High retail vacancy marks downtown Victoria
CTV British Columbia
Published Monday, December 24, 2012 6:18PM PST
Last Updated Monday, December 24, 2012 6:46PM PST
A high number of vacancy signs in Victoria are causing concern for some retailers.
The city’s downtown retail vacancy rate has more than doubled since 2008, and now sits at about eight per cent.
Tom Thompson is the owner of men’s clothing store W.J. Wilson that’s been selling clothes from the same downtown location since 1862. He sees high taxes as part of a definite problem for small businesses.
"The first $250 goes towards city taxes, the next $1000 goes to the landlord, and then I can start thinking about paying my staff and all the other costs."
Retailers like Thompson are getting a municipal tax hike of three per cent per year over the next three years. According to a recent study by the Canadian Federation of Independent Business, Victoria retailers already pay 3.5 times more than residential homeowners.
Kimball Kastelen from CFIB, says one issue is that the taxes are profit insensitive.
“This is a tax that needs to be paid even if they’re otherwise losing money,” said Kastelen. “During critical periods or downturns in the economy, this can absolutely mean the difference between survival and going under.”
Aside from high taxes, there’s concern that many retailers are moving to shopping malls and leaving the downtown core.
Dave Ganong from real estate company Colliers International, said they are concerned, but don’t think the loss is permanent.
“I really believe in light of strong competition, that’s drawn some of those key retailers out of the downtown core,” said Ganong. “Is that a permanent exodus? I don’t think so.”
Thomson hopes that by cutting costs, the business his family has run for the past 50 years can continue. Ganong is optimistic that the downtown can make a full comeback.
“There are so many fundamentals and positives happening downtown. Eventually, and with the help of some political leadership, I think we can really turn this around," he said.
With files from CTV British Columbia’s Ed Watson