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The impact of COVID-19 on Australia’s CBD’s - featured image

The impact of COVID-19 on Australia’s CBD’s

Australia is one of the most urbanised countries in the world with our main central business districts (CBDs) at the heart of economic, political, recreational, cultural and innovation activity.

The influx of CBD-based workers, visitors and new residents, have been key in maintaining their role as centres for activity and employment. melbourne-city-park-happy-peace-victoria-garden-300x185

However, since COVID-19 there has been a profound shift in purchasing and visitation behaviours of Australians.

Our CBD’s have borne the brunt of social distancing requirements, trading restrictions, job losses and large numbers of office-based workers working from home, with most CBD workers and shoppers typically travelling from middle and outer suburbs.

NAB have recently produced a consumer insight report showing the impact of Covid on Australia CBD's and what would encourage us to visit the CBDs more often.

NAB data shows that spending in our CBD’s is recovering with Perth having the strongest rebound.

Melbourne continues to be most impacted (particularly, accommodation and cafes & restaurants), but most other capitals are also still feeling the effects of COVID in some sectors.

In contrast, the suburbs have grown in importance as hubs for retail and recreational activity in metropolitan Australia.

Revitalising CBDs is vital for the livelihoods of the many CBD businesses, particularly small businesses, that rely on foot traffic.

Cities cannot remain economically sound without the businesses that typically make urban centres their home base.

While converting some office space into residential is an option, commercial space supports ground-level retail and hospitality businesses.

Vibrancy requires a mix of commercial, residential, government, and cultural buildings with small and bigger businesses co-existing together.

In their NAB Consumer Insight Report, the bank explored the extent to which consumers have changed visitation to their capital city CBD and if so, why are they visiting less often, what (outside of returning to work) would encourage them to return, and the importance to Australians of having thriving and vibrant CBD’s.

Large numbers of Australians have either stopped visiting their CBD altogether or are visiting much less often.

In the absence of having to go into the city to work, many consumers see no reason to visit, although younger people remain much more engaged with their CBD’s. Inducements such as free or subsidised car parking and public transport, dining/shopping vouchers, along with better safety and cleanliness, fewer cars and more green spaces, “pocket parks”, festivals, events, entertainment, and attractions, would help.

But, with many Australians hoping to continue to work at least partly from home in the future, the legacy impacts of COVID are likely to endure. Many people have also made greater use of their local areas since COVID and these behaviours have become ingrained and may require a broader reimagining of city centres and public spaces to re-engage consumers.

why are you not visiting the CBD


  • Around 6 in 10 Australians have either stopped visiting their CBD or are visiting less - almost 1 in 5 have stopped visiting altogether (even higher for the over 50s);
  • Melbourne has been most impacted (over 7 in 10 people have stopped or are visiting less), followed by Sydney. Darwin is the least impacted but 29% are still visiting less. Hobart and Perth also down (44% overall); city family urban suburb
  • Top reasons Australians have stopped visiting/or visiting less often: 1 in 2 have no reason to do so (particularly the over 50s); 1 in 3 due to social distancing/fear of COVID, prefer to shop/eat locally; 1 in 4 expensive parking, not wanting to use public transport; and 1 in 5 too many closed shops/cafes/restaurants, working from home, lack of life/vibrancy.
  • What would encourage us to visit our CBD more often (other than work)?: free/subsidised car parking (30% - ranging from 51% in the ACT to 26% in NSW) or public transport (21%), more security/better safety (13%); more major festivals (13%), dining/shopping vouchers (13%), more open green spaces/pedestrian walkways/fewer cars (12%), more COVID-safe alfresco dining options (11%), cleaner public spaces/streets (11%), more live music/entertainment (10%) and major theatrical events and attractions (10%).
  • But, over 1 in 4 (26%) consumers said nothing would encourage them to visit the CBD more often (highest in QLD 31% & SA 30%; lowest in the ACT 17%). Almost 1 in 2 (46%) consumers over 65 said nothing would make them visit more frequently, compared to just 12% in the 18-29 and 17% in the 30-49 group.
  • Overall, a thriving/vibrant CBD is moderately important to Australian consumers: 63.1 pts out of a possible 100, but very important for 1 in 5 (19%) consumers (i.e. scored 90 pts or higher).
  • By state, it’s most important in TAS & the ACT and least important in WA. By age it is highest in the 18-29 group (very important for 1 in 4 or 23%), lowest for over 65s.

why are you not visiting the CBD

Source: NAB Consumer Insights Report

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About Kate Forbes is a National Director at Metropole assisting our high net worth clients safely grow, protect and pass on their wealth. She has 25 years of investment experience in financial markets on two continents, is qualified in multiple disciplines, and is also a Chartered Financial Analyst (CFA).
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