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Where are retail vacancy rates at Where do you think market rents
right now? Any predictions for the next year? are going in 2019/20?

MS: Retail vacancy is currently hovering in the 6% range, MS: It’s often said in our industry that “rent is a function of
which is 2—3% higher than we got used to during the glory sales” and that has never been more important than today.
years of Power Centre development. That era officially
ended with a thud when Target suddenly abandoned “Market Rent” becomes a moot point if the tenant can’t
Canada in 2015, leaving 133 vacancies and over 20M afford to pay it, and unfortunately there have been too
square feet behind across all major markets. many examples of retailers failing over the past few
years. In order to obtain market rent, it’s critical to
Two years later, just as we were putting that disaster behind know which brands are best in class performers in their
us, Sears announced their own Canadian liquidation, which particular market – and this might mean drilling down by
the industry is now dealing with. Almost half of the current neighbourhood or in some instances even by block or side
retail vacancy in Winnipeg (roughly 600,000 square feet) of the street. By the same token, “highest and best use” for
can be attributed to the 4 former Sears stores. properties and specific spaces is a moving target. Medical
clinics, daycares, and fitness clubs are now operating
As new businesses begin opening in these properties and successfully in units formerly occupied by more “traditional”
with limited new retail development on the horizon, the retail tenancies. With a growing population and limited new
vacancy rate stands to improve over the next couple of retail development on the horizon market rents may actually
years. That said, we’re not out of the woods. The recent increase in the coming years due to a lack of quality supply.
closures of HBC’s Home Outfitters chain (Hudson’s Home However, building owners will need to invest to attract the
in Winnipeg) and Forever 21’s announcement that they will best tenants who can afford to pay them.
be closing their 44 Canadian stores are stark reminders of
the competitive forces at play in retail.

WE KNOW THE

BUILDING IS

JUST THE START

QuadReal’s purpose is to create working environments
that enhance the lives of the people and communities
we serve. By demonstrating a meticulous attention
to detail and being responsive to our tenants’ needs,
we offer a level of engagement like no other.

Industrial Leasing Opportunities:
204-259-7375

WINNIPEG, MANITOBA LEARN MORE AT QUADREAL.COM

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