It will take three-to-five years for Alexandria to economically work its way out of the pandemic, according to the Alexandria Economic Development Partnership (AEDP).
That’s according to a recently released Alexandria State Of The Market 2021 Mid-year Report, in which AEDP outlined business trends and impacts.
“The hardest-hit industries continue to be tourism, restaurants, and retail, and the use of office buildings and mass transit, and attendance at live entertainment venues remain low,” the report said. “The onset of COVID-19 in 2020 not only created new trends but also accelerated those that were already underway and hastened the demise of others. That said, it is expected cities will bounce back in three to five years, largely due to the appeal and vitality of entertainment, finance, technology, and education.”
AEDP President and CEO Stephanie Landrum says that business owners have been through the worst days of the pandemic.
“We made temporary things permanent, like the closure of streets, the ability for businesses to use sidewalks,” Landrum said. “The things that we were scrambling to do last year when these first surges happened, we’ve learned how to do all of them and we’ve made them all permanent. We’re in a much better place as a community and as businesses to get through this next surge.”
AEDP has distributed millions in Back To Business grants to businesses all over the city, and has been a hub for relief-related information. The nonprofit has also been central to bringing major business development to the city, including Amazon’s HQ2 and the Virginia Tech Innovation Campus.
“I don’t think anyone was prepared for the level of uncertainty and the length of this pandemic,” Landrum said.
The city has experienced a dramatic drop-off in hotel occupancy and revenues. Mayor Justin Wilson noted in a social media post that hotel revenue fell from $1.1 million in July 2019 to around $200,000 in July 2020, and Landrum believes that hotels emptied by the pandemic could be converted into affordable housing.
More people are also working from home, and the city’s office vacancy rate increased to 15.9% (as of June 2021) over 13.1% in 2020.
The report outlined the following rising trends:
- Suburban Migration
- Safety/Health Concerns for Indoor Public Spaces
- Affordable Housing Crisis
- Demand for Public Open Space
- Retail Sector Transformation
- Concerns about Racial Equity
- Federal Deficit
- Use of Bikes and Scooters
- Worker Shortages
The report outlined these slowing trends:
- Appeal of Cities and Density
- In-Person Meetings/ Conferences/Business Travel
- Experiential Retail
- Growth of Health/Wellness Establishments
- Tourist-Oriented Retail/Leisure Travel/Tourism ö Mass Transit Use
- Apartment Amenity Wars
- Live Entertainment/Movie Theaters
Retail investments may never fully return to pre-pandemic performance, the report said.
“Typical storefront retail will lose value as customer foot traffic counts decline over an increasing preference toward online purchases and home deliveries,” the report said. “Consumers may forever shift to e-commerce shopping for most apparel, food, and household items.”
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