downtown new west market study_09

8/2/2019 Downtown New West Market Study_09

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APRIL2009

UrbanicsConsultantLtd.

DOWNTOWN COMMERCIALLAND USE MARKETABILITYSTUDYCity of New Westminster, British Columbia


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DOWNTOWN COMMERCIAL LAND USEMARKETABILITY STUDY

City of New Westminster, B.C.

Prepared for:The City of New Westminster

April, 2009

Prepared by:Urbanics Consultants Ltd.Suite 2000 - 355 Burrard Street,

Vancouver, B.C., V6C 2G8


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TABLE OF CONTENTS

1.0 INTRODUCTION............................................................................................... 1

2.0 STUDY AREA ASSESSMENT......................................................................... 4

2.1 HISTORICAL/CONTEXTUALFACTORS............................................. 42.2 TRANSPORTATIONCONTEXT ............................................................. 52.3 FRONTSTREET/NORTHFRASERPERIMETERROAD................... 72.4 LANDUSECONTEXT............................................................................... 72.5 OTHERGEOGRAPHICAL/CONTEXTUALFACTORS .................... 82.6 STUDYAREADELINEATION .............................................................. 10

3.0 DEMOGRAPHIC & ECONOMIC OVERVIEW......................................... 11

3.1 POPULATIONGROWTH....................................................................... 113.2 DOWNTOWNPOPULATIONDEMOGRAPHICS............................. 113.3 GENERALSTATISTICS........................................................................... 153.4 HOUSEHOLDSTATISTICS.................................................................... 153.5 INDUSTRYSTATISTICS ......................................................................... 173.6 ECONOMICCONTEXT .......................................................................... 19

4.0 RETAIL MARKET ANALYSIS ...................................................................... 20

4.1 RETAILTRADEAREADELINEATION:.............................................. 204.2 RETAILSUPPLY....................................................................................... 214.3 RETAILDEMANDANAYSIS................................................................. 254.4 TRADEAREAPERCAPITAEXPENDITURES.................................... 254.5 RETAILMARKETSUMMARY............................................................... 38

5.0 OFFICE MARKET ANALYSIS....................................................................... 41

5.1 OFFICESUPPLY....................................................................................... 415.2 OFFICEDEMAND ................................................................................... 435.3 OFFICEINVENTORYPROJECTIONMETHOD................................. 455.4 OFFICESPACEPERCAPITAPROJECTIONMETHOD.................... 475.5 WARRANTEDOFFICESPACE.............................................................. 49

6.0 HOTEL MARKET ANALYSIS....................................................................... 516.1 STUDYAREADELINEATION .............................................................. 516.2 HOTELSUPPLYANALYSIS................................................................... 536.3 HOTELDEMANDANALYSIS............................................................... 576.4 EXTERNALINFLUENCESOFFUTUREDEMAND........................... 646.5 INTERNALINFLUENCESOFFUTUREDEMAND ........................... 656.6 HOTELCONCLUSION........................................................................... 66


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7.0 CONFERENCE FACILITY ANALYSIS ........................................................ 67

7.1 CONVENTIONANDMEETINGSPACESUPPLY ............................. 677.2 FACTORSINCHOOSINGALOCATION&VENUE......................... 707.3 CONCLUSION.......................................................................................... 73

8.0 STRATEGY RECOMMENDATIONS .......................................................... 74

8.1 BOOK-ENDCONCEPT ........................................................................... 748.2 DEMANDSIDERECOMMENDATIONS............................................. 758.3 SUPPLYSIDERECOMMENDATIONS:................................................ 778.4 PLANNINGRECOMMENDATIONS................................................... 798.5 DOWNTOWNDEVELOPMENTCORPORATION............................ 818.6 OTHER ....................................................................................................... 82

9.0 LOCATIONAL CONSIDERATIONS........................................................... 83

9.1 LOCATIONALCONSIDERATIONSBYLANDUSETYPE............... 83

10.0 DOWNTOWN DEVELOPMENT CORP...................................................... 85

10.1 PUBLICSECTORENTITLEMENTS ...................................................... 8510.2 IMPLEMENTATIONSTRATEGYOPTIONS....................................... 8810.3 DISPOSITIONOPTIONS......................................................................... 9110.4 IMPEDIMENTS......................................................................................... 9210.5 RECOMMENDATION ............................................................................ 94

LIST OF TABLES AND FIGURES

Table 1 Population Projections Base Case, Low Case, and High Case

Table 2 General Statistics (Population, Age, Income, etc.)

Table 3 Household Statistics

Table 4 Industry and Employment Statistics

Table 5 B.C. Per Capita Retail Expenditures

Table 6 New Westminster Per Capita Retail Expenditures


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Table 7 Convenience Shopping Market Demand

Table 8 Comparison Shopping Market Demand

Table 9 Eating and Drinking Market Demand

Table 10 Service-Commercial Market Demand

Table 11 Retail Demand - Summary

Table 12 Greater Vancouver Office Market Statistics

Table 13 Downtown New Westminster Office Market Demand Forecasts Method 1

Table 14 Downtown New Westminster Office Market Demand Forecasts Method 2

Table 15 Downtown New Westminster Office Market Demand Forecasts Summary

Table 16 Hotel Supply Inventory

Table 17 Downtown New Westminster Hotel Demand Forecast

Table 18 Study Area Business Incorporations

Table 19 Metro Vancouver Tourism Indicators

Table 20 Top Factors in Choosing a Meeting Location

Table 21 Top Factors in Choosing a Hotel Facility Within a Specific Location

Figure 1 Hotel and Office Study Area Delineation

Figure 2 Hotel Supply Map


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1.0 INTRODUCTION

The City of New Westminster has retained Urbanics Consultants Ltd. toundertake a study of the commercial land use marketability for its Downtown

area, with residential land uses to be excluded from this study. This is within thecontext of the New Westminster Downtown having been identified as one of theeight Regional Town Centres in the Metro Vancouver areas Livable RegionStrategic Plan.

The key objectives of this study are to determine the commercial marketpotential of a study area defined as Waterfront to Royal Avenue and Highway 99to Columbia Street at Royal Avenue, and to provide an indication of the amountof gross building area which is warranted for each category of land use duringincrements of 5-year phases over the course of the study period, together with

preferred locations for each category of use under various scenarios of marketstrength.

Furthermore, the consultant has provided a substantial list of policyrecommendations and implementation considerations to support the land usemarketability of Downtown New Westminster. It is the consultants consideredopinion that, in the absence of the full implementation of many of theserecommendations, the forecasted analyses contained in this report will likely notbe achieved, and even the low scenario may in fact over-state the actualperformance of the study areas commercial land uses.

The report is organized as follows:

1. INTRODUCTION

2. CONTEXTUAL OVERVIEW: Evaluates the key physical and locationalcharacteristics of the area, particularly with respect to the office, retail,hotel, and other non-residential land uses under consideration.

3. DEMOGRAPHIC & ECONOMIC OVERVIEW: Provides an assessmentof population projections and demographic trends are examined for the

study area.

4. RETAIL MARKET ANALYSIS: Based on population growth and percapita expenditures in the study area, a forecast of total retail expenditurepotential can be made. Weighing demand against the competitiveinfluences inside and outside the study area, the amount of warrantedretail space, on a category by category basis, is projected for the study area.


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5. OFFICE MARKET ANALYSIS: A projection of warranted office spacedemand for the study area is made for the next three 5-year increments ofthe study period, using two methods: examining the historical growth inoffice space within the surrounding suburban markets, and employing a

per capita figure suitable for New Westminsters office marketcircumstances.

6. HOTEL MARKET ANALYSIS: A comprehensive review of the hotelsupply in the study area, as well as a review of tourism and businessindicators in the hospitality market is also undertaken, coupled withforecasts for hotel demand in order to rationalize the acceptable numberof on-site hotel rooms that could be supported by the market.

7. CONFERENCE FACILITY ANALYSIS: A comprehensive review of the

conference space supply throughout the region and province, coupledwith a recommendation as to the perceived supported amount of newconference facility space in the study area.

8. STRATEGY RECOMMENDATIONS: Outlines the consultants list ofdevelopment and planning/land use recommendations to enable andcatalyze the successful expansion of non-residential land uses inDowntown New Westminster.

9. LOCATIONAL CONSIDERATIONS: Outlines the consultants primary

findings of the above land use marketability analyses and provides apreliminary list of development and planning/land use recommendations,including timing/phasing, warranted amount of commercial space, andconsideration of other potentially complementary land uses in the area.

10.DOWNTOWN DEVELOPMENT CORPORATION: One of the keyrecommendations of this report revolves around the creation of aspecially-mandated development corporation to act on behalf of the Cityas a means of creating the strategic developments necessary to catalyzegrowth and activity in the Downtown study area and by extension, forNew Westminster as a whole.

Information from a variety of sources, both public (e.g. Statistics Canada, BCStatistics, the Government of B.C., Metro Vancouver, the City of NewWestminster, etc.) and private were used in the preparation of this report,including the following:

First-hand area assessment and evaluation of subject land use inventory ina range of office, hotel, and retail-commercial related categories.


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Sourcing of trade area demographics and retail trade data for use indemand analyses from Statistics Canada.

Population growth projections based on provincial data and theconsultants forecasts.

Additionally, as with all market studies, a number of forecasts and assumptionsregarding future economic and population growth are required. This isespecially true in light of the current economic uncertainty. These assumptionsare made with great care and are based on the most recent and reliableinformation available. In addition to the specific assumptions identifiedthroughout the report, this study is based on the following general assumptions:

Real per capita expenditure growth for all trade area residents will notgrow less than an average of 1% per annum over the course of the studyperiod.

Actual population growth rates both in and around the study area willoccur consistent with those employed in this study.

No unforeseen events will occur within the study period on a global,national, provincial, or local level (for example, terrorist activity, majorchanges in government policy, natural disaster, etc.) which wouldseriously alter the fundamental assumptions of the studys analyses.

If any of these assumptions should prove to be incorrect during any part of thedevelopments pre-planning phase, a report update would be stronglyrecommended.

Research for this study was undertaken by the consultant during the months ofDecember 2008 to March 2009.

An additional matter that requires some clarification is the use of the wordDowntown. In all instances, unless specifically indicated otherwise,Downtown shall refer to Downtown New Westminster, as defined in the studyarea delineation section below. Wherever possible, the consultant has specificallyidentified other downtown areas (e.g. Downtown Vancouver) so as to avoidconfusion.

It should also be noted that, where appropriate, sensitivity analysis has beenbuilt into many aspects of the study, to deal with uncertainties about the future(including population and income growth) and to allow for a base case as well asa high-attraction and low-attraction scenario to further qualify these findings.


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2.0 STUDY AREA ASSESSMENT

This study area assessment offers analysis of the subject area from the standpointof regional and local access provisions, public transportation connectivity,

surrounding land uses, and other contextual factors and their possible positiveand negative impact on the Downtown.

2.1 HISTORICAL/CONTEXTUAL FACTORS

1. The inability for Downtown New Westminster to undergo considerablenew office and, to a somewhat lesser extent, retail development has been aproblem for a long time now, and is not a recent development.

2. Whether intentional or not, there has been an enormous surge ofDowntownism uptown (that is to say, there has been a sustainedgrowth in mid- to high-density residential, retail, and to a lesser degree,office space in the Uptown area around Royal City shopping center.Resident demographics are also a bit stronger uptown as opposed todowntown (for instance, from a population, age, and income perspective).While this area is perhaps not performing to its full potential incomparison to other retail clusters in the region, Uptown is not sufferingas much as Columbia Street and the remainder of the Downtown.Furthermore, Uptown has stronger retail covenants, lots of parking, andconsiderable new development nearby, and so is able to attract betterquality retailers than is Downtown, which hurts Columbia Street.

3. Downtown New Westminster has inadvertently divorced itself overseveral decades from its riverfront, both with the train tracks and thetruck route, and then with the parkade and certain street closures. Thishas both blocked views and rendered the waterfront not easily accessible.This broken linkage results in losing the positive feedback had therelationship between the downtown and waterfront been maintained(Accordingly, one of the primary objectives for the Downtown should beto address this serious, harmful dynamic).

4. Less than 15% of the residents of Downtown New Westminster work inNew Westminster itself, and the proportion of people who both live andwork in Downtown is considerably smaller. This means that these peopleare not present in the Downtown during the day, and will likely do theirshopping and business near their place of work or along the way to/fromwork (especially if it is easily accessed from major arterials or SkyTrainfrom New Westminster, such as Big Bend or Metrotown).


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5. The vast majority of new housing on the waterfront just west of theDowntown has not been leveraged in terms of bringing more of theresidents to Columbia Street to shop and do business. This is because:

a. The physical disconnect and awkward connections to thedowntown from the riverfront residential area.

b. The demographic profile of the residents in that area is muchyounger than the metropolitan average and accordingly theirbehavioural/purchasing characteristics and commercial needs aredisconnected / unrelated to what is available on Columbia Streetand other downtown commercial precincts.

c. Because of their physical disconnect from downtown, mostresidents do their shopping near where they work, or are otherwiseable to easily access other nearby retail (e.g. Big Bend) or because ofthe accessibility created by SkyTrain go to other SkyTrain-serviced

areas (e.g. Metrotown or Downtown Vancouver)

6. Metrotown, Guildford, Coquitlam Centre, Big Bend, DowntownVancouver, and increasingly Surrey City Centre, are all sources of verystrong competition for comparison retail shopping, as well as office space.

7. Virtually every town centre and regional centre in Metro Vancouver iscompeting for office, institutional, and other employment-based land uses,and so attracting these uses to Downtown New Westminster will requiredifferentiation and a degree of innovation in order to compete with theseother areas.

8. The Front Street Parkade does not create a great deal of benefit forColumbia Street retail.

9. There is a total lack of a proper tenant mix, which prevents new retailfrom entering the area, which further compounds the tenant mix problem(this is a classic chicken and the egg problem, which is why therecommendations contained herein will have to be enacted in theirentirety to overcome this obstacle.)

2.2 TRANSPORTATION CONTEXT

As the geographic centre of the Metro Vancouver region, Downtown NewWestminster benefits from the confluence of several major regionaltransportation networks, both public (e.g. SkyTrain) and private (e.g. NFPR,Highway 99A). However, this also carries certain disadvantages: The proximityof the Pattullo Bridge and east-west movements between Brunette Avenue andthe Queensborough Bridge create a disruptive influence on the Downtown. Also,


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the presence of an active railway line along the waterfront compounds thesechallenges by severing direct linkages between the waterfront and ColumbiaStreet. East-west traffic on Front Street is further hindered by interactions withthe rail corridor. Furthermore, the crossing near 4th Street causes considerabledelay on a major truck route, with adverse implications for adjacent activities.

Given Downtown New Westminsters excellent transit accessibility - twoSkyTrain stations and relatively high frequency bus service - a significant andgrowing proportion of trips into and out of Downtown are made with publictransit, although the steep grade between Columbia Street and Royal Avenueinhibits other non-auto modes of accessing the Downtown.

Front Street requires specific attention due to its role as a major truck route, andthe severe delays caused by the at-grade rail crossing downtown, as well as itsmerging points with Columbia Street. Regional truck movements and severance

caused by the rail corridor are key issues in this area. In the east, Pattullo Bridgeconnections to and from Columbia Street and Royal Avenue are a major issue.The City has put in place a complex system of turning restrictions, one-waydesignations, and access restrictions to circumvent shortcutting throughDowntown en route to/from the Pattullo Bridge.

Through traffic, especially regional goods movement, is a huge challenge forDowntown New Westminster. Addressing the high volume of heavy commercialtraffic on Front Street and its poor interface with the adjacent railway line will becrucial to enhancing the Downtown environment and providing a meaningfulconnection with the waterfront. The proximity of the Pattullo Bridge and itsconnection with Columbia Street must also be considered.

Public TransitThe two Downtown SkyTrain stations, New Westminster and Columbia, arevery different from each other. Columbia is a major transfer point between theExpo and Millennium lines, while New Westminster is the focal point for busesand the high density residential areas at Plaza 88, Quayside, and the west end ofDowntown. With combined Expo and Millennium Line services from Columbiato Downtown Vancouver, service levels are close to 90 seconds apart duringpeak periods. Bus connections are possible throughout the area, as a result of

Columbia Stations interchange role. This transit connectivity is a beneficial asset,but has not yet been fully exploited.


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Parking and the Waterfront ParkadeThe Waterfront Parkade plays a role in providing parking for Downtownbusinesses and residents, but is at the end of its useful life. The parking lotappears to be largely underutilized, and it is increasingly recognized that theparkade exacerbates the divorce between Columbia Street and the riverfront, as

well as generates pollution and deters shoppers from Front Street shops.Accordingly, it is anticipated that potentially a portion of the parkade mighteventually be removed, although the consultant is not aware of any specifictimeline.

Connections to the WaterfrontNew Westminster has one of the regions few urban waterfronts, a setting thatcombines historic architecture, a true high street, and the potential for access to abroad swath of the Fraser River. The barriers to its redevelopment are many -through traffic and the presence of the Waterfront Parkade among them - but

significant thought must be given to the relationship between Columbia Streetand the waterfront, and ensuring pleasant, direct, and safe connections betweenthe two, for all modes of transport.

2.3 FRONT STREET / NORTH FRASER PERIMETER ROAD

The consultant understands that the options for the NFPR dont favour the use ofFront Street for the new road, because it is not practical to widen it. Furthermore,it may be years before the road is built. Unlike the other portions of the NFPR,

the New Westminster sectionfrom the Braid industrial area to StewardsonWayis the responsibility of TransLink. The other sections are being built by theprovincial government. So far the consultant understands that TransLink has noofficial position on the New Westminster alignment but is anticipated to bestudying it soon. The regional transportation authority is also not in a financialposition to pay for any alignment which would satisfy the city with propermitigation measures.

2.4 LAND USE CONTEXT

Downtown is growing, not just in terms of buildings, but in its place within NewWestminster as a neighbourhood where an increasing share of the Citysresidents live. Currently, about 15% of the Citys population lives in theDowntown. Although development is taking place in other parts of the city, therate of growth has been much more dramatic Downtown - its growth has been attwo and a half times the pace of the rest of the City.


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Downtown has been experiencing many physical changes, involving differentlocations, sites and land uses. These changes have taken place in the context of aregional surge in new residential development, but there have also been otherchanges in the physical makeup of the Downtown involving the closure offacilities. The greatest change in the Downtown has been the almost tripling of

the total amount of housing floor space. The fastest period of growth was in thelate 1980s and early 1990s, with the development of former industrial land alongthe riverfront on Quayside Drive. The most recent increase in activity is relatedto strong demand for residential units occurring throughout the region.

In the past 20 or 25 years, the overall amount of built floor space has almostdoubled. However, almost all of the net growth in floor space has beenresidential. Although a good deal of new commercial space has been built overthe same time period, many commercial buildings sites have been demolished aswell, so that the total amount of commercial floor space is virtually unchanged

from twenty-five years ago.

2.5 OTHER GEOGRAPHICAL / CONTEXTUAL FACTORS

Columbia Streets historic/heritage area represents a considerablecompetitive advantage over other pedestrian-oriented retail precincts, inthat such a concentration of heritage commercial buildings cannot readilybe found elsewhere in the Lower Mainland, with the exception ofDowntown Vancouver.

Front Street poses a serious problem to retailers there because the trucktraffic, pollution, and shadow from the parkade makes it less pleasant forpatrons. Furthermore, the shops are not readily visible from Columbia, sothe shopper must actively seek out the shops on Front Street, whichseverely inhibits walk-in custom.

It is anticipated that a portion of the Front Street Parkade might beremoved in the foreseeable future, although the consultant is not aware ofany specific plans or timelines. Not only is the parkade severely under-

utilized (some estimates put usage at around 30% of capacity), but it actsas a considerable deterrent to Front Street patronage by trappingconsiderable amounts of air pollution, as well as amplifying the noise ofthe passing truck traffic and funnelling that sound up the street.

Larcos planned five-tower, 900-unit project on the riverfront willprobably not begin development for another ten years in light of marketconditions and the high costs involved in building next to the river, and


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will in all likelihood be built on a tower-by-tower phased basis. Ideally,the City should be able to extract assistance from the developer in order tonot only create a lengthy riverside seawall, but also a means of linkingthe riverfront with Columbia Street to the substantial benefit of bothparties.

A study examining the potential program for a new multi-use civic facilityis underway. The consultant understands that the facility is expected tohave meeting/event space for arts, non-profit, and corporate users thatcan hold up to 350 persons (event style). It is anticipated to also include acommunity centre and possibly museum. The location has not yet beendetermined, but it is hoped that the ultimate location will be decided insuch a way as to not only create the best facility possible, but also in sucha way as to be of greatest benefit to the Downtown as a whole if thelocation should ultimately be decided to be Downtown. It is the

consultants understanding that this facility is fully-funded, but because ofthe funding stipulations must be built quite quickly.

In the medium or longer term, there may be considerable reason toexamine the potential of relocating City Hall to a new buildingdowntown. At present, City Hall uses between 40,000 and 50,000 squarefeet, and maybe another 5,000 for the Parks department which is currentlyhoused in a different building an amount of space which could certainlybe readily accommodated in an alternate location Downtown.


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2.6 STUDY AREA DELINEATION

Different land uses have different study areas. For instance, office andhotel/conference uses will compete on a more regional level than would, forinstance, commercial service or certain retail uses. Although the latter certainlypossess some regional characteristics (for instance, some specialized comparisonretail stores may attract shoppers from throughout the metro area), a retailtrading area can be relatively more tightly delineated.

For that reason, the office and hotel study areas should be understood to includeNew Westminster, Burnaby, North Surrey (generally comprised of Whalley andGuildford), and a portion of southern Coquitlam. A map showing the boundariesof this study area can be found on Figure 1 later in the report when hotel andoffice uses are examined, along with a more in-depth description of the areadelineation.

In terms of commercial-retail land use, a trade area can be defined as theregion from which 85% to 95% of site sales will be generated. In this case, theretail trading area should be understood to comprise the City of NewWestminster, with two approximate trading zones within the study area.Although it is not possible to state definitively that this proportion of sales willbe generated from people who reside strictly within the limits of the City, it is theconsultants belief that the use of inflow sales is adequate to capture whateverretail trade does not originate from with the boundaries of the City of NewWestminster itself. Inflow sales are discussed in greater depth further below.

(The inverse phenomenon, outflow sales, occurs when trading area residentsexpenditures leave the trading area, resulting in study area market shares below100%. Such a circumstance is very common in suburban locations, althoughDowntown New Westminster can be characterized by an untowardly high levelof outflow sales, as a large portion of Downtown residents shopping is doneoutside of the Downtown.)

For the purposes of this report, the primary trading zone is made up of theDowntown, and the secondary trading area is comprised of the remainder of

New Westminster. Although the areas outside of the City are not included in thestudy area, it should be understood that the substantial competitive influencefrom outside of the study area is well-reflected in all analyses of land usemarketability for retail and retail-like uses.


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3.0 DEMOGRAPHIC & ECONOMIC OVERVIEW

This section includes forecasts of population growth, as well as variousdemographic analyses such as incomes, household structure, age structure, and

employment, particularly in the study area, but also outside of the study areawhere other considerations warrant expanding the geographic scope of thisanalysis.

3.1 POPULATION GROWTH

One of the key determinants of the strength of the downtown market is theactual downtown population, and accordingly the forecasted population levelsfor the Downtown and remainder of New Westminster factor heavily into all

projections of demand for retail and other commercial space.

The population forecasts used in this study are provided according to threedifferent scenarios of growth (low, base case, and high) in order to take intoaccount potential deviation of future population growth rates from the currenttrend. The projections are based on other studies not performed by theconsultant, namely the New Westminster Urban Development Forecast 2008 to2041 prepared for the City in November 2008.

The projections for all three scenarios can be found on Table 1.

3.2 DOWNTOWN POPULATION DEMOGRAPHICS

In order to gain more particular insight into the demographic makeup of theDowntown, three census tracts (see diagram on the following page) have beenisolated from the broader New Westminster statistical makeup, and compared tothe Metro Vancouver average.

This provides insight into the three following areas:

General Statistics (population, age, dwelling and household characteristics,income)

Household Statistics (mother tongue, immigration, mobility, andeducation)

Industry Statistics (labour force, industry, occupation, place of work, andmode of transportation)


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TABLE 1NEW WESTMINSTERPOPULATION PROJECTIONS - BASE CASE, LOW AND HIGH SCENARIOS

POPULATION - LOW SCENARIO 2006 2011 2016 2021 2026

Downtown 8,900 10,600 12,700 15,200 18,200New West Total 61,600 67,000 71,900 79,300 85,800Downtown as % of Total 14% 16% 17% 19% 21%

Note: All figures rounded to nearest 100.

POPULATION - BASE CASE 2006 2011 2016 2021 2026



POPULATION - HIGH SCENARIO 2006 2011 2016 2021 2026



Source: City of New Wesminster; Urbanics Consultants, Ltd.

Note: These projections assume that the downtown's proportion of the total population is consistent with thebase case.

Note: These projections assume that the downtown's proportion of the total population is consistent with the

base case.


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Note that the boundaries of these three census tracts do not exactly coincide withthe study area (that is to say, Tracts No.207 and No.206 fall exactly within theboundaries of the study area, but Tract No.202 encompasses some of the areafarther west of the Downtown and along the riverfront), as follows:

(Source: Statistics Canada)

However, although the use of these statistics distorts the findings somewhat byincluding some residents outside of the Downtown area, it would be inaccurateto exclude this tract altogether on account of the substantial concentration ofresidents along the riverfront. Furthermore, a very substantial portion of thecensus tracts residents live within the study area, and accordingly these threecensus tracts combined should be considered to offer the best approximation ofthe Downtowns demographic makeup.

The three broad statistical categories for the Downtown are discussed in turn:

DOWNTOWN


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TABLE 2DEMOGRAPHICS - CENSUS TRACTS 202, 206, 207, METRO VANCOUVERGENERAL STATISTICS (POPULATION, AGE, INCOME, ETC.)

Characteristics Census Tract 202 Census Tract 206 Census Tract 207Three Census

Tract TotalMetro Vancouver

Population and dwelling counts

Population in 2006 6,833 1,893 2,394 11,120 2,116,581

Population in 2001 6,047 1,793 2,145 9,985 1,986,965

2001 to 2006 population change (%) 13.0% 5.6% 11.6% 11.4% 6.5%

Total private dwellings 3,839 1,109 1,483 6,431 870,992

Private dwellings occupied by usual residents 3,539 1,035 1,366 5,940 817,033

Population density per square kilometre 5,258 6,126 6,990 5,703 736

Land area (square km) 1.30 0.31 0.34 1.95 2,877

Age characteristics

Total population 6,830 1,890 2,395 11,115 2,116,580

0 to 4 years 260 75 80 415 105,280

5 to 9 years 230 30 55 315 112,270

10 to 14 years 200 30 65 295 128,185

15 to 19 years 235 40 80 355 137,19020 to 24 years 445 175 215 835 148,515

25 to 29 years 540 230 290 1,060 143,300

30 to 34 years 585 210 240 1,035 146,410

35 to 39 years 580 210 255 1,045 165,640

40 to 44 years 600 185 220 1,005 182,145

45 to 49 years 645 180 240 1,065 178,250

50 to 54 years 570 170 185 925 160,130

55 to 59 years 560 135 160 855 139,650

60 to 64 years 400 95 115 610 98,140

65 to 69 years 290 55 45 390 76,575

70 to 74 years 240 30 60 330 64,570

75 to 79 years 230 25 50 305 54,185

80 to 84 years 135 20 25 180 40,650

85 years and over 95 5 20 120 35,480

Median age of the population 43 38 38 40 39

% of the population aged 19 and under 14% 9% 12% 12% 23%% of the population aged 20-64 72% 84% 80% 76% 64%

% of the population aged 65 and over 14% 7% 8% 12% 13%

Occupied private dwelling characteristics

Total private dwellings occupied by usual residents 3,540 1,035 1,365 5,940 817,230

Owned dwellings, % 67% 45% 43% 57% 65%

Rented dwellings, % 33% 55% 58% 43% 35%

% of dwellings constructed between 1986 and 2006 76% 44% 19% 58% 41%

Average value of owned dwelling ($) 275,498$ 205,439$ 227,370$ 236,102$ 520,937$

Selected household characteristics

Total private households 3,540 1,035 1,365 5,940 817,230

Average household size 1.9 1.7 1.8 1.8 2.6

Median income in 2005 - All private households ($) 53,389$ 46,490$ 44,907$ 48,262$ 55,231$

Median monthly payments for rented dwellings ($) 770$ 807$ 694$ 757$ 812$

Median monthly payments for owner-occupied dwell ings ($) 1 ,065$ 1,019$ 925$ 1,003$ 1,081$

Income in 2005

Persons 15 years and over with income (counts) 5,945 1,700 2,120 9,765 1,659,535

% in low income before tax - All persons 21.8% 23.9% 20.3% 22.0% 20.8%

Median income - Persons 15 years and over ($) 29,206$ 27,155$ 27,408$ 27,923$ 25,032$

Earnings - As a % of total income 77.6 88.3 81.3 82.4 78.0

Source: Statistics Canada, 2006 Ce nsus of Population.


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3.3 GENERAL STATISTICS

The following observations can be made:

Total population growth in the Downtown is almost double the metro-area average

There are far fewer (that is, half as many) young people in the Downtownas compared to the metro-area average (12% of people are aged 19 andunder as opposed to vs. 23% for the entire Metro Vancouver). Similarly,people aged 20-64 comprise a much higher proportion: 76% vs. 24%.

The homeownership rate is lower, at 57% versus 65% region-wide. The building stock is newer than the rest of the region, with almost 60% of

residential buildings Downtown having been built after 1986.

The household size of 1.8 is well below the regional average of 2.6 Median household incomes are considerably lower Downtown than the

Metro average: around $7,000 lower per household. That said, individualmedian incomes are approximately 11% higher than the region-wideaverage. This is a reflection of the much smaller household size.

A slightly larger proportion of residents are considered low-income (22%).Refer to Table 3 for further detail on these general statistics.

3.4 HOUSEHOLD STATISTICS


There is a much higher proportion of residents Downtown who speakEnglish only, as compared to the regional average.

There is a much higher degree of mobility of Downtown residents, withthe percentage moving into the area from another municipality over threetimes higher than the regional average.

There is a slightly higher degree of post-secondary educational attainmentfor Downtown residents

The two most significant fields of study are business, management andpublic administration; and architecture; engineering; and relatedtechnologies

Refer to Table 3 for further detail on these household statistics.


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TABLE 3DEMOGRAPHICS - CENSUS TRACTS 202, 206, 207, METRO VANCOUVERHOUSEHOLD STATISTICS



Mother tongue


English only 4,430 1,320 1,810 7,560 1,190,555

French only 160 30 50 240 24,135

English and French - 15 - 15 2,850

Other language(s) 2,240 500 535 3,275 880,420

English only as a percentage of the total 65% 71% 76% 68% 57%

Immigrant status and period of immigration


Non-immigrants 4,435 1,225 1,760 7,420 1,227,495

Immigrants 2,320 585 615 3,520 831,265

Before 1991 910 225 320 1,455 388,740

1991 to 2000 910 225 205 1,340 290,830

2001 to 2006 505 130 85 720 151,690

Non-permanent residents 75 60 20 155 39,205

Mobility status - Place of residence 1 year agoTotal population 1 year and over 6,780 1,835 2,385 11,000 2,076,590

Lived at the same address 1 year ago 5,245 1,310 1,780 8,335 1,724,425Lived within the same province 1 year ago; but changed 500 220 190 910 191,935

addresses within the same municipality

Lived within the same province 1 year ago; but changed 790 275 350 1,415 90,485

addresses from another municipality in the same province

Lived in a different province 1 year ago 160 15 50 225 22,030

Lived in a different country 1 year ago 90 10 10 110 47,710

Total population 5 years and over 6,570 1,775 2,310 10,655 1,992,495

Lived at the same address 5 years ago 2,660 580 935 4,175 1,043,415Lived within the same province 5 year ago; but changed 1,265 265 425 1,955 482,670

addresses within the same municipality

Lived within the same province 5 year ago; but changed 1,840 755 665 3,260 240,040

addresses from another municipality in the same province

Lived in a different province 5 years ago 335 60 190 585 60,680

Lived in a different country 5 years ago 465 115 90 670 165,685Moved to Downtown from another municipality in past year 12% 15% 15% 13% 4%

Educational attainment


No certificate; diploma or degree 785 285 295 1,365 303,345

High school certificate or equivalent 1,640 430 650 2,720 473,315

Apprenticeship or trades certificate or diploma 530 185 285 1,000 150,045

College; CEGEP or other non-university certificate or diploma 1,235 335 450 2,020 282,780

University certificate or diploma below the bachelor level 435 120 135 690 110,945

University certificate; diploma or degree 1,510 375 380 2,265 431,955

No postsecondary certificate; diploma or degree, % of total 39% 41% 43% 41% 44%

Postsecondary certificate; diploma or degree, % ot total 61% 59% 57% 59% 56%

Major field of study


No postsecondary certificate; diploma or degree 2,425 715 945 4,085 776,660

Business; management and public administration 825 220 245 1,290 216,595

Architecture; engineering; and related technologies 715 245 300 1,260 194,485

Health; parks; recreation and fitness 515 105 130 750 124,305

Social and behavioural sciences and law 460 80 120 660 112,705Education 370 45 70 485 66,075

Humanities 240 80 65 385 64,080

Mathematics; computer and information sciences 160 130 75 365 45,770

Personal; protective and transportation services 125 10 140 275 44,580

Visual and performing arts; and communications technologies 135 55 80 270 50,565

Physical and life sciences and technologies 90 40 15 145 41,210

Agriculture; natural resources and conservation 50 - 10 60 15,185

Other 20 - - 20 170

Source: Statistics Canada, 2006 Census of Population.


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3.5 INDUSTRY STATISTICS


The Downtown employment participation rate and employment rate arehigher than the region-wide average, and unemployment rate is lowerthan the regional average.

The two most important occupational sectors are:o Sales and service occupationso Business, finance, and administration occupations

The most important industry category by far is business services, followeddistantly by manufacturing, health care and social services, retail trade,and then educational services.

The number of workers working outside of their municipality of residenceis very significant, with only 13% of Downtown residents employedwithin the City of New Westminster. Although data on employmentwithin the Downtown is not available, it is the consultants consideredopinion that the number of Downtown residents who also workDowntown is very small.

The percentage of workers using other modes of transportation to theiremployment (that is, not as the driver of a private vehicle) is substantiallyhigher than the regional average, with almost half of all employees usingalternate modes or as a secondary passenger in a private vehicle.

Furthermore, the number of Downtown residents using public transit toget to their employment is considerably higher (more than double) thanthe region-wide average, with over a third of all workplace-destined tripsmade with public transit.

Median household incomes are considerably lower Downtown than theMetro average: around $7,000 lower per household. That said, individualmedian incomes are approximately 11% higher than the region-wideaverage. This is a reflection of the much smaller household size.

A slightly larger proportion of residents are considered low-income (22%). Earnings constitute a higher percentage of incomes than the regional

average (that is, pensions, investments, and other non-earnings sourcesare less significant for Downtown New Westminster residents as a meansof generating income).

Refer to Table 4 for further detail on these industry statistics.


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TABLE 4DEMOGRAPHICS - CENSUS TRACTS 202, 206, 207, METRO VANCOUVERINDUSTRY AND EMPLOYMENT STATISTICS



Labour force activity


In the labour force 4,265 1,250 1,680 7,195 1,169,725

Employed 4,060 1,185 1,620 6,865 1,104,760

Unemployed 205 65 60 330 64,960

Not in the labour force 1,880 485 515 2,880 582,665

Participation rate 69.5% 72.0% 76.5% 72.7% 66.8%

Employment rate 66.1% 68.3% 73.8% 69.4% 63.0%

Unemployment rate 4.8% 5.2% 3.6% 4.5% 5.6%

Occupation

Total experienced labour force 15 years and over 4,220 1,205 1,645 7,070 1,150,490

G Sales and service occupations 1,025 265 480 1,770 291,545

B Business; finance and administration occupations 710 275 285 1,270 219,415

H T ra des; t ransport and equipme nt operators and related occupations 450 170 315 935 148,810

A Management occupations 565 110 125 800 130,375

E Occ upa tion s in soc ia l sc ie nce ; e du ca tion; go ve rn me nt s erv ice , r el ig ion 5 05 65 135 705 98,845

C Natural and applied sciences and related occupations 365 165 100 630 85,070J Occupations unique to processing; manufacturing and utilities 220 45 60 325 45,840

D Health occupations 225 50 45 320 62,450

F Occupations in art; culture; recreation and sport 125 35 80 240 47,600

I Occupations unique to primary industry 30 15 20 65 20,545

Industry

Total experienced labour force 15 years and over 4,220 1,205 1,645 7,070 1,150,490

Business services 1,040 275 455 1,770 271,120

Manufacturing 425 105 170 700 97,800

Health care and social services 450 90 130 670 107,065

Retail trade 380 130 130 640 124,965

Educational services 325 55 135 515 83,200

Construction 240 65 145 450 73,385

Finance and real estate 260 90 70 420 85,220

Wholesale trade 210 75 60 345 61,650

Agriculture and other resource-based industries 55 40 15 110 23,970

Other services 840 275 330 1,445 222,110

Place of work status

Total employed labour force 15 years and over 4,065 1,185 1,620 6,870 1,104,760

Worked in a different municipality in the regional district 2,690 785 1,070 4,545 478,420

No fixed workplace address 600 145 275 1,020 135,850

Worked in municipality of residence 540 185 195 920 373,880

Worked at home 180 55 65 300 91,595

Worked in a different regional district 15 10 10 35 11,640

Worked in a different province 20 - 10 30 3,230

Worked outside Canada 15 - - 15 10,140

Worked in municipality of residence as % of Total 13% 16% 12% 13% 34%

Mode of transportation to work

Total employed labour force with a usual place of work 3,865 1,130 1,560 6,555 1,003,025

Car; truck; van; as driver 2,230 455 795 3,480 675,080

All other modes, as % of total 42% 59% 49% 47% 33%

Car; truck; van; as passenger 190 20 50 260 70,985

Public transit 1,220 530 625 2,375 165,435

Walked or bicycled 190 85 65 340 80,000All other modes 25 35 20 80 11,520

Public transit, as % of total 32% 47% 40% 36% 16%

Income in 2005

Persons 15 years and over with income (counts) 5,945 1,700 2,120 9,765 1,659,535

% in low income before tax - All persons 21.8% 23.9% 20.3% 22.0% 20.8%

Median income - Persons 15 years and over ($) 29,206$ 27,155$ 27,408$ 27,923$ 25,032$

Earnings - As a % of total income 77.6 88.3 81.3 82.4 78.0

Source: Statistics Canada, 2006 Census of Population.


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3.6 ECONOMIC OUTLOOK UNCERTAINTY

It must be emphasized that, given the current economic conditions and uncertainoutlook for economic growth, both within the Metro Vancouver region, as wellas provincially, nationally, and internationally, there is considerable potential for

the substantial deviation from the consultants findings, especially in the first oneor even two five-year increments of the study period.

In the long-run, however, the potential for deviation is much lower as the overalleconomic growth prospects for the city and region in the long-term remain quitehealthy.


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4.0 RETAIL MARKET ANALYSIS

This section of the report provides a category-by-category analysis ofretail/commercial market opportunities for the Downtown subject area. The

market share analysis and expenditure potentials presented in this section forman integral step in the identification of the most viable project components for thesubject area.

However, it must be borne in mind that over such an extensive study period,market shares and expenditure potential could vary considerably from thatforecasted, and that such an analysis is intended not to provide specificindications of the exact amount of retail space to be absorbed over each period,but rather a general indication of the relative strength of various retail categoriessuch that their absorption can be prioritized according to theme and location

such that the optimum configuration is achieved.

4.1 RETAIL TRADE AREA DELINEATION:

This section identifies the primary and secondary trade areas, where relevant,from which the majority of retail and service commercial customers are likely tobe derived. As noted in the Study Area Delineation, the retail trading area canbe more tightly circumscribed as compared to the other land uses underconsideration. The retail trade area can be said to represent the area from whichapproximately 90% of all retail sales will be derived. The consultant believes that

the City of New Westminster itself will generally comprise the total trading area,which is further comprised of two sub-zones: the primary and the secondarytrading zones.

The Primary Zone is made up of the on-site population in the Downtown studyarea, and the Secondary Trading Zone is comprised of the remainder of thepopulation of New Westminster. All other sales are anticipated to be inflowsales, that is, to account for spending in the study area by residents outside of thetrading area. In the case of Downtown New Westminster, this would likely comein the form of employees who work in New Westminster but who do not live in

New Westminster, students from outside of the city, and visitors.


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4.2 RETAIL SUPPLY

Generally speaking, there are three major retail-commercial areas within NewWestminster (including the Downtown) and a further four major retail-commercial areas situated outside of New Westminster in the New

Westminster/Coquitlam/Burnaby area that should be considered competitivesupply:

Downtown New Westminster

Over and above the street-level retail along Columbia Street, the two of the mostconcentrated areas of retail activity in the Downtown are the Columbia Squareshopping mall at Columbia Street and Royal Avenue and the soon-to-be-builtPlaza 88 transit-oriented retail development:

Columbia Square is a 20-year-old 175,000 square foot shopping plaza atthe far west end of the Downtown, and is anchored by a 20,000 square footIGA.

Plaza 88 will contain as much as 170,000 square feet of transit-orientedretail, including a 37,500-square-foot grocery store, a 17,500-square-footdrugstore and an 11,600-square-foot liquor store. The consultant is not yetaware of the specific nature of the remaining 100,000 square feet, and socannot comment on the remainder of the supply in this new precinct.

It should be noted, however, that this Downtown retail supply, especially the

new retail space coming onto the market over the next few years at Plaza 88,should not be seen as a threat to other Downtown retailers. Even though thesestores will likely compete directly with certain other downtown retailers, thisnew supply will help to create a much stronger critical mass of retail, and thusremove the incentive for shoppers to leave Downtown altogether to fulfill themajority of their retail needs. The net result should be that more people opt to domost of their shopping downtown, resulting in higher overall sales for the entireprecinct.

Uptown New Westminster

This commercial area, centered on the corner of 6th Street and 6th Avenue, wasinitially anchored by a Woodwards department store, which has since becomethe Royal City Centre shopping mall. The neighbourhood also includes theWestminster Centre, a four-storey office and retail complex home to nationalretailers and commercial services including London Drugs, TD Canada Trust,VanCity, BCAA, Starbucks, and McDonald's. The upper floors contain officespace. Save-On-Foods will open a new store at Westminster Centre in the


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summer of 2009. The area also includes the New Westminster Public Library, on6th Avenue.

Queensborough Landing

Queensborough Landing is an agglomeration of large-format and national chainstores in the centre of Queensborough, including a Wal-Mart, Best Buy, HomeOutfitters, Petcetera, numerous fashion chains, restaurants, and a fewindependent stores. Not far from this shopping area is the recently-relocatedcasino.

Lougheed Town Centre

Located in Burnaby, BC at the northwest corner of Austin Ave. and North Rd.,Lougheed Town Centre is considered to be Burnaby's second premiere Regional

Shopping Centre and attracts over 7 million shoppers per year. Opened inSeptember 1969, this 600,000 sq. ft. shopping centre has 175 stores and servicesand is anchored by a 125,400 sq. ft. The Bay, a 136,300 sq. ft. Wal-Mart, a 30,000sq. ft. Safeway, and a 35,000 sq. ft. London Drugs Store.

Retail and commercial services that can be found in the Lougheed Town Centreinclude apparel, jewelry & gifts, shoes& bags, home furnishing & house wares,electronics, and books; specialty food & chocolate, cards & stationery; fast foodoutlets and restaurant; bank & financial services, beauty salon, medical &professional services, and travel services.

United Boulevard / Lougheed Highway

Located along Lougheed Highway and along United Boulevard in Coquitlam,this is one of the largest concentrations of warehouse-format and other big-boxretailers, including a particularly heavy concentration of furniture and homefurnishings, automotive, and other major national chains (for instance, RealCanadian Superstore, Home Depot, and IKEA, among others).

Metrotown

Metropolis at Metrotown is a powerful and dynamic shopping andentertainment complex, which is the second largest in Canada. A retailpowerhouse in the trade area, the complex features an unparalleled mix of largeand small format retailers, with 470 quality and brand name stores spread over1.7 million sq. ft. of GLA. This formidable retail destination benefits from highannual traffic flows approaching 25 million vehicles per year, direct Skytrain andtransit access, and abundant free parking. Ideally situated in the heart of Metro


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Vancouver, the Metrotown node has an expansive trade area of over 1.7 millionpeople and draws from all parts of the Lower Mainland.

Big Bend

With a total of over 600,000 square feet of retail space, the two power retailingcentres in Burnabys Big Bend area (Big Bend Crossing and Marine WayMarket), at the intersection of Marine Way and Byrne Road, include majornational big-box tenants such as RONA, Winners/HomeSense, Michaels,PetSmart, Staples, Canadian Tire, London Drugs, PriceSmart Foods, and avariety of national and local restaurant tenants and CRUs.

The presence of Big Bend within a few minutes drive of Downtown NewWestminster is one of the strongest competitive threats to the health of theDowntown, given the ease and rapid access to and from the retail space here for

Downtown residents, especially those living along the riverfront west of theQuay.

Although the large-format stores in the Big Bend area will certainly have somenegative impact on Downtown retailers, there is also an opportunity to provide acontrast between the homogeneous, large-format suburban-type retail supply atBig Bend, and the potential for small-scale, fine-grained, unique local retailDowntown, and to create an environment that is much more attractive incomparison to the other new-format/big-box precincts. As well, the socialmanifestation of shopping can be an attractive draw for the Downtown, as

people spend more time and money if they can be offered an environmentconducive to leisure, relaxation, and a social experience (unlike big boxes). Theimportance of these dynamics is discussed in greater depth later in this study.


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4.3 RETAIL DEMAND ANAYSIS

This is an assessment of retail and commercial service opportunities, derivedprimarily from a forecast of population growth and real increases in per capitaexpenditures. Additionally, in view of the uncertainty in the market andeconomic environment, a variety of scenarios is employed in order to account fora range of likely market shares that the proposed project might be able to capture.

This key component of the retail element of the study identifies the local percapital average expenditures for different types of retail and commercial serviceactivity. In particular, these per capita retail expenditures are adjusted to reflectboth income and related demographic considerations.

4.4 TRADE AREA PER CAPITA EXPENDITURES

Using Statistics Canadas Retail Trade Survey Catalogue for the four most recentquarters for which data is available, the consultant has compiled relevantprovincial averages of per capita expenditures for a select number of retail andcommercial categories, as seen in Table 5. This includes all department store-typemerchandise categories, as well as food and grocery, liquor/beer/wine, andeating and drinking. Automotive and auto-related expenditures are not included.

Table 6 provides an index for the trade area based on mean income for NewWestminster as compared to B.C. as a whole, from which the per capita

expenditures for the trade area can be estimated. Because of the lower meanincome of New Westminster, a 5% discount from the provincial spendingaverage has been applied. This results in a total estimated $8,169 per capita forretail trade, and a further $1,452 per capita on eating and drinking. Of the retailtrade figure, the consultant has broken the total into two categories for thepurpose of this analysis: convenience retail and comparison retail.

For purposes of this analysis, convenience retail includes supermarket,convenience and specialty food stores, pharmacy and personal care, andbeer/wine/liquor stores.

For purposes of this analysis, comparison retail includes all non-conveniencestore types, such as furniture and home furnishings, electronics and appliances,home centres and hardware, building materials and garden stores, clothingstores, shoe and accessory, general merchandise, sporting goods, hobby, music,book stores, and miscellaneous retailers. This does not include auto dealerships,auto parts and service, or service stations.


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TABLE 6NEW WESTMINSTER PER CAPITA RETAIL EXPENDITURES

Per Capita Income

(1)

BC New WestminsterAverage Per Capita Income (2006) 35,834$ 33,625$

Per Capita Expenditure Adjustment Relative to Province 0% -5%

Retail Trade Category(2) BC New Westminster

Furniture stores 339$ 322$

Home furnishings stores 275$ 261$

Home electronics and appliance stores 59$ 56$

Home electronics and appliance stores 583$ 554$

Home centres and hardware stores 686$ 651$Specialized building materials and garden stores 221$ 210$

Supermarkets 2,100$ 1,995$

Convenience and specialty food stores 246$ 234$

Beer, wine and liquor stores 374$ 355$Pharmacies and personal care stores 577$ 548$Clothing stores 602$ 572$

Shoe, clothing accessories and jewellery stores 201$ 191$

General merchandise stores 1,622$ 1,541$

Sporting goods, hobby, music and book stores 379$ 360$

Miscellaneous store retailers 336$ 319$

Total Retail Trade Expenditures 8,599$ 8,169$

Convenience Shopping (3) 3,296$ 3,131$

Comparison Shopping (4) 5,303$ 5,037$

Eating and Drinking BC New Westminster

Full Service Restaurant 783.00$ 743.90$Limited Service Restaurant 633.30$ 601.60$

Drinking Places 159.50$ 151.50$

Special Food Services and Other 141.60$ 134.50$

Total Eating and Drinking Expenditures 1,717.40$ 1,631.50$

Sources:

1. BC Stats - Community Profiles

2. Previous table

Notes:

4. For purposes of this analysis, comparison retail includes all non-convenience store types, such as furniture and home

furnishings, electronics and appliances, home centres and hardware, building materials and garden stores, clothing

stores, shoe and accessory, general merchandise, sporting goods, hobby, music, book stores, and miscellaneous retailers.

Does not include auto dealerships, auto parts and service, or service stations.

3. For purposes of this analysis, convenience retail includes supermarket, convenience and specialty food stores,

pharmacy and personal care, and beer/wine/liquor stores.


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It should be noted that this is a somewhat crude distinction, given that manyitems sold at a store in the convenience category in fact exhibit comparisonqualities (e.g. a specific wine, health care product, or specialty food all of whichwould be sold in a convenience-type store under this classification), while theconverse is true of many items sold at comparison-type stores that in fact

exhibit more convenience-oriented qualities. There is also the problem ofvarious store types in one category offering merchandise that falls under that ofthe other category. For instance, many grocery stores also sell house-ware items,and conversely, many general merchandisers sell grocery items. On the whole,though, such exceptions as noted above are in the minority, and that said,observations based on these categorizations should generally be considered quitereliable, given the data sets available.

The above per capita expenditure estimates will be examined, along with thepreviously presented trade area population figures, to project the total retail

expenditure potential in the subject area. These in turn will form the basis ofsubsequent market opportunity assessments, on a category-by-category basis.

The total expenditure potential of the Downtown population base is multipliedby the per capita expenditures for this category in order to determine the totalspending potential of the study area. This is then multiplied by the share of thespending in this category by the study area (that is, any number less than 100%means that a certain portion of the populations spending is undertaken outsideof the study area.)

Furthermore, a secondary zone made up of the remainder of New Westminsterwould also be expected to spend a portion of their retail spending in theDowntown, albeit at a smaller share than the on-site residents. Accordingly, theirtotal expenditure potential (per capita spending multiplied by trading zonepopulation for each expenditure category) is multiplied by an anticipated shareof spending to arrive at the projected secondary zone spending amount.

A further amount of inflow spending is added to account for spending in thestudy area by residents outside of the trading area. As noted above, in the case ofDowntown New Westminster, this would likely come in the form of employeeswho work in New Westminster but who do not live in the city, students fromoutside of the city, and visitors. The increases in inflow assumptions usedthroughout this analysis are predicated on assumptions of increasing attractionand destination-ness of the Downtown, and rely on the understanding that notonly will improvements to waterfront accessibility readily come to fruition, butthat the Downtown will experience an expansion and improvement in its urbanmerchandising mix (that is, not just retail, but also eating and drinking, arts andculture, and employment).


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CONVENIENCE SHOPPING

As is shown on Table 7, average annual per capita convenience retailexpenditures have been estimated using per capita retail trade data, adjusteddownward slightly to reflect the slightly lower average household incomes of the

study area population. Further, per capita expenditures have been adjustedupward by a factor of 1% per annum (as per the medium scenario) to account forreal increases in average per capita spending levels commensurate withpresumed increases in average per capita incomes.

In light of the presence of very strong competitive retail facilities outside of theDowntown as detailed above, the consultant has applied relatively conservativesite market shares with market shares rising over the course of the study periodto reflect a broader and deeper array of offerings in this merchandise category.This is true both of the primary and secondary trading zones.

Under the medium-case scenario, starting at 40% and 15% of the primary andsecondary trading zones, respectively, in 2011, the study areas market share isexpected to rise to 55% and 25%, respectively, by the end of the study period.After accounting for anticipated inflow sales, this translates into an estimatedstudy area expenditure level totalling $44 million by 2011, rising to as much as$114 million by 2026. All dollar values are expressed in 2006 dollar value terms.

At an assumed productivity level of $350 per square foot a year, the mediumscenario indicates demand for convenience retail space of around 125,000 square

feet in 2011, rising to 240,000 square feet by 2026.

Although a large portion of this demand would be met by the existing facilitiesin Columbia Square and the eventual transit village around New WestminsterStation, there is still potential for further incremental additions of convenience-type retail, especially in the form of, for instance, specialty food shops, and otherunmet imported grocery or wine/beer/spirit niche stores.


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TABLE 7CONVENIENCE SHOPPING - MARKET DEMAND

2006 2011 2016 2021 2026

Primary Zone - Downtown

Population(1)

- Low Scenario 8,900 10,600 12,700 15,200 18,200

Population(1)

- Medium Scenario 8,900 10,600 12,600 15,400 18,400

Population (1) - High Scenario 8,900 10,600 12,700 15,800 19,300

Per Capita Expenditures (2) - Low Scenario 3,131$ 3,250$ 3,374$ 3,503$ 3,636$

Per Capita Expenditures - Medium Scenario 3,131$ 3,291$ 3,459$ 3,635$ 3,821$

Per Capita Expenditures(2)

- High Scenario 3,131$ 3,373$ 3,634$ 3,915$ 4,217$

Expenditure Potential - Low Scenario 27,868,570$ 34,455,283$ 42,852,775$ 53,240,741$ 66,175,489$

Expenditure Potential - Medium Scenario 27,868,570$ 34,884,894$ 43,582,181$ 55,984,268$ 70,302,372$

Expenditure Potential - High Scenario 27,868,570$ 35,756,974$ 46,151,819$ 61,854,656$ 81,395,957$

Market Share of Primary Zone Spending - Low 35% 40% 42% 45%

Market Share of Primary Zone Spending - Base 40% 45% 50% 55%

Market Share of Primary Zone Spending - High 45% 50% 55% 60%

Projected Sales Volume - Low Scenario 12,059,349$ 17,141,110$ 22,361,111$ 29,778,970$

Projected Sales Volume - Medium Scenario 13,953,958$ 19,611,981$ 27,992,134$ 38,666,304$

Projected Sales Volume - High Scenario 16,090,638$ 23,075,909$ 34,020,061$ 48,837,574$

Secondary Zone - New West Non-Downtown

Population (1) - Low Scenario 52,700 56,400 59,200 64,100 67,600Population (1) - Medium Scenario 52,700 56,400 59,200 64,100 67,600

Population(1)

- High Scenario 52,700 56,500 60,400 66,800 71,900

Per Capita Expenditures (2) - Low Scenario 3,131$ 3,250$ 3,374$ 3,503$ 3,636$


- Medium Scenario 3,131$ 3,291$ 3,459$ 3,635$ 3,821$

Per Capita Expenditures (2) - High Scenario 3,131$ 3,373$ 3,634$ 3,915$ 4,217$




Market Share of Secondary Zone Spending - Low 10% 10% 13% 15%

Market Share of Secondary Zone Spending - Base 15% 17% 20% 25%

Market Share of Secondary Zone Spending - High 15% 20% 25% 30%




INFLOW SALES LEVEL: 5% 7.5% 10% 10%

Inflow Sales Volume - Low Scenario 1,519,608$ 2,783,743$ 5,154,895$ 6,664,817$

Inflow Sales Volume - Medium Scenario 2,089,803$ 4,081,679$ 7,459,722$ 10,323,750$

Inflow Sales Volume - High Scenario 2,233,968$ 5,023,099$ 9,939,808$ 13,980,704$

TOTAL PROJECTED SITE SALES VOLUME:

Total Sales Volume - Low Scenario 31,911,768$ 39,900,320$ 56,703,841$ 73,312,989$

Total Sales Volume - Medium Scenario 43,885,855$ 58,504,063$ 82,056,942$ 113,561,255$

Total Sales Volume - High Scenario 46,913,318$ 71,997,746$ 109,337,892$ 153,787,749$

ESTIMATED PER SQ.FT. PRODUCTIVITY: (4) 350$ 386$ 427$ 471$

TOTAL WARRANTED FLOORSPACE (SQ.FT.):

LOW SCENARIO 91,000 103,000 133,000 156,000

MEDIUM SCENARIO 125,000 151,000 192,000 241,000HIGH SCENARIO 134,000 186,000 256,000 326,000

Notes:

1. See tables of per capita retail spending by category

2. Assumed real per capita expenditure per annum increases of 0.75% for low, 1% for medium, and 1.5% high scenarios, respectively.

4. Productivity assumed to grow at a nominal 2% per annum.

Source: Urbanics Consultants Ltd.

3. For purposes of this analysis, convenience retail includes supermarket, convenience and specialty food stores, pharmacy and personal care, and

beer/wine/liquor stores.


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COMPARISON SHOPPING

As is shown on Table 8, average annual per capita comparison retailexpenditures have been estimated using per capita retail trade data, adjusteddownward slightly to reflect the slightly lower average household incomes of the

study area population. Further, per capita expenditures have been adjustedupward by a factor of 1% per annum (as per the medium scenario) to account forreal increases in average per capita spending levels commensurate withpresumed increases in average per capita incomes.

In light of the presence of very strong competitive retail facilities outside of theDowntown as detailed above, the consultant has applied relatively conservativesite market shares albeit rising over the course of the study period to reflect abroader and deeper array of offerings in this merchandise category. This is trueboth of the primary and secondary trading zones.

Under the medium scenario, starting at 20% and 10% of the primary andsecondary trading zones, respectively, in 2011, the study areas market share isexpected to rise to 35% and 20%, respectively, by the end of the study period.After accounting for anticipated inflow sales, this translates into an estimatedstudy area expenditure level totalling $45 million by 2011, rising to as much as$142 million by 2026. All dollar values are expressed in 2006 dollar value terms.

At an assumed productivity level of $300 per square foot a year, the mediumscenario indicates demand for comparison retail space of around 130,000 square

feet by 2011, rising to 300,000 square feet by 2026.

Although a large portion of this demand would be met by certain existing retailfacilities along Columbia Street and in certain pre-existing retail areas (e.g.Columbia Square), there is still considerable potential for further additions ofcomparison-type retail throughout the Downtown in a wide variety ofmerchandise categories especially local shops of a specialty character. (Theelements of merchandising concepts are discussed later in the report.)


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TABLE 8COMPARISON SHOPPING - MARKET DEMAND

2006 2011 2016 2021 2026


Population (1) - Low Scenario 8,900 10,600 12,700 15,200 18,200

Population(1)

- Medium Scenario 8,900 10,600 12,600 15,400 18,400

Population (1) - High Scenario 8,900 10,600 12,700 15,800 19,300


- Low Scenario 5,037$ 5,229$ 5,428$ 5,635$ 5,849$


- Medium Scenario 5,037$ 5,294$ 5,564$ 5,848$ 6,146$


- High Scenario 5,037$ 5,426$ 5,846$ 6,298$ 6,784$




Market Share of Primary Zone Spending - Low 15% 17% 20% 25%

Market Share of Primary Zone Spending - Base 20% 25% 30% 35%

Market Share of Primary Zone Spending - High 25% 30% 35% 40%




Secondary Zone - New West Non-Downtown

Population(1)

- Low Scenario 52,700 56,400 59,200 64,100 67,600

Population (1) - Medium Scenario 52,700 56,400 59,200 64,100 67,600

Population(1)

- High Scenario 52,700 56,500 60,400 66,800 71,900


- Low Scenario 5,037$ 5,229$ 5,428$ 5,635$ 5,849$



- High Scenario 5,037$ 5,426$ 5,846$ 6,298$ 6,784$










INFLOW SALES LEVEL: 10% 12% 15% 15%








ESTIMATED PER SQ.FT. PRODUCTIVITY:(4)

350$ 386$ 427$ 471$


LOW SCENARIO 72,000 99,000 144,000 210,000

MEDIUM SCENARIO 129,000 194,000 275,000 300,000

HIGH SCENARIO 190,000 269,000 377,000 426,000

Notes:


2. Assumed real per capita expenditure per annum increases of 0 .75% for low, 1% for medium, and 1.5% high scenarios, respectively.

4. Productivity assumed to grow at a nominal 2% per annum.


3. For purposes of this analysis, comparison retail includes all non-convenience store types, such as furniture and home furnishings, electronics andappliances, home centres and hardware, building materials and garden stores, clothing stores, shoe and accessory, general merchandise, sporting

goods, hobby, music, book stores, and miscellaneous retailers. Does not include auto dealerships, auto parts and service, or service stations.


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EATING AND DRINKING

The eating & drinking category refers to all purchases made in restaurants, bothfull-service and limited-service/fast-food. As is shown on Table 9, averageannual per capita eating and drinking retail expenditures have been estimated

using per capita retail trade data, adjusted downward slightly to reflect theslightly lower average household incomes of the study area population. Further,per capita expenditures have been adjusted upward by a factor of 1% per annum(as per the medium scenario) to account for real increases in average per capitaspending levels commensurate with presumed increases in incomes.

In light of the presence of competitive retail facilities outside of the Downtown(albeit not quite to the same degree as evidenced in other retail categories), theconsultant has applied conservative market shares rising fairly rapidly over thecourse of the study period to reflect a broader and deeper array of restaurant and

caf offerings especially if the riverfront can be made more accessible, if astronger retail cluster develops in the Downtown, and if the downtownemployment base grows in accordance with the recommendations containedherein. Again, site market shares are expected to be relatively higher, as on-siteworkers, shoppers, and residents elect to visit restaurants and cafs in closerproximity, rather than traveling uptown or elsewhere. This rise in anticipatedmarket shares should be true both of the primary and secondary trading zones.

According to the medium attraction scenario, market shares by 2011 might startat 25% and 15% of the primary and secondary trading zones, respectively, and

the study areas market share would be expected to rise to 40% and 35%,respectively, by the end of the study period. After accounting for anticipatedinflow sales, this translates into an estimated study area expenditure leveltotalling $24 million by 2011, rising to as much as $75 million by 2026. All dollarvalues are expressed in 2006 dollar value terms. At an assumed productivitylevel of $350 per square foot a year, the medium scenario indicates demand foreating and drinking retail space of around 68,000 square feet by 2011, rising to158,000 square feet by 2026.

Although the precise nature of this restaurant space cannot be determined at thistime, the most important consideration is that of diversity. An ideal circumstancewould include a variety of eating and drinking options at different price pointsand serving different market segments (family, pub, ethnic, contemporary, etc.)with both independent and chain operators. Accordingly, all recruitment effortsshould focus on attracting establishments that fill currently unmet market niches.It should also be emphasized that this new supply need not necessarily be indirect competition with the existing supply, since the creation of more criticalmass is of benefit to all establishments in this category.


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TABLE 9

EATING AND DRINKING - MARKET DEMAND2006 2011 2016 2021 2026


Population(1)

- Low Scenario 8,900 10,600 12,700 15,200 18,200

Population(1)

- Medium Scenario 8,900 10,600 12,600 15,400 18,400

Population(1)

- High Scenario 8,900 10,600 12,700 15,800 19,300


- Low Scenario 1,632$ 1,694$ 1,758$ 1,825$ 1,894$



- High Scenario 1,632$ 1,758$ 1,893$ 2,040$ 2,197$




Market Share of Primary Zone Spending 15% 20% 25% 30%






Secondary Zone - New West Non-DowntownPopulation

(1)- Low Scenario 52,700 56,400 59,200 64,100 67,600

Population 1 - Medium Scenario 52,700 56,400 59,200 64,100 67,600

Population(1)

- High Scenario 52,700 56,500 60,400 66,800 71,900


- Low Scenario 1,632$ 1,694$ 1,758$ 1,825$ 1,894$


- Medium Scenario 1,632$ 1,715$ 1,802$ 1,894$ 1,991$


- High Scenario 1,632$ 1,758$ 1,893$ 2,040$ 2,197$










INFLOW SALES LEVEL: 25% 30% 35% 35%








ESTIMATED PER SQ.FT. PRODUCTIVITY: 350$ 386$ 427$ 471$


LOW SCENARIO 44,000 57,000 77,000 85,000

MEDIUM SCENARIO 68,000 95,000 128,000 158,000

HIGH SCENARIO 91,000 124,000 192,000 242,000

Notes:


2. Assumed real per capita expenditure per annum increases of 0.75% for low, 1% for medium, and 1.5% high scenarios, respectively.3. Productivity assumed to grow at a nominal 2% per annum.



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SERVICE COMMERCIAL

These facilities generally include barber shops, hair stylists, day spa and beautyparlour, dry-cleaning services, laundromats, etc. but exclude financial services,insurance, real estate, travel agency, video rental, and the like. The consultant has

derived the per capita expenditure figure for service-commercial transactionsbased on the Statistics Canada Survey of Household Spending for BC, whichindicate per capita expenditures should amount to approximately $250 for 2006.This amount is adjusted upward over the course of the study period by assumingan annual real increase in these expenditures of 1% per annum (as per themedium scenario) commensurate with presumed increases in average per capitaincomes.

Because service commercial is generally of a local-serving orientation as opposedto regional, the consultant has applied much more aggressive market shares than

was the case with other retail categories, and rising over the course of the studyperiod to reflect a broader and deeper array of offerings in this commercialcategory. This is true both of the primary and secondary trading zones, as notonly should the increased depth and breadth attract business from throughoutthe trading area, but the presence of a considerable Downtown employment basewould also help to bring in inflow spending in this category.

Under the medium scenario, starting at 45% and 25% of the primary andsecondary trading zones, respectively, in 2011, the study areas market share isexpected to rise to 70% and 35%, respectively, by the end of the study period.

After accounting for anticipated inflow sales, this translates into an estimatedstudy area expenditure level totaling $6.4 million by 2011, rising to as much as$15 million by 2026. All dollar values are expressed in 2006 dollar value terms.

At an assumed productivity leve

downtown new west market study_09

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