If you’re looking to rent out a large amount of square footage in a mall or plaza in more than a few Canadian towns and cities, rarely has there been a more ripe opportunity.
Some would-be tenants are moving to do just that. Calloway, a big shopping centre owner, said Monday it’s in talks with a few potential suitors to have them take over leases held by Future Shop (which is being closed by parent Best Buy Canada).
The owner of 121 malls and plazas counts 19 Future Shops as current tenants, and while fewer than half of the locations are affected by the sudden decision to shutter dozens of locations across the country, Calloway joins other mall landlords suddenly with space to fill.
That fact becomes doubly true when you consider Target Canada is exiting all 133 locations the retailer operates across the country within weeks. Not to mention the litany of restructuring and bankruptcy filings among clothing retailers coming seemingly in waves.
MORE: Bootlegger, Cleo owner falters amid retail sector upheaval
Takers?
Big mall owners across the country are now angling to secure new tenants who can fill millions of square footage of retail space suddenly opening up.
But are there takers? Certainly mainstays like Loblaw and Walmart are being counted on to pick up some of the slack – indeed, both mega-retailers remain in expansion mode.
Others, like Canadian Tire, could pick up new large-format locations, too, but the general merchandiser would be extremely selective, experts say.
MORE: Get ready for more Walmarts, Canada
Yet given the now-crystallizing shift to e-commerce taking hold in Canada – where sales are expected to more than double (from $21.6 billion in 2013 to $44 billion by 2018, eMarketer says), some suddenly available locations could have a lot of trouble finding takers, experts say.
“Online retailers such as Amazon continue to grow their sales, and many retailers are reducing their real estate requirements,” Mark Rothschild, an analysts at financial services firm Canaccord Genuity, said on Monday.
“The next few years are likely to be challenging for retail landlords as they must manage through the impact of Target leaving Canada and many other store closures,” he said.
WATCH: Sixty-six future shop stores across the country will be shutting down. Another 65 are being converted into Best Buys, the parent company of Future Shop. It means the loss of 1,500 jobs. Vassy Kapelos reports.
Comments