Ongoing expansion in our Saskatoon commercial retail sector has resulted in the overall supply exceeding demand.
Our 3Q19 retail market update reports the average vacancy rate has edged up to 4.6 per cent.
Let’s look at where that expansion is taking place and the market locations where the most interesting vacancy story can be told.
Under construction
We have close to 100,000 square feet (SF) of new retail development currently under construction.
The inventory in Hampton Village recently increased by 160,325 SF with the tenant mix including Tim Hortons, The Canadian Brewhouse and Dairy Queen.
The city’s second Keg restaurant opened in Brighton Market which is comprised of a total of 235,000 SF.
About fifty percent of 45,000 SF within Meadows Market Phase 2 has been leased.
Interesting sub-market facts
It’s interesting to observe how the 20th Street corridor has transitioned in recent years to become the hip place to set up shop for merchants.
It boasts one of the lowest vacancy rates in the city at 2.2 per cent, while still offering attractive average net rental rates of $13.50 and occupancy costs of $5.00.
Another bright spot is Stonebridge with only 1.9 per cent vacancy where landlords are commanding rental rates on average $29.00 net plus $11.53 occupancy costs.
Three sub-markets where absorption of space has slowed include 8th Street, 22nd Street and Downtown where vacancy rates are 7.5 per cent, 7.0 per cent and 5.7 per cent respectively.
The latest on enclosed mall redevelopment
Cineplex’s new seven-screen 30,000 SF theatre has recently opened. This came about as a result of the departure of Rainbow Cinemas where 20,000 SF of retail space has been freed up for the spring of 2020.
There has been some recent unsettling news about Mountain Equipment Coop’s financial struggles. Only time will tell if those struggles will impact their spring 2020 expansion into the Saskatoon market at Midtown Plaza.
Redevelopment of the downtown Sears vacancy is progressing with the relocation of Shoppers Drug Mart complete in 15,000 SF and the rebranded Midtown Common Food Court in 42,000 SF on the 2nd level.
Contact me if you’re interested in obtaining a copy of our 3Q19 retail, industrial or office market reports.
Posted by Barry Stuart
