In Downtown D.C., Office Is King. Can The Area’s Economy Survive A Pandemic?

When tourists think of downtown D.C. they think of some of the country’s most famous landmarks: the Lincoln Memorial, the Washington Monument, the White House. But when commercial real estate professionals think of this area of our nation’s capital, there’s one thing that comes to mind: office space.

More than 75% of the built space in Downtown D.C. is office space, compared to the 6.6% of buildings in the area that are classified as residential. As of October, just 10% of D.C.’s office worker population had returned to those buildings, a major blow to office owners and managers and the local retail and restaurant industry, which relies primarily on office workers to drum up business. 

"Businesses have been severely impacted by the pandemic, and the area is seeing 10% to 20% of the revenue it was seeing this time last year,” Downtown D.C. Business Improvement District President Neil Albert said. 

How can an area so reliant on the office market survive a pandemic that has 95% percent of local office workers working from home? Through a combination of grants and outdoor dining and by making a push to digital.

Grants, Outdoor Dining Help D.C. Small Businesses Stay Afloat 

Albert said that on any given day pre-pandemic, Downtown D.C. saw a daytime population of close to 236,000. When those workers and visitors started staying home, local business owners turned to the government for grants they could use to keep their businesses alive. These grants include $33M in small-business grants from the D.C. government as well as Paycheck Protection Program loans from the federal government. 

Recently, the D.C. government began offering grants to restaurants that are looking to winterize their outdoor patio space to keep outdoor dining going year-round. Money from these grants can be used to purchase tents, heaters, propane, lighting, furniture and advertising for local restaurants. 

Meanwhile, Albert said that the BID has been helping restaurants access public spaces where they can expand their outdoor seating capacity. In September, the organization launched Dine Out on 8th Street, which helped transform parts of Eighth Street Northwest into a “streatery” during the weekends, using temporary lane and road closures to allow local restaurants to have more well-ventilated, safe dining options.

The BID has also been working with the city and the Restaurant Association of Metropolitan Washington to procure outdoor gas heaters to give to restaurants that want to continue to offer outdoor seating in the winter. 

“We’re also very proud of how we’ve been able to continue to serve our most vulnerable populations during this time,” Albert said. “The BID runs a drop-in center for people experiencing homelessness and we had to close its doors due to the pandemic. But now, we are serving meals to those who need them seven days a week, right on the sidewalk.”

In The Golden Triangle, Businesses Pivot Online 

The Golden Triangle area — the western part of D.C.'s central business district, spanning the blocks around Farragut Square up to Dupont Circle — is almost entirely retail and office space. Leona Agouridis, the executive director of the Golden Triangle Business Improvement District, said that since the start of the pandemic, local eateries and retail businesses have been struggling without the office worker population they usually cater to. 

In response, the BID has been tackling issues on two fronts: supporting local businesses that have lost their usual customer base and working on a plan to welcome office workers back to the area once the pandemic is under greater control.

“In the last few months, we’ve focused on two main themes: go online and go outdoors,” Agourdis said. 

She said that early in the pandemic, the BID noticed that businesses with a strong online presence were faring better than others, and creating that presence was easier for some than others. The organization realized the best way they could help these businesses was to create a program called Small Business Online, which featured webinars that local shop owners could watch on topics like search engine optimization and social media tips. The BID also hired a digital marketing firm to provide 10 long-standing local businesses with up to 25 hours of technical support. 

The organization also distributed 340 PPE care packages to Golden Triangle businesses authorized to open in Phase 1 of ReOpen D.C., and it helped to set up 12 temporary pickup and delivery zones for 13 neighborhood restaurants to help them adapt to online and to-go ordering.

“There’s always been so much foot traffic in this area, and once it was gone, lunch spots that were used to having lines down the block suddenly had to deal with the fact that they had no delivery options or e-commerce on their websites to reach their customers,” Agourdis said. 

Now, she said that through Small Business Online those businesses have gotten the help they need to connect with clients online and keep their operations running until office workers return. 

As the holidays approach, the BID is launching an Instagram campaign called the #GiveThanksGiveaway, which will be five days of giveaways, from Nov. 16 through Nov. 20, where people can win a selection of items from participating BID businesses by engaging with Instagram posts. The goal is to encourage people to continue to shop locally when they go online for their holiday shopping.  

As COVID-19 cases continue to rise, it seems as though it will be some time before office workers are ready to return to Downtown D.C.’s offices in force. But when they do, the Golden Triangle BID intends to be ready for them. The BID plans to spend the next new months talking to office building tenants to find out when they plan to have workers return. Then, the organization is aiming to put out a series of webinars focused on what building owners have been doing to help keep tenants safe when they finally come back to the Golden Triangle.