Sales among downtown Long Beach's 400-plus retailers decreased by about half in the first two quarters of 2020 compared with the same time in 2019, according to a report issued today by the Downtown Long Beach Alliance.
During the third quarter, rental rates for downtown retail spaces decreased by about 3% compared to the same period in 2019, according to the Third Quarter Snapshot Report, which provides in-depth analysis of downtown's real estate market through Q3 2020.
The report draws on data from real estate analytics firm CoStar Group, the city of Long Beach Economic Development Department, DLBA's April 2020 COVID-19 Economic Impact Survey, and empirical information gathered from downtown parking meters and garages.
The retail market experienced a negative net absorption of nearly 19,000 square feet in Q3 2020 following a negative net absorption of 15,586 square feet in the prior two quarters. However, the overall occupancy rate of downtown retail space remains high at 93.6%, the report states.
Data analyzed in the report reveals these trends are not unique to downtown Long Beach. Cities with similar inventories of retail space, such as San Pedro and Santa Monica, also experienced decreases in rental rates and occupancy levels through the first three quarters of the year.
"Undoubtedly what we're noticing in the downtown retail sector is a direct result of the COVID-19 pandemic and the restrictions on business operations,'' DLBA research and policy analyst Morris Mills said. "A citywide economic impact survey conducted earlier this year revealed that man businesses attributed losses in revenue to the health crisis. We plan to follow up with another survey soon to gauge current impacts now that more of the economy is open for business, as well as future expectations among the business community."
Parking data included in the report reveals that activity is picking up somewhat in downtown. Parking occupancy rates increased slightly in Q3 compared to Q2 2020, but still lagged recorded activity from the same period in 2019. During Q2 and Q3 2020, revised public health orders allowed for more business types -- including bars with food operations -- to reopen.