Bellingham report shows 14% downtown vacancy rate

Ground floor commercial space in the downtown pedestrian core is approximately 14% vacant.

Community and Economic Development Manager Tara Sundin presented the downtown vacancy report to the Bellingham City Council Community and Economic Development Committee on Monday, April 27, 2026. The report, which used data from a field survey conducted in October 2025, analyzed 1,935,582 square feet of ground-floor space.

The findings showed a total of 193,239 square feet of vacant ground-floor space across the broader study area, representing a 10% vacancy rate. However, the rate increased to 14% within the retail focus area and required ground-floor commercial zone.

The report identified 13 properties classified as stalled, having remained vacant for more than 5 years. Reasons for extended vacancies included legacy environmental issues and ownership models. A property at 102 W Champion Street has remained empty for more than 10 years due to underground tanks and a chemical plume.

The report also noted:

• Approximately 50% of the vacant properties are considered market-ready
• 3 vacant properties exceed 10,000 square feet
• 13 bank branches are located downtown
• Factors including surface parking lots and low-density lots contribute to a perceived lack of vibrancy

Potential strategies discussed to address the vacancies included the creation of a technical work group to convert large properties into smaller spaces and the possible implementation of a vacancy tax. The mayor identified changing state law to allow for a vacancy tax as a lobbying priority.

Periodic downtown vacancy rates over the past few years are as follows.

The Bellingham City Council is scheduled to continue discussions regarding the report during its meeting on May 11, 2026.