American retailers eye larger slice of Calgary market
Vacancy rate at a low 2.5%
By Mario Toneguzzi August 11, 2011 5:02 PM
CALGARY — Waves of American retailers are looking for opportunities to expand beyond their overly-competitive domestic market with Canada, and Calgary, their obvious destinations in the future, says a retail report by Barclay Street Real Estate Ltd.
Besides giant discount retailer Target’s entry into the Canadian marketplace in 2013, other retailers looking to expand here include Kohl’s, Marshalls, J. Crew, Express, Zumiez, Intermix and J.C. Penney.
“Consumers in Calgary seem to remain resilient and optimistic in the current economy,” said Ellisa Asaria, associate, retail leasing for Barclay Street. “The demand for retail space in the city is outstripping supply and this is leading to low vacancy rates and high competition for prime locations.”
The Barclay Street report said Calgary’s retail vacancy rate is only 2.5 per cent and it is anticipated that the market will experience tight vacancies in the foreseeable future until more developments come on stream.
“With a limited amount of retail space available in the market, landowners are considering this to be an opportunity to develop land for new retail locations,” said Asaria. “There are some exciting new retail locations that will be ready in the near future.
“While there are a number of new retail developments across the city, we see the market remaining tight due to above average Alberta incomes and increased interest by foreign retailers in Canadian spaces. With the upbeat market, U.S. retailers are seeing this as an opportunity to expand to the Canadian market. Retailers in both the food and consumer goods spaces are actively seeking to enter the under-serviced Canadian market. In the short-term, there are expansion plans by discount stores like Dollar Tree and U.S. food retailers like PF Chang’s. In the medium term, we will see new American-style outlet centres with high-end retailers.”
According to the Conference Board of Canada, Calgary had the highest average annual retail sales growth in the country from 2001-2010 at 6.8 per cent. Last year, retail sales grew by 5.6 per cent from the previous year, reaching $21.6 billion.
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