Two numbers from 2010 will make a difference in 2011: 0.05 and $90.
The first is the new blood-alcohol level that has spooked driving diners and wounded car-dependent restaurants. The second is the price of oil, predicted to reach triple digits in 2011 as demand rebounds with the improving global economy. Both are related to cars, suburbs and Vancouver’s green economy.
“The people who used to have two beers and drive home don’t do it anymore,” Gastown restaurateur Sean Heather told the Vancouver Sun late last year.
He attributes a 12% rise in his business to being near where a lot of customers live, where the effects of the 0.05 limit don’t matter. His customers can walk, take a short bus or taxi ride or cycle home.
There’s a parallel current in the commercial real estate market. Businesses, like restaurant patrons, are being attracted to downtown locations. With a big thank you to the Olympics, Vancouver has been the top market for real estate investment in North America for the past two years. Downtown office vacancies are at a five-quarter low (5.5%) compared with a U.S. national office vacancy rate of 14.9%.
The growth is coming from businesses as diverse as English as a second language colleges (said to be the largest tenants of downtown office space) and mining headquarters (seven of the 10 fastest-growing companies in B.C. are in mining – BIV issue 1090; September 14-20, 2010).
Telus has come forward with the first new downtown office tower proposal in almost a decade. We hear there’s a market for two, maybe three new commercial towers while city hall looks at six new sites downtown for commercial buildings higher than the current 350-foot limit.
Some of the downtown office boom is coming from businesses fleeing the suburbs. Microsoft and HSBC have moved into town, and some of the new digital media companies setting up here have chosen downtown: Sony ImageWorks, Digital Domain and Pixar.
The flight from the suburbs is happening all over North America. Houston, Las Vegas, Miami, Pittsburgh and Phoenix have all seen occupied office space increase downtown but drop in the suburbs. Manhattan gained 1.8 million square feet of occupied office space in 2010, just about equal to the amount of space lost in its adjoining suburbs. Big U.S. real estate investors are now favouring traditional urban areas.
Why move to downtown and SkyTrain-linked locations from suburbs where rents are cheaper, vacancy rates are as much as three times as high and parking is free? Could it be that businesses are hedging against the doomed suburb in an age of oil prices at $90-plus per barrel, surrounding themselves with sidewalks, bike lanes and transit routes for protection? Maybe they’re hearing messages like the one from Georgia Institute of Technology architecture professor Ellen Dunham-Jones.
“Your child is 10 times more likely to die from a car crash in the suburbs than to die in a pool of blood in any other manner in the city,” she said at a recent Vancouver lecture.
Maybe they’ve discovered that hip young knowledge workers are keenly aware that ecological footprints are much lighter in stacked-up downtown offices, where they can walk home, post-0.05, from the office party.
Maybe, landing in the lap of Vancouver’s green capital rhetoric, companies locating downtown (and in compact centres in the suburbs) are looking at the energy/cost-savings from being green.
While Toronto is branded as Canada’s financial centre, Calgary its energy centre and Seattle as a Pacific Northwest high-tech centre, Vancouver will continue to fumble for its identity in 2011 as a “green capital.”
So far, that has been about attracting so-called “green businesses.” Maybe walking home from the bar and dodging rising gas prices is the key to Vancouver’s green capital quest: putting any business into its dense, pedestrian-transit-bike-oriented downtown.
Just being downtown – or anywhere close to transit – is the new green, in more ways than one.