Famed retailers racing to calgary's red
Calgary's booming economy, a young population and high levels of disposable income have some international retailers looking at this marketplace some overlooking toronto and vancouver as their first entry point into canada.
A record low vacancy rate and pent up demand is fuelling massive retail development in the city, with about one million square feet currently under construction and another 6.6 million square feet proposed for the city.
Within the next year to three years, calgarians can expect to spend their dollars at a number of new retail giants which will set up shop here for the first time including louis vuitton, tiffany, gucci and apple.
"The massive retail projects are reacting to the pent up demand,"Said darryl schmidt, director of leasing in calgary for cadillac fairview corp.Ltd., during the Buildex Calgary conference Tuesday.
"There's far too much retail demand for the inventory in michael kors sale uk the market today. "
The overall retail vacancy rate in calgary is currently 1.3 per cent a record low in an inventory of just michael kors crossbody bags sloan under 31 million square feet of development throughout the city.
"This is exceptionally low,"Said schmidt, adding that streetfront retail is also at a 1.33 per cent vacancy level.
"It's dramatically below what we would consider equilibrium in the marketplace. "
So far this year, a total of 856, 900 square feet have been added to the inventory.There is another 987, 677 square feet currently under construction in 10 different projects, which will increase the inventory by 5.8 per cent, added Schmidt.
And there are 23 projects proposed, representing 6, 651, 653 square feet, which would increase michael kors crossbody bags weston the total inventory in the next 24 to 36 months by 21 per cent, he said.
"We still are underserviced on a retail per square foot per capita basis,"Said schmidt.
The development is being pushed forward by continuing strong sales.Recently, michael kors hobo a report by kubas consultants said retail sales in the calgary area are forecast to break the $23 billion mark this year and the $25 billion level in 2008 recording among the highest annual percentage growth rates in the country.
The report said retail sales in the calgary census metropolitan area will grow by 9.9 per cent this year to $23.2 billion while next year the growth is forecast to be 9.6 per cent to $25.5 billion.In 2006, retail sales in the calgary cma were $21.2 billion.
The burgeoning sales numbers will push the calgary cma to capture 5.6 per cent of all Canadian sales this year and 5.9 per cent in 2008.
The economic boom in alberta and the resultant high migration numbers to the province are the biggest factors in the growing retail sales numbers for calgary, said ed strapagiel, executive vice president of kubas consultants.
"It really comes down to the economy,"He said. "Even though the retail outlook for calgary seems to be down from last year in terms of growth(16.2 per cent in 2006), it's really partly because last year was white hot and we're merely slowing down to red hot. "
Schmidt said calgarians can expect a great influx of top rate retailers within the next three years, including pottery barn kids, abercrombie and fitch, coach, michael kors, hollister co., Whole Foods, Lacoste, Bass Pro Shops, Cabela's, Aldo Collection, Urban Outfitters and many others.
"It's very bullish.Right now we're getting retailers that are contemplating making their first entry into canada, calgary,"Said schmidt. "That's never occurred before. "
Traditionally, it's been toronto or vancouver, but schmidt said he's got three or four retailers interested in making calgary their first entry point into canada.
The commercial real estate industry is finally seeing some relief from the basically zero per cent vacancy rate recently experienced in the downtown office market, with the rate now in the two per cent range, said chris howard, vice president of aspen properties ltd., at the Tuesday conference.
By 2011, howard said the downtown office market vacancy rate could be in the nine per cent range, factoring in all the new construction.
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