Nfld. & Labrador

A tale of two cities: St. John's business owner 'startled' by easy money in Halifax

Amidst a rash of shuttered St. John's businesses, one owner says his new Halifax location — thanks to similar rental fees and way more revenue — is booming.

Venue operator says Halifax value-for-money makes earning a profit at new location a relative breeze

Jack Axes owner Adrian Beaton is the latest in a string of people to suggest St. John's landlords are overvaluing downtown properties. (Jeremy Eaton/CBC)

The rent is comparable, but according to one venue operator, that's the lone similarity between two iterations of the same business: one in downtown St. John's, and the other occupying a prime spot on a busy street in downtown Halifax.

Owner Adrian Beaton said in the newest instalment of axe-throwing venue Jack Axes took just a month to reach the same level of monthly revenue the St. John's location was pulling in after four months.

That's not unbelievable given the population difference, but the real shock, he says, was the similarity of expenses.

"Don't get me wrong, I'm paying slightly more in rent in Halifax than I am in St. John's," he said. "But the difference in what I'm getting for that is a little bit startling."

Beaton said operating in Halifax is the "opposite" of St. John's, where he said he's contending with a space on the second floor of a 70-year-old building outfitted with aging bathrooms, a broken elevator and a rickety drop ceiling that's too costly to replace. 

All of that would be easy to stomach if St. John's had the same thriving downtown as Halifax — but clearly, it doesn't, he said.

In Halifax, by contrast, "everything economically is going quite well," he told CBC Radio host Ted Blades. "We're on the first floor of our building, the building is brand new, we have 20-foot windows in front of our place."

He says the experience of opening up shop in a city perhaps kinder to businesses is eye-opening, suggesting that St. John's venues aren't getting what they're paying for.

Beaton's Halifax spot costs just a little more than his St. John's lease. ( Robert Short/CBC)

"The problem," he says, "is that it's been overvalued for the space downtown. What we're paying made sense about 10 years ago, but things have changed down there.… Right now what people are paying in rent isn't indicative of what it should be. 

"The value isn't there."

Downtown downturn?

Beaton is one voice in a chorus of business owners piping up about their tribulations in a downtown core grappling with an apparent downturn.

CBC News recently reported that more than a quarter of downtown offices are sitting empty — a dramatic shift from six years ago.

Meanwhile, a rash of eateries, including Fixed cafe and Portobello's Restaurant, have announced that they're drowning in costs and can no longer stay afloat.

Bad Bones Ramen also left its Water Street location in December, citing high rent.

Late last year, following a number of nearby closures, Mochanopoly cafe owner Leon Chung implored St. John's residents to support downtown businesses.

He told CBC News that the area was "suffering," pointing to landlords, many of them absent, asking too much for spaces. He said many landlords aren't culturally invested in the neighbourhood, and aren't motivated to work out deals with tenants for the sake of the city's retail or restaurant scene.

Beaton agrees, and thinks the current climate could be more conducive to operators, suggesting more discussion between business owners, landlords and the city about solutions could give downtown a boost.

"It's kind of reached that point where I actually am not really able to understand what's going on," he said. "I'm hoping that it just reaches a point where it doesn't make sense for them not to lower rents.

"We have to be pretty close to that point."

Read more from CBC Newfoundland and Labrador 

With files from On the Go

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