Port city showdown
Tacoma’s gritty downtown masks its status as Washington state’s top port in Jones Lang LaSalle’s (JLL) recent Seaport Outlook report, ranking fifth in North America thanks to its large and available stock of industrial real estate.
Sixth-place Vancouver, with a vacancy rate of 4.9% on 77.6 million square feet within 24 kilometres (15 miles) of its port properties, is a tight market versus Tacoma, where vacancies are running 5.7% on a stock of 107.8 million square feet.
“Tacoma has, frankly, a larger industrial stock … and there’s more available inventory on hand,” explained Dain Fedora, the Los Angeles-based research manager for JLL’s port, airport and global infrastructure division. “In that sense, Tacoma is more favourable than Vancouver.”
But don’t count out Vancouver. It’s still the top port in Canada, handling a diverse product mix that’s on track to rise 15.2% over last year’s 2.9 million TEUs (20-foot equivalent units, the industry’s measure of cargo volumes).
Tacoma, with a volume of two million TEUs and a year-to-date decline of 4.9% – eat your heart out. It’s also serving up the next-generation space tenants want, JLL senior vice-president Lee Hester said, handling more cargo and making more efficient use of its limited land base.
“You have a very strong private sector here that can meet the demand,” he said. “Vancouver’s vacancy rate is low … because we are building [space] for these users.”
A combination of government investment in port infrastructure, Canada’s low dollar, and rail connections to the heart of the continent make Vancouver the place to be in Hester’s opinion.
“There are logistical benefits of being in Vancouver, and cost savings of being in Vancouver,” he said. “I’ve never seen it like it is now for addressing the needs and meeting the needs. All the entities are working in conjunction.”
Seattle openings
Nordstrom may be the latest U.S. retailer to enter the Vancouver market, but spare a thought for the Vancouver retailers looking south.
Vancouver spa Skoah hit Boston five years ago and in 2013 opened locations in Seattle.
Skoah’s location in Capitol Hill heralded the neighbourhood’s dramatic makeover, and now two more Vancouver operators have entered the ’hood: sushi bar Suika and sandwich slinger Meat & Bread.
“It just felt quite natural to us. Seattle’s just a couple of hours down the road,” Frankie Hamilton, co-owner of Meat & Bread, said.
A first shop opened on April 16, and a second location will open in South Lake Union in October.
Whatever opportunities Canada has held for U.S. retailers, and whatever bets brokers have placed on the next big brand to head north, Hamilton said there’s room for good concepts on both sides of the border.
“As long as you have something that’s exciting and quality, there are opportunities for anyone to go anywhere,” he said, noting that Meat & Bread isn’t ruling out adding to its existing locations in Vancouver, Victoria and Seattle.
“One step at a time, but definitely, in the future we’d like to grow,” Hamilton said.•
