Vancouver Commercial Real Estate Podcast

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November 3, 2021
VCREP #26: What’s Next for Downtown Vancouver with Nolan Marshall

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It’s no secret downtown Vancouver has been slower than its pre-COVID form, but is it as bad as other cities? This week, Cory welcomes Nolan Marshall, the newly appointed CEO of the Downtown Vancouver Business Improvement Association (DVBIA) to discuss what’s next for downtown Vancouver and how things have fared over the pandemic. Nolan joins our city from New Orleans, where he experienced the devastating floods of Hurricane Katrina and played a role in rebuilding one of America’s great cities.

How is downtown preparing for the increased activity with the reopening of large venues such as Rogers Arena and the return to the office come 2022? Nolan paints a picture of the challenges ahead, shares a lot of the fun and excitement planned, and gives his take on the office market downtown, which may surprise you. As we look to better times ahead, Vancouver could have the perfect man in place to lead downtown through the end of the pandemic and to the return to normal… But before we let Nolan go, he shares his best commercial real estate advice that won’t disappoint!

Please tell us about yourself.

I got into placemaking in a very unique way. I am from New Orleans and was living there in 2005 with a business and a home that I owned. After Hurricane Katrina hit in 2005, I had the choice to rebuild my business or get involved in something else. Something else to me was making a place anew – that’s what placemaking meant to me. I moved into working in criminal justice and policy reform, but my career has always been about rebuilding places and making them as good as they can be.

I was working in economic development with small businesses in New Orleans when the pandemic hit. I had been given the opportunity to create my own title at the time and decided on Chief Engagement and Solutions Officer. So when the pandemic hit, everyone was looking at me for answers. We pivoted to helping people who were out of work and investing in small businesses. The work was challenging but very invigorating.

I got a call about an opportunity in Vancouver that I thought was a scam at first. But it obviously wasn’t. My wife and I thought about what would be best for our two children and the opportunity to give them an immigrant experience in a world-class city was very attractive. So we loaded up our car with the kids and our dog, drove for eight days, quarantined for 14, and then I went to work the next day as CEO of the Downtown Vancouver Business Improvement Association (BIA).

Can you tell us more about your role as the CEO of the Downtown Vancouver BIA?

The Downtown Vancouver BIA is an organization that champions everything that happens in the downtown environment. We are the protectors of public space. We want to add value, and keep people and places safe. This summer we did a Granville Street Promenade on the weekends to attract visitors to areas of the city that need a second look. We want to increase foot traffic downtown, increase investment, support retailers, and ensure the downtown environment is one people want to be in.

Was there something you could draw on from your experience in 2005 in New Orleans when it came to getting through the pandemic here in Vancouver?

It’s all been about value-add for me. The first thing is you have to act urgently. Vancouver is known in the planning community as a city that is slower to innovate. When I arrived, the city had already innovated with a patio program. Without a pandemic, who knows how long that program would have taken to put into place? So I was glad to see we acted quickly.

The second thing is you have to support the small businesses because those are the businesses that are the most vulnerable. My concern was for the street-level businesses that relied on foot traffic. What happens to those businesses when office workers come back but on a part-time basis? We have to figure out how to support those businesses.

What are you hearing from those businesses? We’re seeing a lot of demand for retail locations on the commercial real estate side. But what are you hearing on the ground?

Entrepreneurs by nature are optimistic. We have demand from optimistic entrepreneurs and we have the limited land supply of Vancouver. There will always be demand here because we’re so land-constrained. My question is if businesses are basing their models off of pre-pandemic numbers or are they accurately gauging what the future will hold?

For my colleagues in other downtowns across North America, they’re not faring as well as we are in Vancouver. Even though Translink’s ridership is down, it is leading in ridership across North America. So that is leading to more optimism in Vancouver. But if community habits change, business models will have to change. I don’t know if we’re calculating for that. I don’t know if we have the right interventions.

Will we have the return of the robust cruise industry? Will business travel return? How can we increase visitors to downtown if we don’t have office workers? Should we rethink how we are building residential in the core? We have a housing crisis and we have a shortage of hotels in Vancouver. I’m not concerned about our ability to build a dynamic environment but the people mix and the numbers may change.

Let’s talk about the hotel industry. What are the hotels saying?

The numbers for hotels are still at pandemic levels but they are increasing. We are fortunate that we were underbuilt in hotels before the pandemic. So we’ll come back a lot quicker because we don’t have the supply of some of the bigger cities.

We’ve been hearing a lot about crime in the downtown core lately. What are businesses seeing? What plans are in progress to rectify this?

Public safety is a very complicated problem to address as a community. When I was in New Orleans in 2005, my job was to rebuild public trust through public safety and criminal justice reform. That’s the basis for an economically vibrant community.

Downtown Vancouver is one of the safest downtowns in North America – that’s not an opinion, that’s a fact based on the data. It’s not an unsafe community. But we have had an increase in property crime and stranger-on-stranger crime.

We’re trying to understand the complexity of the problem. We don’t want to criminalize homelessness or addiction; we’re working with partners to get those complex care and public health needs addressed. We’re also working with the VPD on how we can create programs that target a criminal element with appropriate consequences for repeat offenders.

It is a challenging problem. You can’t solve it in a week, but it is solvable. How do we build partnerships that can create a public safety environment that makes people feel safe?

Rogers Arena is a big part of the business community down here. Has the reopening of Rogers Arena caused some optimism and an injection of business?

Absolutely! It’s huge to have that many people returning to downtown and supporting the restaurants and retailers around the arena. That will have a huge impact on downtown businesses.

That support happens when there is a special event, like a hockey game or a concert. So the more activities we can support and endorse in the downtown environment, the better. They’re meaningful for human connection and they’re something the businesses really need. We need clubs back open with dancing, Robson Square skating to be open, more street activations, etc. And I don’t say that because I like to have fun. I say that because those events will support the downtown businesses.

Are you hearing concern from developers who might have to rethink their plans?

I’m hearing what I expected to hear when I arrived because the same thing is happening in every other downtown across North America. You’re seeing projects that were intended to be 100% commercial switching to residential or mixed-use or just stalling.

But the industry here is very bullish on the need for office space in Vancouver. It will look different, but there’s such a high demand in a constrained building environment. That is what is driving the continued push for more commercial.

What are you hearing from your office tenants? Are people planning to come back to the office, even if it looks different?

Yes. If you look at Amazon, they’re still looking to fill their space but they might not have all of their employees in at the same time. It’s like you were saying: folks in smaller offices might need more space so their employees can spread out and folks in larger offices might downsize if not everyone will be in the office at the same time.

That’s why I’m not concerned with the office space between floors 3 and 35. The vacancy rate in Vancouver was astronomically low before the pandemic. So even if it increases by 9%, that’s still healthy. We’re in a very healthy commercial environment.

If for some reason the commercial environment shifts, we are underbuilt for hotels and residential. The building boom downtown is not going to stop. If it stops being office in the next 10 years, it will switch to the next thing we need.

Assuming everything goes well, what do you envision the next six months looking like for downtown?

We are optimistically looking at increases in return for work in early 2022. There’s no hard data on who is coming back and when but anecdotally, we are all hearing that 2022 is when companies will begin requiring people to come back into the office, at least part time. In preparation for that, we want to ensure workers are coming back to a downtown that is clean, safe and vibrant.

We mistimed it thinking folks would come back in the fall and had a promotion to try and help people get back into the work routine. We’ll be promoting things like going to happy hours, eating lunch at their favourite spots and hanging out with colleagues as people return to work.

What advice would you give to downtown business owners looking to get through this time?

We are in a global pandemic and shouldn’t lose sight of that. Every metric is as strong in Vancouver as it is anywhere. We are in the right place.

Cities recover after disasters; I know that firsthand with a city that was literally underwater. I know what the small businesses are going through. But these businesses should be encouraged and thinking about how they want to position themselves going forward. Downtown Vancouver may look different but it will be as strong as any other downtown around the world.

Find out more:
Twitter @NolanMarshall

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Vancouver Commercial Real Estate Podcast

For all the curious minds interested in commercial real estate investing, grab a coffee and pull up a chair because we have exclusive stories and tips from commercial real estate brokers, investors, developers, economists, urban planners, and everyone in-between. From the successes and failures to the motivations and lessons learned, the Vancouver Commercial Real Estate Podcast is your insight into commercial real estate in Vancouver, Victoria, Kelowna, and beyond.

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