“The impact of the pandemic continues to haunt Seattle. Huge effects on downtown businesses, both large and small. Demand for apartments has fallen dramatically, as rent rates have fallen as well. Work from home, no commute, closed restaurants/bars, higher crime, all make for less desirable living environment for high-end downtown renters…”
It’s going to take some time for the economy to recover from the Covid-19 crisis, the Downtown Seattle Association reaffirmed in an economic impact summary issued Wednesday.
It’s full of dispiriting data — and even those points that show improvement, it is mediocre at best.
Based on cellphone location data from Placer.ai, employee presence downtown during weekday office hours was down 82% year over year in October. At its lowest point in April, it was down 86%.
This has been disastrous for small businesses. The Downtown Seattle Association (DSA) has tracked 214 permanent street-level business location closures in Seattle this year, with 152 downtown. (DSA said its tracking is not a complete inventory and can only assume most closures are Covid-related.)
CoStar forecasts that for the first time since 2000, which is as far back as the company’s data goes, the number of downtown renter households will decrease, with the number of occupied units falling by 1,488.
During the second and third quarters, downtown lost an estimated 1,750 apartment households. For context, the previous worst quarter on record showed an occupancy decrease of only 42 units.
Downtown apartment vacancy rates are expected to rise from 5.1% at the end of 2019 to 11% at the end of 2020, with rents down 8.3% year over year. Apartment vacancy is expected to peak at 17.2% by 2022. (The figure includes new units; not including new units, vacancy is expected to peak at 12.5%.)
CoStar expects downtown office vacancy rates will reach 10% by the first quarter of 2021 and remain at that level for several years. This is up from a low of 4.9% in the third quarter of 2019, the lowest since 2000.
Total hotel revenue downtown has been down more than 90% nearly every day since mid-March. From April through July, hotel monthly revenue was down 95% each month compared with the same month in 2019. In the most recent monthly data available (October), revenue was down 87%.
This is according to Visit Seattle. Additional data from the group is here.
Restaurant revenues are falling again. By March 16, daily restaurant revenue in the city had dropped by about 80% from comparable days the previous year. In the following weeks, revenue recovered to be down between 40% and 45% year over year. The most recent Rally for Restaurants data ending Nov. 29, showed revenue was down 60% from the 2019 baseline.
By Marc Stiles – Staff Writer, Puget Sound Business Journal
Dec 4, 2020, 3:54 pm PDT