Despite taking a battering during the height of the COVID-19 pandemic, Vancouver retail vacancies are at extreme lows, according to a new report from Colliers International.
The report, which compares different neighbourhoods across Vancouver in terms of retail vacancies, reports the lowest retail vacancies are in Kerrisdale at 0 per cent, Davie Village at 0.89 per cent, Cambie Village at 1.04 per cent and Yaletown at 1.3 per cent.
The average city-wide retail vacancy rate is just 2.5 per cent — considered extremely low by Colliers.
The report indicates that areas near the Central Business District tend to have the highest retail vacancy rates. Colliers attributes the vacancies to a lack of business conferences due to the COVID-19 pandemic and a slow and inconsistent return to the office for many workers.
Conversely, areas outside of the CBD such as Kitsilano, South Granville and Mount Pleasant fared well, seeing rents increase and vacancies decline – a direct result of people working from home in the dense surrounding residential areas.
The 1000-block of Robson Street, home to retailers like Zara, Foot Locker and Herschel, remains in high demand with a 2.2 per cent vacancy rate and median net rents estimated between $180 – $240 PSF/per annum.
One block west, the 1100-block of Robson (London Drugs, Muji, Nike) is transitioning from mid-market fashion retailers to other types of retail, including discount and speciality retailers. It also has a much higher vacancy rate of nine per cent and median net rents approximately 50 per cent less than the 1000-block of Robson.
The 1000-block of Alberni, considered downtown Vancouver’s luxury shopping street, has no vacancies at all, and Colliers predicts this will encourage high-end retailers to move further west to the 1100-block where Tudor and Chopard recently opened locations.
Several new developments containing substantial square footage of retail space are currently under construction across Vancouver, including:
- The Post (QuadReal), 185,000 square feet, completion 2023
- 375 East 1st Avenue (Onni), 43,000 square feet, completion 2024
- Oakridge (QuadReal and Westbank), 1,000,000 square feet, completion 2024
- River District phases one through six (Wesgroup), 157,260 square feet, completion 2023.
According to The Conference Board of Canada, 2021 retail sales in Vancouver were 14 per cent above 2019 levels, recording $45.7 billion in sales, versus $40.0 billion in 2019.
Colliers expects to see more mixed-use projects developed on the expensive, scarce sites available in Vancouver, and for vacancy rates to continue near historic lows.