Sausalito softens stance on ‘formula retail’

Sausalito will soon allow large chain stores in the Marinship area and invite more boutique businesses into its other commercial zones.

The “formula retail” ordinance update, which the City Council unanimously approved on first reading on Feb. 17, still bans drive-thru food businesses.

“It’s a very modest step,” said Councilmember Ian Sobieski. “All these big fast food chains are prohibited.”

“We’ve always viewed formula retail in Sausalito cautiously,” said Councilmember Jill Hoffman. “It may not seem like an aggressive step forward, but I think for Sausalito, it’s an aggressive step and I’m cautiously optimistic.”

City officials have been wrestling with the formula retail rules since 2024. The prior code did not precisely define what constituted a formula retail business.

In 2017, a court overturned a successful Malibu ballot measure that banned certain businesses. Sausalito, like many Marin municipalities, has ongoing struggles filling downtown storefronts.

In late 2024, the Planning Commission developed a code update that defined formula retail as a business with six or more locations worldwide. When that came before the City Council last spring, the members felt the definition was too restrictive. The council created a study group led by Sobieski and Hoffman, and a more nuanced definition and application emerged.

“If you have 50 or more locations in California, you will qualify as formula retail, and you will be allowed in the shopping center district,” said city planner Matthew Mandich. “By right, if you have 50 or below, you will not qualify as formula retail, and you’ll be able to locate in the city’s commercial zones accordingly.”

“Depending on the use type, you may still need a discretionary permit of some kind,” he said. “But you will be able to locate in the commercial zones without any additional formula retail zoning clearance or anything of that nature.”

Certain business uses are exempt, Mandich said, such as grocery stores, pharmacies, banks, medical and real estate offices, service stations, movie theaters and couriers.

He said specialty chains with fewer than 50 California locations include Blue Bottle Coffee, Anthropologie, Tacolicious, Marine Layer, Faherty, Hudson Grace, Alo, Equinox, Gott’s, Louis Vuitton and Boichik Bagels.

The code revisions were mostly praised during public comment.

“The thing that businesses need in town is certainty and clarity of process and ease of process,” said Carlo Berg, who owns Marinship properties. “For too long, formula retail and the ordinance in general has been something that people have twisted themselves into contortions to get around.”

“I wish this was a magic bullet that we could point at our vacancies,” said Adrian Brinton. “It’s one big step along the way and it’s one piece of the puzzle.”

“If I was to expand into a storefront, the cost of renting downtown is astronomical and not friendly to local businesses here,” said Justine Kahn, founder of Botnia, a cosmetics maker in the Marinship area. “It does scare me a little bit to have formula retail take over certain areas of town, especially near Mollie Stone’s, where we have a delicate ecosystem of light manufacturing.”

“The local businesses that are organically grown from the inside out in the southern Marin community, in Sausalito in particular, I don’t know how they’re going to stand up to competition that’s been tested on the national level,” said Babette McDougal.

Members of the City Council praised the proposal and the effort to customize the ordinance.

“The biggest chain, the biggest franchise in Sausalito, is called vacant storefront,” Sobieski said.

“Removing a barrier to potential businesses is an important step in the right direction,” said Councilmember Joan Cox.

“Now we can finally embrace those businesses, like Rustic Bakery, for instance, when they approach us about the opportunity to be in our downtown,” said Vice Mayor Melissa Blaustein.