kendall’s business interests on a coordinated retail campaign, plugging small, locally-operated businesses into the area’s empty storefronts. He placed a heavy emphasis on food, and on basic amenities like dry cleaners and day care centers. An influx of chef-centric restaurants has brought Kendall’s techy vibe out of the office towers and onto the street, and turned the neighborhood into a culinary destination. The retail placemaking project has also been a strong value proposition for Kendall’s landlords; they’ve subsidized their ground-floor retail and more than make back the retail subsidy on their upper floors, from companies crowding into the suddenly-hip neighborhood.

Beyond Kendall, Baerkahn has worked throughout Cambridge, Boston, and New York. He envisions his new venture, Graffito, as a consulting shop that’s also capable of investing directly in real estate development projects. He now splits his time between Brooklyn and Cambridge.

I spoke with Baerkahn at the next phase of Kendall’s placemaking project—a restaurant and urban market dubbed Commonwealth. The restaurant and market marks a homecoming of sorts for Baerkahn: It’s taking shape at the base of Alex Twining’s new residential tower, just in back of the building that brought Baerkahn to Kendall Square six years ago. What follows is an edited transcript of our conversation.

—PAUL McMORROW

commonwealth: How would you describe your job? What is it you do?

baerkahn: I work on exciting urban projects, transformative, urban placemaking projects. Transformative sounds like a big word. Maybe impactful? I’ve spent a lot of time writing, researching, and doing legal work from the tenant perspective, and I’ve spent the last five years primarily focused on the landlord perspective. The idea is to combine those two. The core thing I’m doing is acting as a translator between these small, local owner-operators and these large institutional landlords, to the extent they want to try to do business together in an urban setting.

cw: Explain what placemaking means to you.

baerkahn: I think placemaking is about activity. It’s about context. It’s about energy. In the urban setting, it’s about how to make a lot of very different uses synergistic where they meet. It’s about making these connection points interesting. There’s an element of making things different. To make an interesting place, it has to be different than other places.

cw: How so?

Baerkahn, a Winchester native, is part lawyer, part real estate broker, part urban cheerleader. baerkahn: Great places are specific to the unique context. So a great place in Kendall Square is unique from Harvard Square, because of the circumstances of that specific place. Even though it’s in the same town, two Red Line stops away, it looks different, feels different, functions different.

cw: It’s the opposite of the geography of nowhere.

baerkahn: My concern about retail development over this past three decades, and certainly since the ’90s, is it looks the same everywhere you put it. Increasingly, as larger institutional developers start refocusing in urban areas, and as people come back to the cities, the real threat is that we bring this formula that has worked in the ‘burbs into the city. I honestly think that’s a threat. Regardless of what happens on the ground floor, cities are going to function differently than suburbs. The retail should actually be in a different form than in a suburban setting.

cw: The retail is key here, right? That’s the argument, that the retail needs special attention, because the activity isn’t happening on the 12th floor, it’s happening where the building meets the street?

baerkahn: Exactly. The other thing is, in a really dynamic urban neighborhood like Kendall Square, to the extent something interesting is happening upstairs, how do you take some of that energy and put it on the ground floor? That’s the identity question.

Jesse Baerkahn inside Commonwealth, a restaurant and urban market under construction in Kendall Square.

cw: We’re sitting in a half-built restaurant here. Amazon and Google and MIT are across the street. Tell me how this place taps into the flavor of Kendall.

baerkahn: This space is unique for a bunch of different reasons. One, this deal was done with a chef-owner [Steve “Nookie” Postal] who lives in Cambridge, who has three kids who will be in Cambridge schools, and is invested in this community in a way I can’t imagine any other entrepreneur would be, both physically and emotionally. I think that’s important. We’re sitting in what will be a green urban market. I know when Nookie first thought about opening a restaurant in Cambridge, opening a market certainly wasn’t on his radar. This market came together because the landlord, the neighborhood, and the city said, we need this in this neighborhood. We have residential, we have office, there’s no place to buy eggs. Nookie was willing to tweak his business model. Nobody’s been able to get a fresh head of lettuce in Kendall Square in forever. Now it’ll be here. That decision was driven by the demands of the specific neighborhood, and there’s no way any formulaic business, any multi-unit chain, would have taken a market seriously. It doesn’t fit within their cookie cutter.

cw: You’re talking about involving government, neighborhood groups, civic forces in a deal that’s typically a transaction between a landlord and a tenant. It’s a totally different model.

baerkahn: A lot of the landlords in Kendall have bought into the argument that it shouldn’t be about one specific deal between a landlord and a tenant. How does the space fit within the larger context of the neighborhood? There have to be conversations with the community—the people who are living here, the people who are working here. The city of Cambridge has been a real advocate to help us understand what the public wants. There’s a likelihood of success when you’ve already gone to the neighborhood and the city and said: What do you want?

cw: Is there also a market research component there? You’re telling a landlord, this is where the demand is.

baerkahn: For obvious reasons, a lot of these landlords are not here 24 hours a day. These landlords have to rely on all the data that exists in the communities that have been here for decades, and, in that way, the East Cam¬bridge community has been super helpful in telling me, and these landlords, what the neighborhood wants. And they’re usually right about what the neighborhood needs. And they’re the ones who are going to support it. Also, there is this unique role of restaurants. There’s an element of how does it work for people who live in Kendall Square? But it’s also a question of how do you draw new people to the neighborhood to create a dynamic place? In the urban setting, the most successful retail is not all about the density that lives and works there, it is about drawing other people in.

cw: Let’s talk about what Kendall looked like when you got here, what the objectives were, and how the place looks and functions now, compared to before.

baerkahn: There was really very little that was unique on the ground floor. There was very little that was interesting enough to draw in people from outside Kendall Square. We spent the first six months not marketing any specific space, just marketing the neighborhood. It was helping businesses understand we’re next to MIT, on the Red Line, on the river. Those three things alone are huge. Then you layer in all this office space, this residential. We had to create activity on the ground floor that was unique, interesting, attractive to folks who lived and worked here, but also interesting enough that somebody who doesn’t live or work here would come over. Once you start getting people who don’t live and work to visit, that’s when I think placemaking starts to kick in to another level. I’m not traveling from suburb X to suburb Y because they’ve got a better strip mall. Because I can get the same damn thing in my own town. But I am coming from Allston or Harvard or the ‘burbs to Kendall now.

cw: What were those initial conversations like? Kendall had this reputation for years as a suburban office park that happened to be in the city.

Baerkahn’s latest project is in the base of Alex Twining’s
new residential tower in Kendall Square.

baerkahn: At first it was a lot of cajoling and dragging. People didn’t know where it was! I would go to these restaurateurs who had businesses within two miles. I showed them the map and they couldn’t point to where Kendall was. I talked about why this was a really unique neighborhood, why I believed in it, why some of the biggest institutional real estate investors in the country were making investments in Kendall Square. It’s the same reason that some of the great chef-centric restaurants and retailers should’ve been looking at Kendall Square. The second conversation was usually, after they’d said they’d drive through, they’d call and say, well, there’s nothing there. And that’s the point, right? They’d drive down Third Street, or they’d try to find their way to Ames Street, and they’d say, I didn’t see any neighborhood there. So that was challenging.

cw: How long did it take for this project to gain a critical mass? How many places had to open?

baerkahn: The first deal was huge. That was the first hurdle, for somebody who had respect within the small business community to come in and invest in Kendall Square. And then to gain traction, in truth, it was the Area Four deal, up in Tech Square. It was this no-man’s land for a really long time, and then you had this critically acclaimed, really dynamic chef who said, we’re going to Technology Square, across the street from a vacant warehouse and a research facility. People started to notice. The landlords realized they had put their money where their mouth was. People took me seriously because I could say, look, these landlords believe in this, they know it’s going to take some time, but they’re willing to invest and structure deals that are really sensitive to your business, especially in the first couple years.

cw: The other part of this was, what the landlords were doing before wasn’t working for them, or for the neighborhood, correct?

baerkahn: They knew they had to do the right thing on the ground floor, they knew it was the right investment, but some of them didn’t know how to do it. It goes back to the translation piece. We know what the city wants, we know what the landlords want, we know what the neighborhood wants, but how do we actually execute? A 1,200-square-foot coffee shop with a local entrepreneur is a harder deal to get done than any big box retail deal in the country. It was just about helping these landlords figure out how to do it.

cw: And now, they see the return, there’s more demand on the office space, better office space pricing that makes up the investment below.

baerkahn: Why is Biogen moving from the ‘burbs back to Kendall Square? They want to be in an interesting neighborhood. All things being equal, if an employer can offer a similar job in a much cooler place, everyone’s going to that cooler place.

cw: That’s what’s fundamentally underpinning this whole urban renaissance to begin with: All things equal, the quality of the space you’re in matters.

baerkahn: If you ask somebody where their favorite place is, everyone can say, Oh, I love these five places. If you ask them why, they talk a lot about how it felt to be in those places. As opposed to exactly what’s in those places. The connection is, they’re active, interesting, unique places.

cw: The implication is active, interesting, unique places don’t just happen, they need thought.

Lowell will never have Boston’s density, but it could be a really interesting place. baerkahn: Most unique urban places in the globe, frankly, have developed very organically. Central Square [in Cam¬bridge] is quite interesting and quite attractive for a lot of folks. There was no master plan there. The question is, how, in a relatively short amount of time, can you find a way to create a unique experience that’s really attractive from a place perspective, when you don’t have many decades to just let things roll? That’s the answer Graffito SP is trying to figure out. I haven’t figured it out. Everybody talks about Chelsea Market in New York, and they just want that. Well, Chelsea Market took decades to develop into what it is today. Now it’s highly profitable, Google’s in the building. It wasn’t always like that.

cw: And even Kendall, which has been relatively quick, took how many years?

baerkahn: I dug into Kendall six years ago. And we have a long way to go. A really long way to go. We’re just starting to get traction now. More specialty shops are interested, which was certainly not the case two years ago or five years ago. It’s never going to be an amenity shopping district, but we have the chance to bring in things that aren’t just restaurants.

cw: Let’s talk about the Seaport in Boston a little bit. You worry the Seaport could be a suburban-feeling place in the city, which would be a lost opportunity?

baerkahn: Physically, it’s exceptionally unique because of its positioning to the city and the water. If you dump a retail district in there that’s no different than a retail district in the suburbs, if it’s the same as something in Jack¬son¬ville and Dallas just sitting there in Boston, I would consider that a failure. The built form of the Seaport should be unique to the Seaport. I think the Fort Point Channel is really interesting. People are drawn there because it’s unique, both physically and in terms of what’s on the ground floor. The question is, can you get something that’s uniquely Seaport? And my concern would be, you get something there that actually has nothing to do with the Seaport, or the neighborhood, and has everything to do with a prescriptive model of what a retail district should look like in modern America.

cw: Because those types of deals are easier for landlords, and the model you put into place here takes more thought, more effort, it happens more slowly. And requires different thinking on the financing end, right?

baerkahn: These type of deals take a long time. One of the challenges of growing a business solely working as a broker to get these deals done is it isn’t necessarily scalable or profitable, because of the effort that goes into getting some of these deals done.

cw: So in terms of the incentives on the broker side, the landlord side, everything’s stacked against doing the right thing. And you’re trying to build a business out of going the opposite way.

baerkahn: We’re asking, what’s the right use? What’s the most interesting thing we can do? And then let’s go after that. Oftentimes, the best thing for the neighborhood from a retail development perspective is certainly not the easiest. Brokers aren’t incentivized to do the hardest thing. It’s exactly the opposite. That’s why a lot of great urban places are typically done by ownership. Ownership has different incentives. If you’re able to say, let’s make the ground floor really special and really unique because I can justify charging an extra $5 per square foot on floors two through fifteen, all of a sudden you’ve solved your economic riddle. It’s harder to do with a one-story retail building. That’s a riddle I’m working on.

cw: You work mainly in Cambridge and Boston and New York. How does your work scale to a neighborhood like Dudley Square in Roxbury, or to cities like Lowell or Holyoke? The densities are different, the economics of building revenues are different, but the end game is the same. They’re trying to build locally focused, interesting places.

baerkahn: In some ways, the economics are an advantage. Landowners’ costs are lower, so they could potentially take more risk. The dirt just doesn’t cost as much. The buildings don’t cost as much.

cw: If you look at downtown Lowell, downtown Haverhill, in terms of the physical proximity, the scale of the residential development, the importance of the street and the sidewalk, they’re built like a lot of neighborhoods in Boston. Is there any reason someone up there couldn’t do what you do?

baerkahn: The challenge would be having examples showing it can work. It’s not going to be exactly like Kendall, but you can do it. If you go to Chicago, it is super spread-out, and there are some really, really interesting retail in places that have very little vertical density. They’re often connected to public transit, and they often start with these little clusters of retail goodness that get bigger and bigger. Restaurateurs fundamentally want to be around other restaurateurs. It’s not a unique urban phenomenon. In an area like Dudley, it’s almost harder when you’re in a city and you’re so close to an urban core that’s sucking all the money and power away from areas that are close. It takes a unique entrepreneur. You see it happening on 125th Street in Harlem. You’re getting some really interesting, unique retail, mixed in with retail that has been there forever. In Dudley, it’s just about trying to bring more amenities to the neighborhood, to keep people in that neighborhood, keep dollars in that neighborhood. That dollar spent in a local business goes so much further than a dollar spent in a Subway [restaurant] or whatever it is.

cw: You’ve also seen strong retail not only retain the residential presence, but give it forward momentum.

baerkahn: Look at some of these areas in Brooklyn. Ask people why they’re moving to neighborhoods that, 10 years ago, may not have had any residential population, literally vacant warehouse neighborhoods. They’re going for two reasons. One, because there are interesting things there, typically restaurants. And two, because there are other interesting people there. These neighborhoods are happening. Instead of going into neighborhoods and bringing new people into neighborhoods that already have a different kind of residential density, I’m more interested in going into neighborhoods that have no density and figuring out how do you create value in a neighborhood that doesn’t have any? We’re going to have to create new neighborhoods as people come into the urban core. The better approach is redeveloping land that’s not being used for anything, as opposed to pushing people out, which we see happen a lot. That’s a tough balance. But in Kendall, there wasn’t much, and that’s what’s interesting about the Seaport.

Meet the Author

Paul McMorrow

Associate Editor, CommonWealth

About Paul McMorrow

Paul McMorrow comes to CommonWealth from Banker & Tradesman, where he covered commercial real estate and development. He previously worked as a contributing editor to Boston magazine, where he covered local politics in print and online. He got his start at the Weekly Dig, where he worked as a staff writer, and later news and features editor. Paul writes a frequent column about real estate for the Boston Globe’s Op-Ed page, and is a regular contributor to BeerAdvocate magazine. His work has been recognized by the City and Regional Magazine Association, the New England Press Association, and the Association of Alternative Newsweeklies. He is a Boston University graduate and a lifelong New Englander.

About Paul McMorrow

Paul McMorrow comes to CommonWealth from Banker & Tradesman, where he covered commercial real estate and development. He previously worked as a contributing editor to Boston magazine, where he covered local politics in print and online. He got his start at the Weekly Dig, where he worked as a staff writer, and later news and features editor. Paul writes a frequent column about real estate for the Boston Globe’s Op-Ed page, and is a regular contributor to BeerAdvocate magazine. His work has been recognized by the City and Regional Magazine Association, the New England Press Association, and the Association of Alternative Newsweeklies. He is a Boston University graduate and a lifelong New Englander.

cw: A lot of the development that’s happening in places like Lowell, Lawrence, Haverhill, it’s repurposing empty factories.

baerkahn: Our generation may be more inclined, if there’s interesting retail and amenities, to go live in a place like Lowell than to live in a place like Burlington. They’re not that far apart. Would you rather live in Andover or Lowell? I don’t think Lowell is that far from being able to draw some of the folks currently living in the urban core, when they eventually want to get out of downtown Boston or Cambridge, but they still want to be in a dynamic mixed-use neighborhood. Do they stay in the city? Or do they go to, not suburban, but sub-urban? Lowell will never have the density of Boston, but it could be a really interesting mixed-use place that Burlington or Andover won’t be.