Seattle Commercial Real Estate LLC has for years pointed to the Central Business District of downtown Seattle (CBD) as key to Seattle’s long-term health. The CBD is the source of 65% of the revenue for the City of Seattle. The liberal bent of the City Council over the last 4 to 5 years has been impacting Seattle’s commercial real estate. We explored Seattle’s office market and multifamily in a series of articles. Downtown retail is another facet that needs to be explored.
Seattle Tourism Rebounds. What about Retail?
The summer of 2023 was great for downtown Seattle and tourism, opening of the new phase of the convention center and increasing office traffic were signs of a positive resurgence. A Taylor Swift concert does not cure a nearly 15% vacancy rate in downtown commercial real estate. The fall in new business license applications from 604 (first quarter) in 2019 to a low of 236 in the first quarter of 2023 and only a 90% occupancy level in retail tells another story.
Is Seattle Downtown Getting Safer?
The fall election cycle brought in a new majority to the city council. New does not necessarily mean experienced. Only time will tell, but the push to hire and pay for adequate police staffing and public safety has not met the stated goals. There is a higher level of prosecutions, but as Seattle Commercial Real Estate has pointed out over the last several years, until the office market returns to full health and occupancy and until the streets are clean and safe, there are reasons to move with caution. That movement is still going on today and it means a lot of people moving across Lake Washington to Bellevue and the Eastside. Seattle Commercial Real Estate is watching. Our clients are waiting. We see problems as an opportunity, but only to be exercised with caution.
