COVID-19, rising taxes threaten beloved urban village
Commercial Drive is one of Vancouver’s most beloved urban villages, but its small businesses have taken a hit due to the combined weight of the COVID-19 pandemic and soaring taxes.
Tino’s Barber & Stylist, Mark’s Pet Stop, The Flowerbox, the Storm Crow Tavern, Cabrito — Tapas Bebidas, and Federico’s Supper Club are some of the businesses that have succumbed to various factors that are putting the unique, independent flavour of the neighbourhood at risk.
“Devastating. Heartbreaking,” is how Federico Fuoco describes the loss of his business after 20 years on The Drive. The heartbreak is real: Last week, the 58-year-old had a stent put in. “The stress has been unbelievable,” he said.
Fuoco grew up making music alongside his father, Gianni. Gianni, 90, a legend in Vancouver’s Italian community, was the inspiration for Fuoco to bring back the concept of the old-school supper club, with the family onstage every night making music while diners danced and celebrated. Federico’s opened in 1999 and quickly became a hit — the place to celebrate birthdays, anniversaries, communions, as popular with old-school community members as it was with hipsters.
“No matter who was here, there was no generation gap, whether it was a 15th birthday or a 50th anniversary,” said Fuoco. “By the end of the night everyone was on the dance floor and partying together. It was magical.”
Margins were always tight, but for 20 years Fuoco was able to make it work. Like many small-business owners, Fuoco sank under the weight of a triple-net lease: He was responsible for rent, property taxes, water, sewer, garbage collection and insurance — all costs that have skyrocketed.
When the building was sold three years ago, the new landlord demanded a 100 per cent rent increase, said Fuoco. An arbitration reduced the amount to 40 per cent.
“I asked for rent relief from the landlord or more time to make those payments and he said not a day, not a minute, not a penny, zero,” said Fuoco.
In 2020, Fuoco was clubbed with a seven per cent property tax increase, and the pandemic. He was in an impossible situation: “There was no way I could move forward.”
Telling his customers and staff who had worked with him for decades was difficult, but delivering the news to his dad was gut-wrenching.
“My father said to me, ‘Federico, I’m 90 years old. It’s the one thing I look forward to — to come and sing at the restaurant,’” Fuoco said.
Because the restaurant had already closed for the pandemic, there were no goodbyes. So Fuoco made a video and posted it on Facebook.
“Everybody is struggling,” said Nick Pogor, executive director of the Commercial Drive Business Society. “It’s been a slow push over the edge for the last three to five years for small businesses.”
Pogor said the problem is systemic: “The city draws three-quarters of its revenue from its property taxes and doesn’t understand the issues small business face. It’s been a year after year of a systemic burden that everybody is carrying.”
Property taxes are based on “highest and best use” of space, leaving many small businesses and property owners paying taxes on the property’s potential — airspace above them that’s not even built — rather than its actual use.
The mood on The Drive, says Pogor, is “stressful.”
Closures required by the pandemic gave a final push over the edge to businesses with small margins.
“We are looking for support from the three levels of government, whether it’s reduced taxes or parking revenue sharing,” said Pogor.
Storm Crow Tavern on Commercial closed its doors soon after the COVID-19 lockdown was announced.
The cosy pub’s marketing officer, Jessica Langer, describes the former watering hole as “by nerds, for nerds.” It opened on Commercial seven years ago, and quickly became a local hangout, offering trivia and live Dungeons & Dragons nights, board games and a familial elbow-to-elbow experience.
Langer calls the decision to close “heartbreaking,” attributing it to “a confluence of factors.” Their lease was close to expiring, but the pandemic seemed to have no expiry
date. They didn’t have a patio.
“Unlike some of the larger restaurants, it wasn’t going to be possible to enact social distancing inside the tavern,” said Langer.
When they posted their announcement on Facebook, more than1,000 people commented in an outpouring of affection and solidarity.
“We were a community,” said Langer.
The Storm Crow Alehouse in Vancouver’s Kitsilano neighbourhood remains operational.
Cabrito Tapas also closed its doors in March. Owner Alexandre Carriére said his 36-seat restaurant felt like being in his own living room. He supported small breweries, offered live entertainment, met his life partner there, and
“loved every minute” of his time as chef and owner.
Carriére cites rent, taxes and municipal over-regulation as factors that made it impossible to carry on. Part of what made it impossible to do business was that, like other Vancouver restaurants, he had to pay retail prices for the liquor he sold.
“People with power and money are making the decisions,” said Carriére.
By the time the pandemic hit, he had already sold the business. “I’d cried enough,” Carriére said. He’s not disheartened, though: He plans to take his unique skills and create a restaurant somewhere else.
It just won’t be in Vancouver.