Moving Out: Small Businesses Feel the Real Estate Crunch

Kitsilano, the West End, and Mount Pleasant have always been known for their eclectic mix of shopping and restaurants. With a focus on growing small businesses, these key corners of the city are what give YVR its character and contribute to our local economy. And while many entrepreneurs have been attracted by the affordable rents and high-traffic corners, these blocks that are commonly made up of mom and pop shops may soon become a thing of the past.

Why? Because of redevelopment. Many of the older stores are being torn down and restructured for more modern spaces or mixed-use buildings. As a result, the once affordable rents will be far out of reach. In addition, it could take years for the project to be completed, which means owners would be forced to temporarily shut down while construction took place. As a result, many smaller operators seeking to relocate. The only problem is, where?

Many are going east. Main Street is still reasonable for smaller businesses, ranging from $40 to $60 per square foot. As for Kitsilano, Jane McFadden, the executive director of the Kitsilano 4th Avenue Business Association, shared in The Vancouver Sun that while their motto is “Shop local, shop West 4th”, many in the 2300-block are getting pushed out.

Photo: Shop West 4th

For years, Robson Street has been Vancouver’s most sought-after location for retail. Fashion-focused with high-traffic, it demands an average of $200 per square foot. Independent stores simply can’t compete with those rates, which are why these popular blocks are filled with chains like Forever 21, Zara, Banana Republic, and Aritzia.

Photo: Robson Street

And while many may blame redevelopment, new construction has also provided opportunity. Many developers are introducing mixed-use buildings, which offer direct traffic from the residents who share the building. The City of Vancouver has also placed restrictions on the size of retail to encourage an active streetscape in an effort to prevent large box stores from overtaking smaller retailers.

According to a study by LOCO BC, small businesses are incredibly important for the BC economy. When residents shop local, 33% of the revenue directly recirculates into the province, compared to 17% for multinational counterparts. This represents a 77%-100% economic advantage. In addition, every one-percent increase in local shopping translates into more than 3,000 new jobs and $94 million in wages.

Do you think independent retailers will continue to be pushed out, or do you see an opportunity for growth as Vancouver becomes more densely populated? Tweet @naiopvancouver and let us know!

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