Office and retail recovery? Downtown Vancouver mobile data use at 47% of pre-pandemic levels

Apr 18 2023, 11:58 pm

With the pandemic now in the rearview, commercial real estate analysts are increasingly tracking the recovery of city centres, particularly with the performance of office and retail spaces.

The most common metrics used so far are leased office vacancy rates, storefront vacancy rates, pedestrian foot traffic, public transit ridership, and retail spending. Mobile phone data also provides another picture of possible foot traffic performance in terms of both the number of workers and visitors.

Based on the University of Toronto’s School of Cities’ analysis, in Fall 2022, downtown Vancouver reached 47% of its pre-pandemic 2019 mobile phone data use — ranking it at 54th across 62 downtown areas evaluated across Canada and the United States.

Vancouver’s downtown is tied with the downtowns of Kansas City and Philadelphia, which are just behind Winnipeg (48%) and ahead of Montreal (46%), Seattle (44%), and Calgary (43%).

This provides new context to leased office space vacancy rates. While downtown Vancouver continues to have some of the lowest leased office vacancy rates amongst city centres in North America, and certainly in Canada, such rates represent real estate status, and not actual use when the impacts of semi-remote office work are accounted for.

For the first quarter of 2023, commercial real estate firms CBRE and Avison Young have calculated leased office space vacancy rates of over 10% in downtown Vancouver — up from under 2% in early 2020 before the pandemic.

Amongst Canada’s city centres, London, Ontario ranked the highest in the list, with a 13th overall ranking for its 79% mobile phone data recovery. This is followed by Halifax at 65% (28th), Toronto at 53% (41st), Edmonton at 52% (42nd), Quebec City at 51% (44th), and Ottawa also at 51% (44th tied).

The best-performing downtown for mobile phone data recovery is Salt Lake City at 135%, while the worst is San Francisco at 31%.v New York City’s recovery is 74%, giving it a ranking of 18th.

Generally, the downtowns that have bounced back the most are within the southern United States, and the downtowns that continue to struggle are mainly in the northern areas of the continent. Downtown areas within medium-sized cities have also generally recovered more quickly than downtowns within larger-sized regions.

According to Downtown Van’s (the local business improvement association for downtown Vancouver’s Central Business District) newly released annual State of Downtown Vancouver report, about two third of office-based companies have adopted or plan to adopt a formal semi-remote office work model, with only 33% expecting employees to return to the office full-time.

As well, downtown Vancouver’s average monthly recovery for office foot traffic in 2022 was 62.1% below pre-pandemic January 2020. This is an improvement from a recovery of 54% in 2021.

But downtown Vancouver’s average monthly office foot traffic recovery outpaced the downtowns of Toronto, Edmonton, Calgary, and Ottawa in 2022. Downtown Vancouver’s office foot traffic recovery peaked at 76% in May 2022, but a downward trend began in the second half of 2022.

As of February 2023, according to the BIA, the Central Business District’s storefront vacancy is at 13%.

According to the City of Vancouver’s 2022 count of storefront vacancy rates within the downtown Vancouver peninsula, the Central Business District (Downtown Van BIA area) has a vacancy rate of 12.5%, representing 102 vacant storefronts. This is lower than the 14.2% vacancy within Gastown BIA and 15.5% vacancy within Robson BIA but higher than 8.9% within the West End BIA (Davie and Denman streets and Upper Robson) and 8.4% within the Yaletown BIA.

Downtown Van BIA also reports travel and entertainment sales in the Central Business District saw a 46% monthly average year-over-year growth in the second half of 2022.

Hotel occupancy within the Central Business District went up from 40% in 2021 to 72% in 2022, representing a recovery of 90% of 2019’s occupancy levels, according to local tourism bureau Destination Vancouver.

TransLink’s public transit ridership statistics show downtown Vancouver recovered 75% of its pre-pandemic ridership in 2022, which is a 50% increase from 2021.

downtown mobile phone data recovery fall 2022

Fall 2022 mobile phone data recovery levels in Canada and US downtown areas compared to pre-pandemic 2019. Click on the image for an expanded graphic. (University of Toronto)

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