Troubling trend as more of Vancouver’s retail spaces sit empty

The vacancies are not focused in one specific area of ​​the city, but rather cut across various socio-economic neighborhoods

Content item

Commercial retail vacancies in half of Vancouver’s 22 business improvement areas are higher than what is considered healthy, a troubling trend akin to the widespread unaffordability seen in the housing market.

Advertisement 2

Content item

The vacancies are not focused in one specific area of ​​the city, but rather cut across various socio-economic neighborhoods, although some more densely populated areas with lower rents are faring better.

“It’s the two sides of Vancouver with this really high percentage of commercial retail storefront vacancies,” said Andy Yan, director of The City Program at Simon Fraser University. “You have (inner city and West Side) neighborhoods with the lowest and highest household incomes.”

Areas of the city that have vacancies rates over 15 per cent include Strathcona at 27 per cent, Hastings Crossing at 22 per cent, Point Gray Village and Dunbar Village at 17 per cent, and Chinatown at 16 per cent.

These were followed by South Granville and Mount Pleasant at 14 per cent, Marpole at 13 per cent, Robson Street at 12 per cent, and Gastown and Kitsilano-Fourth Avenue at 11 per cent.

Advertisement 3

Content item

“Just like there’s been an affordability crisis in residential housing, we’re seeing a similar issue in commercial real estate, and I think it’s something that’s maybe overlooked. I think that’s why you’re seeing these rates potentially across the city and not just confined to one neighbourhood,” said Steve Johnston, executive director of Community Impact Real Estate, which manages a portfolio of market and non-market commercial units with the goal of providing affordable space to non-profits, social enterprises and community-oriented businesses.

Empty stores in Point Gray as an Andy Yan study on commercial storefront vacancies in the city of Vancouver by BIA (for 2021) reports a 17% vacancy rate in that area in Vancouver, BC., on April 4, 2022.
Empty stores in Point Gray as an Andy Yan study on commercial storefront vacancies in the city of Vancouver by BIA (for 2021) reports a 17% vacancy rate in that area in Vancouver, BC., on April 4, 2022. Photo by NICK PROCAYLO /PNG

Areas in the city with lower percentages of storefront vacancies include Fraser Street and Kerrisdale at five per cent, Victoria Drive, Cambie Village and Yaletown at six per cent, and West Broadway, Commercial Drive and Downtown at seven per cent.

Advertisement 4

Content item

Across all these districts, an average of 11 per cent of commercial-retail units or storefronts were counted as empty, based on visual inspection, business license data and online research, according to a 2021 inventory conducted by the city. A range between four and 10 per cent, fluctuating due to renovations and turnover, is considered balanced.

Strathcona covers a large area, representing more than 435 business owners, said Business Improvement Association executive-director Vincent Kwan. Some of the areas with lower vacancy rates have half the number of business owners.

Kwan points out that in the months since the snapshot was taken in 2021, a new cluster of businesses has moved into spaces around the 800-block of East Hastings.

Advertisement 5

Content item

Flourist Bakery co-founders Shira McDermott and Janna Bishop set up shop in the 800-block of East Hastings.
Flourist Bakery co-founders Shira McDermott and Janna Bishop set up shop in the 800-block of East Hastings. Photo by NICK PROCAYLO /PNG

Shira McDermott, a co-founder of Flourist Bakery, which sells milled flour and dry goods and has had a street-front location on Commercial Street since 2019, is one of them.

“The collection of businesses was definitely part of the draw, and it’s nice to see areas like this kind of come to life,” said McDermott. “Things can change pretty quickly.”

Sunset on Fraser Business Association executive-director Rob Nijjar said it is in a sweet spot with steady, consistent foot traffic from being close to a densely populated residential area and leasing rates that are less than in other West Side neighborhoods with higher vacancies such as Point Gray and South Granville.

“Nowhere in Vancouver is cheap, but it is cheaper (here),” he said. “We’re talking $42 a square foot, so you (still) really have to have the sales to survive.”

Advertisement 6

Content item

Johnston, who is also on the board of the Hastings Cross Business Improvement Association, said the city relaxed guidelines in 2020 in order to fill vacancies, but then the pandemic started.

Many cities across North America are facing higher-than-ever levels of vacancies for storefronts since the COVID outbreak, and some academics are researching how to encourage tenants, as well as measures to motivate landlords such as vacancy taxes.

In Vancouver, between 2012 and 2019, ownership of properties by developers and numbered companies increased by 71 per cent and 45 per cent as owner-occupied businesses decreased by 25 per cent and six per cent, according to the city’s summary of its retail inventory in 2021.

Advertisement 7

Content item

The potential for redevelopment can increase rental rates and lead to shorter, more unstable terms that can be punishing for small business.

Understanding all these factors and figuring out which are systemic barriers and obstacles is key, said Yan. With the upcoming civic election, it’s important to know “which party is going to help fill up these vacancies?”

jlee-young@postmedia.com


More news, fewer ads, faster load time: Get unlimited, ad-lite access to The Vancouver Sun, The Province, National Post and 13 other Canadian news sites for just $14/month or $140/year. Subscribe now through The Vancouver Sun or The Province.

Advertisement 1

Comments

Postmedia is committed to maintaining a lively but civil forum for discussion and encourages all readers to share their views on our articles. Comments may take up to an hour for moderation before appearing on the site. We ask you to keep your comments relevant and respectful. We have enabled email notifications—you will now receive an email if you receive a reply to your comment, there is an update to a comment thread you follow or if a user you follow comments. Visit our Community Guidelines for more information and details on how to adjust your email settings.

Leave a Reply