A year ago, it seemed Canada was the apple to every retailer’s eye. American retail giant Target Corp. had announced a widely-anticipated cross-country launch and upscale chain Nordstrom was flashing major Canadian expansion deals.
Fast forward to 2014 and it appears interest is already dwindling for big-name retailers to launch onto what was once fertile Canadian retail grounds.
The hesitation for other retailers can likely be attributed to the shortcomings of Target’s first year — mismanaged inventory issues creating some bare shelves and perceived costly prices allowing the rest to overflow. As well, Nordstrom is balking at its original plans to launch its discount chain Rack, pushing the date to 2017.
But it’s the lack of real estate in major shopping hubs that makes it most difficult for retailers to set up shop in Canada.
Ross Moore, Director of Research for CBRE Ltd., said in a report Monday, “While Canada remains an appealing destination for global retailers, our competitors are catching up and Canada has had to relinquish our unusually large share of the spotlight.”
“One reason for the decrease in new retailers coming to Canada is that there is little to no vacancy in highly sought after shopping centres and high street locations. It is only natural for there to be a pause while developers and supply chains adjust to the influx of brands from years past,” explained Moore on behalf of the commercial real estate company.
Although Canada toppled off the list of the Top 20 cities to attract new retailers, falling from its number six slot based on 2013’s poll, “Canada still ranks highly in terms of the variety of global retailers that are present in cities across the country,” the report said.
So while new businesses haven’t been attracted to the country, what retailers that do exist are quickly focusing on expansion.
“The retailers that entered Canada with a limited number of stores have been busy expanding their footprint across the country,” Moore noted in the report. “No longer satisfied with a single location, usually in Toronto, we have seen retailers pursue opportunities in Vancouver, Calgary and Montreal. As a result, most Canadian cities had their rankings improve in terms of overall retailer representation.”
For Vancouver this includes the recently revealed Roots flagship store expansion and L’Occitane relocating to the large vacated Bebe space. It will also add on to the recent openings of De Beers and Tory Burch on Alberni Street.
Featured Image: Cadillac Fairview