Cape Town Central Business (Image: Ryan Warneke, attached)

  • Downtown Cape Town, like most central business districts, has been severely affected by the Covid-19 pandemic and related restrictions.
  • In 2020 alone, there are more than 100 retail businesses left in the city center.
  • The situation improved in 2021, with 135 businesses in the center of Cape Town, of which more than 27% are retail.
  • By the third quarter of 2022, Cape Town had recovered almost 98% of its retail business, and a full return to pre-pandemic levels is expected by the end of the year.
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Cape Town’s inner city is recovering from the challenges caused by the pandemic, with retail expected to return to 2019 levels by the end of the year.

Central business districts (CBDs) around the world have been severely affected by Covid-19, with offices closed as staff work from home and entertainment venues closed due to social distancing restrictions. Hotels struggled to fill rooms due to the travel ban, while shops and sit-down restaurants saw a drop in attendance as customers opted for online shopping and takeout.

The Cape Town Central Improvement District (CCID), which covers 1.6kmĀ² and stretches from Buitensingel to Nelson Mandela Boulevard and from Buitengracht to Canterbury Street, has not spared.

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More than 100 downtown retailers closed in 2020. The number of active businesses across all sectors fell by more than 14%, with retail trade the biggest cause, joined by financial institutions, tourism and housing, architecture and advertising as other worst hit.

Vacant office space in central Cape Town has risen to almost 15%.

Despite repeated waves of infections and fluctuating lockdown levels in 2021, Cape Town’s inner city has improved. This recovery was detailed in the latest State of Cape Town Central City Report (SCCR) published by the CCID on Wednesday.

In total, in 2021, CBD acquired 135 businesses, of which more than 27% are retail. The return of cafes, coffee shops, mobile shops, kiosks, hair salons, restaurants, bars and takeaways are some of the major factors contributing to this recovery in the retail segment.

Although it was around 6% below pre-pandemic levels at the end of 2021, the city’s retail segment is expected to fully recover by the end of 2022, according to Sandra Gordon, SCCR Research Economist , which presented more recent data, until the third quarter of 2022, on the recovery of retail trade.

By the end of the third quarter, a total of 1,208 retail businesses were operating in Cape Town’s city centre, representing a recovery of almost 98% from 2019 levels.

“We’re pretty confident we’ll be back to 2019 levels by the end of this year,” Gordon said at the launch of the latest SCCR.

“Looking at retail, pubs, clubs and cafes… you can see the hit they’ve taken with Covid, but now they’re close to their pre-Covid levels and since I created this chart about a week ago, I I know of at least one more restaurant and one more coffee shop that has opened, so we’re slowly but steadily getting back to our pre-Covid levels.”

And while retail has recovered quickly in central Cape Town, other business segments are lagging behind.

At the end of 2021, real estate, real estate and education businesses declined, while ICT and telecommunications remained flat. Gordon suggests that in many cases, work in these segments has moved to the Internet for good.

The growth of retail has not extended to fuller offices. The downtown office vacancy rate rose to 16.1% — slightly higher than the national average — at the end of 2021, “which has forced downtown landlords and real estate developers to rethink the pandemic office landscape and repurpose vacant space.”

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