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People dine on a patio at a restaurant in Vancouver, B.C., on April 2, 2021.DARRYL DYCK/The Canadian Press

Vancouver’s downtown has surged to life faster than the city cores of every major West Coast U.S. city as well as Toronto and Montreal, but its restaurants are still struggling to make it, according to new data on recovery from the COVID-19 pandemic.

While Vancouver hotels, shops and offices are doing relatively well, people aren’t making as many trips downtown, by car or transit, as they used to, says a report released Wednesday by the Downtown Van business association on the state of the city’s downtown this past year.

“By most measures, Vancouver weathered the pandemic fairly well. By all accounts, things are moving in the right direction,” said Jane Talbot, Downtown Van’s executive director. “There are more people coming downtown than in 2019, but not as often.”

Vancouver’s downtown recovery ranking rose from 54th in 2022 to 17th by October, 2023, among 66 Canadian and U.S. major downtowns, with an 85-per-cent recovery rate, according to statistics gathered by the University of Toronto’s school of cities.

It far outperformed Toronto (at 70 per cent) and Montreal (67 per cent), as well as San Francisco (67 per cent), Portland (61 per cent) and Seattle (57 per cent) on the American Pacific coast. Los Angeles was ranked at 20, with an 83-per-cent recovery rate.

The robust return of tourism in Vancouver, which included a record number of cruise-ship stops in the summer of 2023, appears to have had an impact. Hotel occupancy was back to 79 per cent, close to the 80 per cent it was at before the pandemic, the Downtown Van report says. Sales on Vancouver’s luxury shopping street, Alberni, were up 21 per cent, compared with increases of 5 per cent to 13 per cent on other major downtown shopping streets.

Vancouver leads the way in building boom for hotels

Vancouver’s downtown recovery benefited in part because it has a large residential population surrounding its central business district, with almost 100,000 residents. That big residential component also means that office workers who work downtown are less put off by unpleasant commutes, since many of them can walk to work.

In spite of those chunks of good news, there are still worrying trends, the Downtown Van report found.

There’s a 13-per-cent vacancy rate overall downtown, and that rises to 20 per cent along Granville Street, part of which is the city’s raucous entertainment district.

And Vancouver restaurants, from high-end to fast casual, continued to struggle, according to both Downtown Van and the BC Restaurant and Foodservices Association.

The skyrocketing cost of food supplies, along with increased costs for labour and the lingering drag of trying to pay back pandemic loans, are all affecting restaurants’ ability to stay in business, said Ian Tostenson, the association’s executive director.

Because many restaurants have had to increase their prices noticeably, people have changed their buying patterns, he said: “People are going out, but they are purchasing differently. They’re more inclined to go to happy hour or to share dishes.”

Data from Vancouver’s business-licence records show that the city issued 1,792 licences for Class 1 restaurants in 2022, then jumped up to 2,073 in 2023. But then it lost almost 170 of those, with only 1,901 licences issued so far for that category in 2024.

Among the restaurants that closed in 2023 in Vancouver are the popular Italian Autostrada on Pender Street, although it still has two other outlets open; Heritage Asian Eatery on the part of Broadway that is still heavily blockaded by subway construction; Daisy Garden, a legacy restaurant in Chinatown; all four of the Scuié coffee shops downtown; Ganache Patisserie in Yaletown; Jules Bistro in Gastown; and Chef Hung Taiwan Bistro on Smithe.

Just in March, another two dozen announced closings.

Many operators have cited big rent increases or the constant fight to keep revenues ahead of costs as reasons they were closing. (The majority of spots, however, have seen new restaurant operations move in.)

Restaurants Canada, a not-for-profit organization, reported in October that 51 per cent of all locations in the country are losing money.

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