“From the departed HMV to the bankrupt Blockbuster, empty stores dot Vancouver’s highest profile commercial street. West of Burrard, more than 20 retail properties on Robson sit empty. And realtors have taken note.
“For years you’ve never seen lease signs up and down Robson,” said Sherman Scott, associate vice-president at Colliers International, which currently has a number of properties open.
“Now there certainly are, which is unusual.”
Tourism Vancouver President Rick Antonson characterized the vacancies as part of a “transition” but he is bullish on the street’s long-term vibrancy.
“Some international operators can anchor a street and draw traffic. What one always wishes to avoid is a generic street or city. [But] Robson street will get through this transition and retain its reputation as having a healthy variety of retail outlets.”
Following the 2010 Olympics, prices climbed to new heights on Robson. According to one real estate report, the average rent last year was $240 US per square foot, trailing only Bloor Street in Toronto for Canadian supremacy.
“Expectations are changing on Robson. The value of real estate has increased,” said Mark Renzoni, managing director of CB Richard Ellis.
He did, however, admit “the economy is not as strong as we’d like.”
“I think you’re going to see a lot more American retailers moving in,” speculated Howard Malachy of DTZ Barnicke, which specializes in commercial real estate.
“Robson is like Rodeo Drive, it’s like Park Avenue. People want to be there to be there.”
– from ‘More than 20 vacancy signs as Vancouver’s Robson Street undergoes ‘transition’ – Justin McElroy, The Province, 1 May 2012 [Image from Vancouver archives; hat-tip Nemesis]
We find the logic being used by the landlords bizarre and perverse.
They do not ask the question “What will the market bear?” but rather state, based on beliefs and not evidence: “Robson is like Rodeo Drive, it’s like Park Avenue”, and they then set accordingly unrealistically high rents. Unsurprisingly, their properties are sitting vacant.
Are there 20 stores sitting vacant on Rodeo Drive? Even in the midst of considerable economic hardship, no.
The logic is reminiscent of that heard in a recent CBC radio discussion about the closing of the Playhouse Theatre. The argument used by discussants was “Vancouver is a world-class city, it should have a very vibrant theatre scene”. No one asks “Vancouver does not have a spontaneously very vibrant theatre scene, is it really the ‘World Class City’ we imagine it to be?”
As we all know here on the Vancouver RE blogs, a similar unrealistic mindset has contributed to residential property prices that spiral ever upwards; a reconciliation with reality is coming.
Vancouver is a fine city, in many, many ways, and it’ll be that much finer when we see it for what it is, rather than for what some wish it to be.