Innovations are impelling much of this recovery from years of less-than-desirable performance
Brick and mortar retail continues to thrive in major Canadian markets despite intensified competition from online retailers along with decelerating growth in overall sales and traffic.
A new study by the Retail Council of Canada (covering the mall sector in 2019) indicated that contrary to fears of e-commerce forcing retail spaces into irrelevance, “shopping centre owners are listening carefully to consumers’ desire for easier access, more simplicity, greater convenience and fabulous shopping experiences.”
This has led to a renaissance of sorts for physical store locations.
“Not only are Canada’s top malls continuing to make substantial capital investments to meet consumers’ hunger for retail innovation, enterprising landlords are also looking at unprecedented ways to add value and expand productivity, through impressive mall renovations and increasingly with easily accessible and integrated ‘live, work, play and shop’ developments,” Retail Council president and CEO Diane Brisebois said.
The increasing prominence of mixed-use complexes in Canada’s urban markets is expected to continue providing a significant boost to the retail asset class.
“Landlords are not only investing in superb shopping spaces, they are increasingly also adding more non-retail amenities such as destination entertainment attractions, food markets and restaurants, fitness centres, parks, offices and residential towers that are transforming their shopping centres in all-encompassing community hubs,” the Council’s report explained.
As of the end of June 2019, 11 shopping centres nationwide had their annual average sales per square foot figure exceed $1,000. This year, the figure could increase to as much as 14 centres across Canada.
Spending from out-of-town visitors fuelled much of the activity in the top three performing centres.
“Vancouver/Lower Mainland has more shopping centres per capita ranking among the top 30 most productive malls in Canada,” the report noted, adding that “for the fourth year in a row, Toronto’s Yorkdale Shopping Centre ranked as the most productive shopping centre in Canada with annual sales per square foot of $1,964.”
