Sag Harbor, in an era of chain stores, wrestles with its retail identity

Sag Harbor has long traded on its reputation as a hub of independent business on the South Fork — a place where a five-and-dime, an art-house cinema and a family-owned hardware store thrive within a compact, historic, walkable village.

It's a place with a “unique collection” of American architectural styles that coexist, according to Bob Weinstein, co-president of the civic group Save Sag Harbor. On and around Main Street, shingled whalers’ cottages and stately Greek Revival homes sit steps from small boutiques and restaurants, reflecting a mix of styles that traces back to the village’s 18th century settlement. 

Now, that quaint identity is being tested as more chain, or “formula,” retailers arrive, fueling concerns that the former whaling village could follow other Hamptons destinations toward a concentration of luxury brands that push out year-round mom-and-pop shops.

As the village has become a destination itself, some worry that it's also become a victim of its own success, and in the process is losing what makes it special.

“Sag Harbor has become so popular that we risk losing the very individualized retail feeling that has developed over many, many years,” said Weinstein, whose group is leading a campaign to encourage village officials to regulate so-called formula stores.

Village officials are exploring legislative changes to keep Sag Harbor's unique character intact without hurting local business. But that's a delicate balance: Business leaders note that national branded stores can draw new people to the village and boost foot traffic. 

The goal is to avoid what trustee Ed Haye described as a “luxury monoculture” of high-end retail that dominates Southampton and East Hampton villages.

“It’s not about just looking for a quick fix or just to be anti-formula,” Haye said in an interview. “We have to be thoughtful about how that balance of national brands within the kind of independent local establishment works, and what regulatory tools are available to us to help maintain that balance.” 

Sag Harbor’s residents have a long history of fighting chain stores — sometimes successfully, sometimes not. But the recent arrival of recognizable brands — Steve Madden last summer, followed by Rag & Bone and Madewell this season — has reignited the debate. 

Earlier this year, Save Sag Harbor launched an online petition urging residents to “help stop Main Street from becoming Chain Street!” The petition, which has more than 1,400 signatures, calls on the village board of trustees to study legal tools available to define and limit formula retail in the historic business district, hold a public forum and consider new legislation.

Over the past decade and a half, both retail economics and Sag Harbor have changed, Weinstein said. With the growth of online shopping, retailers no longer need the same amount of physical space they once did, he said. At the same time, the village has become a “Hamptons” destination, and national brands now see value simply in being associated with the Sag Harbor name — even in small storefronts that might not match the profitability of larger locations, he said.

The village board has hired Southampton-based planning firm Inter-Science Research Associates to inventory businesses and study the impacts that new regulations could bring.

“The goal isn’t just anti-formula; it’s more about pro-diversity,” Haye said. The village, he added, is looking for a mix of businesses that can function year-round for residents, “rather than just a tourist-only district.”

A close look at what constitutes a chain

According to Inter-Science, other communities on Long Island and elsewhere have tried to regulate formula stores in several ways, including requiring special permits, limiting store size and frontage, and regulating other characteristics associated with them. The Village of Cold Spring, in the Hudson Valley, banned them altogether in 2014.

As for Sag Harbor, it imposed regulations recently that indirectly affect formula stores, officials noted. They include cutting the width of new storefronts to 25 feet from 50 feet and eliminating a provision that allows stores to expand by up to half their size.

Mayor Thomas Gardella said Inter-Science's recommendations directed at formula stores will come after the summer season draws to a close.

The village needs “to put some checks and balances in place so that the board and the community have some type of input when these applications come forward for these formula stores,” the mayor said.

One of the biggest hurdles may be defining what constitutes a “chain” in the first place.

The village has several businesses popular with residents that could fit a broader definition of a formula store because they have multiple locations, including Goldberg’s Bagels and Jack’s Stir Brew Coffee.

“It has to be done in a certain way, where the village won't get sued,” Gardella said.

Officials are also weighing the risks of overregulation, a growing concern of Sag Harbor businesses, Chamber of Commerce vice president Kevin Menard said.

Newer retailers can drive foot traffic, said Menard, whose store, Dragon Hemp Apothecary, is next to Madewell.

“They bring a new clientele to the village,” Menard said. “When they bring this new clientele, who might not be coming in the first place, they can walk around all the other stores.”

On a recent Thursday, Stephanie Anderson stepped out of that Madewell store, a recent purchase in hand. Anderson and her husband were visiting from Kingwood, Texas, on a trip for their 22nd wedding anniversary.

Anderson wasn’t expecting to see a Madewell in Sag Harbor, which she associated more with small, nonchain businesses. But it was welcome. She needed a warmer shirt to wear at dinner that night and wears the brand at home.

“I do like having something that’s familiar,” Anderson said. But then she added: “I will say, too many or too much of something is not always a good thing. Maybe keeping it small and not getting a lot more of these stores might be better for the area.”

Spokespeople for Madewell, as well as Steve Madden and Rag & Bone, didn't return requests for an interview.

Staying past summer?

Another concern among business owners is whether formula retailers will stay open beyond the summer season.

Like other seasonal destinations, Sag Harbor businesses see a boon this time of year from tourists and summer residents. But unlike neighboring villages, where some boutiques open for the busy season and close for the rest of the year, Sag Harbor remains relatively lively in the offseason, residents and village officials said.

Last year, Steve Madden in Sag Harbor closed after the summer and blacked out its window, drawing the ire of some residents and business owners. That led the village board to enact a law requiring storefronts to maintain their displays, even if they are closed for months at a time. 

Menard said formula retail stores should stay open year-round. “At the end of the day, we have to protect the business vitality,” he said.

Yet he warned that deep-pocketed chains and luxury brands could increase property values and rents, making it harder for locally rooted businesses to remain.

Simone Kessler, who manages the boutique clothing store Wild Side in the village, said the influx of new stores has made her concentrate on stocking high-end products other brands don’t carry.

Kessler, 25, who grew up in Sag Harbor, said the issue brings mixed emotions, as she's seen some of the beloved small businesses she grew up with shutter and be replaced with chain retailers. For example, Madewell moved into the storefront of Flying Point in the Harbor, a brand that began in the Hamptons.

“Sag Harbor was always supposed to be that town that stayed very family-business-oriented — small mom-and-pop shops,” she said. “But now it's turning more corporate, and we're just all scared that the prices are going to continue to go up, and that we're all going to get moved out at some point."

Ultimately, residents, business leaders and village officials agree, there's a need to protect what makes Sag Harbor distinct.

“I don't believe people are coming to Sag Harbor for Gucci, they know they can find that elsewhere,” Weinstein said. “I think they're coming for what, so far, is currently there, which is something very special. And if we don't hold on to that … we're at risk of losing it all.”