Buy Alexandria Real Estate: The Starbucks Effect -- My Data Says It's Real!

Alexandria Virginia Real Estate Blog

The Starbucks Effect -- My Data Says It's Real!

Coffee CupsConsider it a chicken and the egg question. You know, which came first?

What's the Starbucks Effect?

It's the idea that super-cool Frappuccino joints increase the value of homes in the neighborhoods where they decide to locate their coaches, cappuccinno makers, and coffee bean grinders. Do these caffeine peddling haunts increase property values or do they just open up in communities where the more expensive homes already exist -- thus taking advantage of a customer base that can presumably afford the Vente Iced Skim Mocha No Whip?

I decided to find out by taking a look at some of the facts and statistics here in Northern Virginia.

First, I watched the following video about Arlington, Virginia which has been making the rounds towards the end of last week. If you live in the area and haven't seen it yet, it means you haven't been on the internet in about a week. If you are outside Northern Virginia, you may miss some of the inside jokes but understand that this spoof hits it on the head about the culture of Arlington (or at least North Arlington). Make sure you watch this through the end...



So, inspired by this recent video, I decided to examine whether the Starbucks Effect existed in Arlington and Alexandria by reviewing the hard data about housing prices. It was only after completing this research that I discovered that the The Starbucks Effect is a well-documented phenomena. Follow along.

Arlington Virginia boasts 12 Starbucks stores -- 3 in zip code 22201, 3 in zip code 22209, 4 in zip code 22203, and 2 in zip code 22207. The areas located in Arlington zip codes 22202, 22204, 22205, 222206, and 22213 have no Starbucks stores, in other words, they are Starbuck-less.

Let's examine the average listing price of homes in the various Arlington locales:

Arlington Areas with Starbucks:

Zip Code       # of homes available       Average Price

22201                     129                       $696,923

22203                       54                       $519,798

22207                     143                     $1,197,137

22209                       87                        $945,433

TOTAL                         443                                 $856,981

Arlington Areas without Starbucks:

Zip Code        # of homes available     Average Price

22202                    76                          $727,312

22204                   144                         $423,608

22205                    39                          $906,418

22206                    40                          $392,451

22213                    10                          $871,315

TOTAL                     309                                   $569,698

Wow! The average listing price for a home in a Starbuck-less neighborhood is nearly $300,000 less than those in the high-caffeine areas of Arlington. Note to Starbucks management: You may want to consider opening up a branch in the 22205 zip code of Arlington!

Thinking this might just be an anomaly, I took a peek at the data for neighboring Alexandria. 11 Starbucks stores grace the streets of Alexandria Virginia. Not surprisingly, 9 of these are in zip code 22314, the Old Town Alexandria area of town which gets the most tourist traffic, and yes, the most expensive homes are located. The other 2 stores are located in zip codes 22301 and 22302. There are no Starbucks stores in zip codes 22304 or 22305.

Let's take a similar look at the data for Alexandria:

Alexandria Areas with Starbucks:

Zip Code        # of homes available      Average Price

22301                     37                          $778,912

22302                     46                          $434,531

22314                    240                         $923,212

TOTAL                      323                                   $837,087

Alexandria Areas without Starbucks:

Zip Code      # of homes available       Average Price

22304                 166                          $420,382

22305                   42                          $598,279

TOTAL                     208                                 $456,304

Once again, the numbers show that on average your purchase of a home in an Alexandria area served by Starbucks will cost you an additional $300,000+.

Starbucks Effect? Yes or No. You decide. I'm going to have my morning coffee tea.

One final note: It's no surprise to me that a two story Starbucks, and one of the busiest branches on the East Coast is located right next to my office in McLean Virginia -- zip code 22101. The average listing price of a home in that zip code is $1,657,101. McLean was recently named the most affluent community in America.

Maybe, just maybe, it was The Starbucks Effect!



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Comment balloon 12 commentsBrian Block • June 15 2009 07:12AM


Interesting comparison of the "Five"bucks effect or as I like to call it Star-suks!

Posted by Gary L. Waters, Broker Owner, Waters Realty of Brevard, LLC, ... a small office, delivering big service! (Waters Realty of Brevard, LLC) about 9 years ago

I like the blog and the video . Great stuff and a really good laugh this morning. I have been to starbucks twice and that was 3 times to many

Posted by Charlie Ragonesi, Homes - Big Canoe, Jasper, North Georgia Pros ( about 9 years ago

Brian:  Just for you... I listened... actually, I "endured" that whole, entire video.  My poor elderly ears just are not into that "rap" sound... or is it (c)rap sound ?  But... to answer your question, I think the neighborhood values came first, and then the Starbucks... although what do I know?  Poor Starbucks.  They have over-populated and over-placed their stores, and are now phasing down in many, many areas.

It's been years since I've been to NoVa... except for a four-day trip in 2007 for a seminar in Reston.  I would love to come back and just enjoy.  Maybe this summer or fall.  Thanks for sharing... take care...

Posted by Karen Anne Stone, Fort Worth Real Estate (New Home Hunters of Fort Worth and Tarrant County) about 9 years ago

Brian, interesting statistics. I'm sure Starbucks takes into consideration the demographics before selecting a site. I found this interesting statistic for a Starbucks location in Northern Virginia:

Demographics include a trade-area population of 101,116 earning $99,067 as the average household income.

I think your analysis is probably on target.

Posted by Michael Setunsky, Your Commercial Real Estate Link to Northern VA about 9 years ago

Brian - great stats!  Do you think the same holds true for neighborhoods with a Trader Joe's?  (loved the video!)

Patty Keller, AnotherME

Posted by Patty Keller, AnotherMe - 770-414-9393 - RE Virtual Assistant (AnotherME, LLC) about 9 years ago

Hi Brian ~ OMG!! I laughed till I cried.  That video is genius.  I thought it was a super talented realtor until I clicked on the website.  I'm about to email it to half a dozen people.

A few years ago Boston magazine ran an article about the extensive research that Starbucks does before it opens a store.  Having a Starbucks move in is a "stamp of appoval" of sorts -if the neighborhood hasn't already "arrived" it's supposedly on its way.

I'm a Dunkin Donuts fan myself and for years chose apartments by proximity to DD. Have to say that when a Whole Foods opened at the end of my street (next door to the Starbucks!) I was psyched.  Not that I'm into big chains but reality is it will end up in the real estate copy - down the street from...


Posted by Elizabeth Bolton, Cambridge MA Realtor (RE/MAX Destiny Real Estate Cambridge, MA) about 9 years ago

That video could be able many areas in Oregon too.  We love our coffee houses here too.  In fact we have three Starbucks all withiin 1/2 mile of each other...I guess it's too hard for consumers to go farther than that?

I like the part about the dudes wearing brown flip flops...that was funny.

Posted by Melina Tomson, Principal Broker/Owner, M.S. (Tomson Burnham, llc Licensed in the State of Oregon) about 9 years ago

I think part of the reason for this is the fact that Starbucks does a lot of research in to an area before they decide to put one in. They will not put a Starbucks were the income won't support someone buying one everyday. So, you will see them in nicer areas of town and as the income increases so will the type and quality of stores.

Todd Clark -

Posted by Respect Realty LLC, Brokers - Oregon / SW Washington Real Estate (Respect Realty LLC) about 9 years ago

Hi Brian...Maybe I should open up a Starbucks here at Lake Anna. 


Posted by Kate Elim, Realtor 540-226-1964, Selling Homes & Land a (Dockside Realty) about 9 years ago

Turn around.  The Starbucks don't enhance the neighborhoods.  Starbucks demographic research locates their shops where the money is. 

I sold a luxury town home in McLean because my buyers wanted to be walking distance of a Starbucks. 

Posted by Lenn Harley, Real Estate Broker - Virginia & Maryland (Lenn Harley,, MD & VA Homes and Real Estate) about 9 years ago

I think you need to call the Data Geeks at Altos and get a nationwide statistical analysis going.  You are onto something here.

BTW, that music is awful.


Posted by Kristal Kraft, Selling Metro Denver Real Estate - 303-589-2022 (The Berkshire Group Realtors) about 9 years ago

There is a Strabucks in 22205 located in the Lee Harrison Shopping center.


One of their busiest stores.

Posted by Paula Atkins almost 9 years ago