Issue:  Vol. 48 / No. 11 / 15 March 2018

Philz Coffee brews up plans for larger Castro store

Courtesy Philz

Courtesy Philz

The recent caffeinization of the Castro district shows no signs of reaching the bottom of the pot, with homegrown Philz Coffee the latest to brew up plans for a new location in the city’s gayborhood.

Founded in the city’s Mission District in 2003 by Phil Jaber, the company opened its second outlet a year later in the Castro at 4023 18th Street. The 400 square foot location, however, is cramped and shares the space with a laundromat.

With its lease set to expire, Philz would like to relocate to a larger storefront at 549 Castro Street. Formerly the site of a locally-owned shoe store, the space currently houses Supervisor David Chiu’s campaign headquarters for his Assembly bid.

By doing so Philz would be able to expand the number of stations to slow drip its made-to-order coffees in the new Castro location, allowing for faster service on the weekends, when it is particularly busy. And it could liven up that block of Castro Street, which has struggled for more than a decade to draw foot traffic due to the longtime closure of the Patio restaurant and intermittent usage of the next door storefront.

“It is a slightly larger store so we could serve the community better,” Tracy Chiao, vice president of real estate for Philz, told Castro business owners Thursday morning at their monthly meeting.

The company is just beginning to meet with neighborhood groups to discuss its relocation plans as it applied for the necessary permits with the city’s planning department in August. Because Philz now has 15 stores in the Bay Area and one in Los Angeles it is considered a formula retailer and needs to win approval to open the new Castro store from the planning commission.

It has yet to be given a hearing date. Should it win the needed permits, company officials expect to have the new Castro Street location open sometime next year in the late spring or early summer.

“It is a really exciting time and a good move if it happens with the expanded sidewalks,” said David Grey, a project manager for new store development at Philz. “It is still going to be the smallest Philz but will be twice as big as the 18th Street Philz.”

It remains to be seen if the neighborhood will welcome Philz on that segment of Castro Street. Plans to open another formula retailer, Hamburger Mary’s, in the old Patio space have drawn objections. That project is waiting to be heard by the planning commission.

In addition to arguments over it being a chain store, as defined by the city, Philz could also face opposition from those who object to seeing another coffee house move into the Castro.

Over the last year the neighborhood has welcomed such entrants in the java business as Eureka! Cafe (451 Castro Street), Espressamente Illy (2349 Market Street), and Reveille Coffee Company (4076 18th Street).

They joined long established Castro coffee houses Spike’s Coffees and Teas (4117 19th Street); Peet’s (2257 Market Street); Starbucks (4094 18th Street); and the Castro Coffee Company (427 Castro Street).

Work is underway on the Weaver’s Coffee & Tea coming to a ground-floor space in same building as Fitness SF at the corner of Market, Noe and 16th Streets. And in April Hearth Coffee Roasters won approval to move into 3985 17th Street, the site of a former tanning salon.

Should Philz’s application for the Castro space be rejected, it is unclear what the company will do.

“It’s possible we would leave the Castro; that store is definitely compromised for us,” Grey said of the 18th Street space. “But we may talk to our current landlord about extending the lease.”

— Matthew S. Bajko, September 5, 2014 @ 11:14 am PST
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