Sag Harbor eyes limits on chain stores amid debate over retail identity

As big-name retailers continue to shape business districts in the Hamptons, Sag Harbor is considering restrictions to protect its historic Main Street from an expanding presence of chain stores.

A proposal presented to village trustees would ban new so-called "formula" businesses from opening along both sides of Main Street and portions of certain side streets, and require them to secure a special permit to open elsewhere in the village.

The recommendations, developed by planning consultants Inter-Science Research Associates after discussions with residents, businesses and village officials, were presented during a special village board meeting recently.

"You could always ease up on it later, but if the village fills up the formula stores and the village starts closing down in the way you see in the other communities, you're going to have a hard time dealing with it," Inter-Science president Richard Warren told the village's board of trustees.

Inter-Science’s report was prompted by concerns that larger retailers moving into the village could drive up commercial rents, displace independent businesses, leave storefronts vacant during the offseason and erode its historic character. Chains that have opened recently in the village include the clothing stores Steve Madden, Rag & Bone and Madewell. 

Warren proposed defining formula businesses as those operating 10 or more locations and sharing characteristics of standardized branding or operations, such as similar names, logos and signage. The 10-location threshold, he said, would target larger chains without discouraging local businesses from expanding.

Certain "essential services," such as banks, medical offices and pharmacies, would be exempt from the ban but remain subject to other zoning requirements, Warren said at the Oct. 29 meeting.

If the recommendations are adopted, there are 10 businesses in the village that meet the criteria, Warren said.

More than half of those businesses opened in the last two years, according to Inter-Science's report. There is no evidence that those businesses have harmed Sag Harbor, he said, but he added they could become detrimental if the number grew.

"It's probably better to get your arms around it now while you have a relatively limited number," Warren said. Stores currently open in the village would be exempted from the proposal.

Village trustees said during a work session Tuesday that they would consider legislation to implement the recommendations.

"I think that our goal is to keep the small-village feel with the shops that we have and to promote small businesses to come into the village," Mayor Thomas Gardella said.

Bob Weinstein, co-director of Save Sag Harbor, a civic group that launched an online petition to "help stop Main Street from becoming Chain Street," said Warren’s recommendations are "a step in the right direction."

"I think it's important, obviously, that we try to maintain the character of the village as much as possible," Weinstein said in an interview.

Lisa Field, owner of the Sag Harbor Variety Store on Main Street, said the measures go too far.

"As a small-business owner who owns the property, I am adamantly against any further laws, rules or regulations whose goal is to limit my rights as a commercial property owner by dictating who I am allowed to rent or sell my retail space to," Field said in an interview.

Marilyn Holstein, president of the Sag Harbor Chamber of Commerce, said she supports the effort to regulate formula stores but did not take a position on the village's proposal.

"It's got just a very charming, historic feel to downtown," Holstein said in an interview. "It's an experience that we don't want altered when some of these formula stores are trying to come into town."

For members of the Sag Harbor community who spoke at the board's Oct. 29 meeting, the issue was not simply the number of chain stores but the economic advantages that allow them to compete with small businesses.

Keith Green, whose family operated a store in East Hampton, said during the meeting that large retailers could afford to occupy desirable storefronts even if those locations generated little direct profit. Those stores, he said, could serve as promotional gateways for online businesses.

"If we don't find ways to stop it, it's going to crush us," Green said.