Editorial: City needs to step in on APE mess

Another Planet Entertainment’s renovation of the Castro Theatre is moving along, but there’s a hiccup over the fate of two small businesses in the same building that flank the theater. Mayor Daniel Lurie’s office needs to stay directly involved, with the goal of keeping the business sites activated during the daytime.

Reportedly, Lurie has asked for 60 days for good faith negotiations in the matter. The Castro Coffee Co. and Castro Nail Salon, owned by the Khoury brothers, have been in a lease dispute for several months, ever since it was revealed that APE wants to utilize those storefronts for the theater – though the company insists the matter is between the Khourys and the Nasser family, which owns the building containing the siblings’ stores and the theater. During all of the hearings and meetings two years ago over the fate of the theater, particularly the orchestra seating, APE didn’t mention that it ultimately wanted to take over the sites housing the coffee shop and nail salon. Even when we started reporting on the lease dispute earlier this year, APE denied that.

Back in March APE spokesperson David Perry, a gay man, disavowed what he phrased as a “rumor” that APE wanted to acquire the spaces. “We’re not going to comment on a hypothetical,” he stated. “At the moment we’re focused on getting the theater open for the community.”

To the surprise of no one, that wasn’t true. In May, the San Francisco Chronicle reported that APE said that it needed those two spaces for its expanded box office. Given the June 30 date of the lease terminations at the coffee shop and nail salon, APE waited until the last minute to fess up. (The two businesses continue to remain open, though for how long is uncertain.)

APE’s behavior is in keeping with its whole attitude toward the Castro neighborhood since the company took over management of the theater in early 2022. It’s APE’s way, or the highway. We wrote in this space back in April 2023 that APE was not being a good neighbor. It balked at negotiating with the Castro Conservancy, a group that favored keeping the orchestra seating, and no agreement was reached. Ultimately, the San Francisco Board of Supervisors rejected an amendment to keep the fixed orchestra seating, and APE was allowed to remove those in order to have flexible seating for live music events and movies. (The fixed balcony seating was deemed historic and remains.)

Now, APE is further exhibiting that it doesn’t really care about the Castro community with this latest standoff over the spaces occupied by the coffee shop and nail salon. One thing we can’t figure out is why the theater even needs an expanded box office. As someone commented via the Pilsner Inn’s social media last week, virtually all event tickets are sold online these days.

The Castro Nail Salon, at 431 Castro Street, is a legacy business, meaning city planning commission approval would be required before APE could change the space. The coffee shop is not in this category; however, it has been at the 427 Castro Street location for many years, under different names.

One of the reasons that Lurie’s administration must remain involved is because of the consequences of the small businesses leaving Castro Street. Lurie has been strident in his desire to see commercial corridors flourish as the city works to recover from the COVID pandemic’s economic flatlining. Losing the coffee shop and nail salon on the prominent 400 block of Castro Street would be devastating. “These are beloved businesses and active street-facing uses that help activate that block every day,” gay San Francisco Board of Supervisors President Rafael Mandelman told us in March.

This is doubly true now that the Pink Swallow bar and restaurant that had been planned for the old Harvey’s bar space down the street was shelved, as we reported online. Located at the iconic intersection of 18th and Castro streets, Harvey’s suddenly closed in January 2023, creating a massive dead space in the heart of the LGBTQ neighborhood.

We think APE should figure out some other way to have its box office – if that’s the real reason they want the spaces. We’re doubtful of anything APE says these days. The company should be working harder to be a good neighbor, not finding new ways to antagonize residents and merchants. It would be terrific if APE could readjust its plans and allow the coffee shop and nail salon to remain in business at their current locations. We’re hopeful that Lurie’s administration understands that.

After all of the work that has gone into making the Castro vibrant – approval of an entertainment zone for certain outdoor events, a regular night market, and openings of some new businesses like Rikki’s women’s sports bar on Market Street, the reopening next year of the Castro Theatre was supposed to be the crowning achievement. It won’t be if it comes at the expense of two active storefronts.