VANCOUVER – Retail space on Robson is a relative bargain compared to lease rates at high-end fashion hubs in the U.S. and around the world, according to a Colliers International report.
The average lease rate on Robson is $194 a square foot (all prices U.S.), less than a tenth the prices on Fifth Avenue in New York and significantly less than lease rates on comparable streets in London, Paris and Hong Kong.
Robson is the third most expensive street in Canada behind Bloor Street in Toronto ($292) and Ste-Catherine Street in Montreal ($204). Victoria and Calgary clock in at $53 a square foot.
But Drew Keddy, vice-president, Canada, and national retail leader for the real estate company, expects Canadian lease rates to climb as vacancy rates move down and more U.S. retailers move north. Canada has bounced back faster than other world economies and the loonie remains strong, making Canadian cities an attractive value proposition, he said.
“With all these announcements of U.S. retailers making their forays into Canada, you’re going to see a lot more competition for quality retail space,” said Keddy, who is based in Vancouver.
Target has garnered much of the publicity for its plans to move north, but other high-profile retailers have talked about setting up shop in Canada, including Nordstrom. While those stores are in a different category than the type of luxury stores found on Robson, the trend will push up lease rates on higher-end streets, he said.
“It’s going to have an impact on our rental rates, for sure.”
Canada is a less competitive retail environment than the U.S., which is one factor that suppresses high-end lease rates here, he said.
Toronto remains the top ”internationally exposed city” in Canada, despite the spotlight that shone on Vancouver during the 2010 Olympics, Keddy said.
“Toronto is probably a more established international city,” Keddy said. “Vancouver’s really been coming on the scene in the last decade or two.”
Canadians spend about the same amount as Americans on retail, but there is much less retail space in Canada compared to the U.S., on a per-capita basis.
Source: The Vancouver Sun