The Changing Face of Robson Street Retail

Robert Simpson, Liberty Wine Merchants | BCBusiness
Robert Simpson at Liberty Wine’s former Robson Street address.

A changing of the guard on Vancouver’s Rodeo Drive.

In late spring, the number of storefront vacancies on Robson Street had people talking. The obvious explanation would seem to be simple math: in the wake of the global economic meltdown, the high overhead on Vancouver’s counterpart to Rodeo Drive, coupled with diminished retail spending, added up to a death knell.

Not so fast. Tenants past and present and seasoned real estate observers say the street is simply going through a transition, as it’s done previously.

Sherman Scott, associate vice-president at Colliers International, draws on two decades of experience in Vancouver commercial real estate. He points to global consumer forces at work when he says, “I like the phrase, ‘a changing of the guard.’ Blockbuster and HMV are gone, but is that a surprise? Nobody buys CDs and DVDs anymore. Five years ago you didn’t see any vacancies, so it looks strange, but there’s plenty of competition for the open spots.”

Scott points to who’s staying in the area – among them Louis Vuitton, Tiffany & Co. and Armani Exchange – and who’s coming in: a 12,000-square-foot CB2 store (a Crate & Barrel affiliate that will be in the renovated Pacific Palisades Hotel), a multi-storey location for clothier Forever 21 (in the 1100 block) and J.Crew, which has already moved in at 1088 Robson, the third Canadian location for the American clothing retailer.

Robert Simpson, general manager of Liberty Wine Merchants, a former Robson tenant, says that “it’s no secret JCPenney, Target and Nordstrom are all actively looking at the Sears location” on the street. (Owner Cadillac Fairview recently bought back its lease from Sears in anticipation of redevelopment for a new anchor tenant.)

David Goldman, owner of Boys’ Co and a 25-year retail veteran on the street, downplays the idea that demolition or renovation clauses are a major factor in leaving the area. “I have one in my lease, as any prudent landlord would ask for, and we negotiated a reasonable provision. It’s not an issue I’ve heard of with any other retailers,” he recounts.

Goldman confirms it’s expensive to do business on Robson, with rents “between $175 and $220 per square foot, then property taxes and maintenance up to $50 on top.” According to a 2012 Colliers International retail report, nationally only Toronto’s Bloor Street is pricier. Globally, Robson Street checks in just outside of the top 50.

But Goldman doesn’t believe there are an alarming number of vacancies. “It’s no more than a handful, the major ones being the Starbucks [at Robson and Thurlow] and the Esprit location [at 1160 Robson]. But they’ll be snapped up. The harder ones will be the little spots because it’s an expensive location for an independent retailer.”

Which is what Goldman is. He says that during the recession of 2009 and afterwards, Boys’ Co took its lumps but hung in. He’s not concerned that American and other foreign retail giants will push smaller companies, such as his, out. “I have a 17-year-old son whose favourite place to buy clothes is H&M, and that’s fine. They have their customers and we have ours. The competition forces us all to be on our toes and that’s how the little guy stays on Robson.” And now? “I’d say business is up 20 per cent over the last couple of years. The street is as strong as ever.” For Boys’ Co, Robson Street delivers what the retailer pays for.

For others, things changed. Liberty Wine’s Simpson has had a long relationship with Robson (his father was born in a hospice on the street in 1918, when it was largely residential), and says that he’s seen this all before. “In my lifetime it changed from a heavily German and European presence with schnitzel houses and bakeries and delis in its Robsonstrasse era, to fashion and high-end stores. And now it’s changing again.”

For Liberty, the Pacific Palisades Hotel on the 1200 block of Robson was a great location for more than five years, with a dedicated clientele looking for a good selection of fine wines. The company had a cordial relationship with its landlord, Anthem Properties, and while the rent was high, Simpson felt he got what he paid for – until he didn’t.

“New liquor outlets moved in, pedestrian traffic patterns changed, we became a bit of a convenience store rather than a wine merchant,” he says. “When we opened we had a nice corporate clientele and we couldn’t keep Champagne on the shelves. By the end we were selling a six-pack to someone on their way home from work. The average check declined by half.”

Simpson says that by last August, when the hotel was sold – prompting eviction under a demolition clause by the new owners (Austerville Properties Ltd.) – the location was simply no longer working the way it had, thanks to a downscaling demographic. The relocation decision was not difficult. Commercial Drive near First Avenue offered him an opportunity to nearly double the store’s size to 1,400-square-feet while paying a little more than one-fifth of its former rent. (Commercial Drive averages around $40 per square foot.)

“To be honest, we don’t miss Robson Street. We have a parking lot across from us and street parking, our customers have doubled and there’s no one playing the banjo in front of our door.”