Considering the unprecedented rise of e-commerce options, coupled with the worse provincial recession in decades, one might think that retail sales have plummeted. However, there’s recent data from the Retail Council of Canada that suggests shopping malls have weathered the storm quite well.
Southgate Centre, West Edmonton Mall, Kingsway Mall, Edmonton City Centre and Londonderry Shopping Centre make up the top regional malls in Edmonton. The first three in that group release information on how productive the stores are on average. Using metric of “sales per square foot”, the shopping malls provide an indication on what the average revenue for every square foot of sales space. For simple math, if a mall was 100,000 square feet, and all the stores combined did $50M in yearly sales, the sales per square foot would be $500 ($50M / 100,000).
In 2016, the sales per square foot for the malls were as follows:
Southgate Centre: $1,155 (made it the 5th most productive mall in all of Canada);
West Edmonton Mall: $745 for non-anchor CRU’s and $1,175 for the main corridor;
Kingway Mall: $704
In 2017, the sales per square foot on Southgate and Kingsway saw a modest decline:
Southgate Centre: $1,147 (maintaining its top 5 ranking in Canada);
Kingway Mall: $689
Interestingly, West Edmonton Mall saw a small increase with $760 for non-anchor CRU’s and $1,178 for the main corridor. Rec Room, which has a successful location already in South Edmonton Common, just opened a second Edmonton location in West Edmonton Mall.
Londonderry Mall in north Edmonton will also be an interesting mall to follow. They recently completed an extensive renovation and added another anchor tenant with La Maison Simons (~ 100,000 square feet).
In short, malls have performed quite well through the recession. We’ve also seen oil prices start rising towards $70 / barrel (WTI:$USD), so that should be a positive for the market as a whole. While there are always external pressures, we are optimist that 2018 will be a good year for the economy.
Chad GriffithsSIOR, CCIM
Chad is a partner with NAI Commercial Real Estate and focuses on the Greater Edmonton area. Chad entered the industry in 2004 and has completed over 400 commercial transactions with clients ranging from small, local companies to large institutional owners. Chad has been a top 15 producer Canada-wide since 2013.
Ryan BrownBCom, SIOR
Ryan is a partner with NAI Commercial Real Estate in Edmonton. He is currently ranked nationally as one of NAI's top advisors in Canada. Having executed in excess of $100 Million dollars worth of sales transactions and over 2 Million square feet of lease transactions, Ryan has developed a firm understanding of asset evaluation and an aptitude for building design, functionality, and practicality for long term use.
Darcie is a licensed Commercial Real Estate Agent in the Province of Alberta with a focus on the Edmonton market and its surrounding areas. Darcie accomplishes custom solutions for her clients through her personable nature and results driven attitude. Darcie can help if you are looking to invest in commercial real estate or are looking for representation for a sale or lease transactions.
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