2020 Retail Report METRO VANCOUVER MARKET OVERVIEW - Lee & Associates Vancouver
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RICHMOND CENTRE | SHAPE PROPERTIES
2020 Retail
Report
METRO VANCOUVER MARKET OVERVIEW
Metro Vancouver Overview
RETAIL MARKET FORECAST RETAIL INVESTMENT SNAPSHOT
INDICATOR TREND COMPLETED DEALS 2019 2020 TREND
Vacancy Number of Sales* 271 176 q
Net Absorption Transaction Volume* (CAD) 2.374 Billion 0.775 Billion q
New Development p
Source: Realnet, Lee & Associates Research
Rental Rates
Cap Rates p
NOTABLE RETAIL SALE TRANSACTIONS
PROPERTY ADDRESS | NAME MUNICIPALITY PRICE SIZE (SF) PRICE/SF PURCHASER(S) CAP RATES (%)
Keltic Canada Development
Trenant Park Square Delta $64,500,000.00 138,716 465 4.6
(1227380 B.C. Ltd.)
475 West Hastings Street* Vancouver $30,150,000.00 8,400 3,589 — 1.7
Robson Street Retail
465 North Road & 500 Austin Avenue Coquitlam $21,150,000.00 9,397 2,251 Choice Properties REIT 1.7
8898-152nd Street Surrey $29,000,000 45,885 $632 West Fraser Developments 4.4
2020 marks the start of a new decade, however, the unprecedented effects of COVID-19 Huntingdon Station Abbotsford $12,379,000.00 14,780 838 Mihyou Holdings Ltd. 4.4
on the global economy have resulted in a disproportionate impact on retail real estate. Elenore on Fifth Vancouver $9,119,855.00 10,808 844 1249119 B.C. Ltd. —
2041 West 4th Avenue Vancouver $8,800,000.00 8,381 1,050 MGF Investments Ltd. —
The BC Government has also taken unprecedented action in response, extending the provincial state of emergency for a record-breaking
1179, 1181, 1187 & 1193 Denman Solterra Development Corp.
17th time as of October 27th. Retail players in the Metro Vancouver market have been forced to re-evaluate, restructure, and right-size their Vancouver $8,600,000.00 4,082 2,107 —
Street (Beach Bay Cafe Ltd.)
business, but despite the economic downturn, many retailers remain resilient. Shoppers returned after lock-down fatigue and retail sales
Little Mountain Plaza Vancouver $6,600,000.00 8,867 744 Michelle's Import Plus Ltd. 3.1
picked up. Sales at general merchandise stores were up across the country and major grocery retailers and e-commerce sales soared.
4305 Dunbar Street* Vancouer $6,600,000.00 6,1337 1,075 Beta Enterprises Ltd. —
The retail leasing market is starting to pick up as retailers take their finger off the pause button. The trend is for more collaboration between The Crossing* Abbotsford $5,500,000.19 13,610 404 1233836 B.C. Ltd. 4.0
landlords and tenants to optimize opportunities. Retail investment activity has been modest, with a total of 176 recorded sales. The market 2077-2079 West 4th Avenue* Vancouver $4,000,000.00 4,509 883 2077 West 4th Avenue Nominee Ltd. —
recorded just 16 investment transactions between $5 and $10 million; there were eight transactions about $10 million.
NOTABLE RETAIL LEASE TRANSACTIONS
The demand for retail remains stable as supply constraints are particularly tight in open-air/strip retail centres which traditionally offer preferred
retail fundamentals such as exposure, parking, and ease of access and egress. PROPERTY ADDRESS | NAME MUNICIPALITY TENANT SIZE (SF)
6771 Marine Way | Big Bend Crossing* Burnaby Sungiven Foods 28,144
2430 Burrard Street* Vancouver KIA Motors 10,909
CURRENTLY UNDER CONSTRUCTION AND POTENTIAL DEVELOPMENTS | LOWER MAINLAND 9711-9771 Bridgeport Road* Richmond Sungiven Foods 10,000
1595 Marine Drive* North Vancouver Sungiven Foods 9,913
DEVELOPER PROJECT NAME MUNICIPALITY RETAIL SIZE NOTABLE TENANTS EST. COMPLETION
113 & 115 - 2777 Gladwin Road* Abbotsford Sabzi Mandi Supermarket 8,549
Shape Properties The City of Lougheed Burnaby 1,400,000 TBD Q1 2020
11900 Haney Place | Haney Place Mall Maple Ridge Fraser Health Urgent Care Centre 8,211
Shape Properties The Amazing Brentwood Burnaby 547,192 Cineplex, Sporting Life Q2 2020
38310 Buckley Avenue | Jumar Squamish Eagle Kids Daycare 6,180
Overwaitea Foods, Bed Bath & Beyond,
Anthem Properties/Beedie Station Square Burnaby 450,000 Q4 2021 1640 152nd Street* Surrey Sungiven Foods 6,000
Best Buy
Quadreal The Post Vancouver 200,000 Loblaw’s, Amazon 2022 8533 River District* Vancouver Pet Valu Canada 4,800
Jim Pattison Developments Guildford Village Surrey 114,000 Save On Foods Q2 2021 4180 Bayview Street* Richmond PetValu 4,000
10580 -10590 King George* Surrey Drake Medox Training & Development 3,612
South Street Developments Atmosphere Richmond 70,000 TBD 2021
4464 Dunbar Street* Vancouver Jak's Beer Wine Spirits 3,582
Quadreal Oakridge Centre Vancouver 360,000 TBD Phased until 2031
12161-72nd Avenue | Strawberry Hill Shopping Centre Surrey Five Guys Burgers and Fries 2,902
Onni Gilmore Place Burnaby 450,000 TBD Q2 2024
432 West Hastings Street* Vancouver Dimensions Art Gallery 2,655
Shape Properties/Cadillac
Richmond Centre Richmond 362,000 TBD Phased until 2026 1062 Homer Street* Vancouver Dwell Living 2,575
Fairview
Concord Pacific False Creek District Vancouver 230,000 TBD Phased until 2027
*Brokered by Lee & Associates
2020 | Metro Vancouver Market Report leevancouver.com/research
Downtown Vancouver Market Overview
Downtown Vancouver Core DOWNTOWN VANCOUVER LEASE RATES MAP
The Downtown core is experiencing major rejuvenation with several large construction projects currently
underway. The retail environment surrounding Pacific Centre is attracting newcomers and revitalizing the
shopping experience in the neighbourhood.
Construction is in full-swing at the corner of West Georgia Street and Hornby Street where Pacific Centre’s
iconic glass dome will be replaced by 14,000 square feet of retail podium. The Four Seasons Hotel
vacated the hotel portion of the shopping centre earlier this year. Cadillac Fairview has announced plans
to renovate the 28-storey hotel tower for a new hotelier. H&M and Sephora both expanded their Pacific
Centre locations this year; the Swedish fashion retailer adds a full floor to their store — bringing their retail
footprint to 40,000 square feet over three levels; Sephora renovated their location at the northwest corner
of the mall and now occupies 7,000 square feet.
Earlier this year, UGG Australia closed its doors on Robson Street and is now taken over by Lululemon-
adding 2,300 square feet of additional space to their 4,500 square foot store on the corner of Burrard Street
and Robson Street. Foot Locker is confirmed to be the tenant at the new retail building at 1067 Robson
Street, occupying 20,000 square feet. New tenants to the shopping corridor include OVO, Uncle Tetsu,
Oomomo, and Mountain Warehouse.
Vancouver’s “Luxury Zone” bordering the streets of West Georgia, Alberni, Thurlow, and Hornby, had a
significant influx of tenants such as Van Cleef Arpels, Oliver Peoples, and Off-White. Hermes’ flagship store
relocates to a two-storey location on the corner of Burrard Street and West Georgia Street.
Quadreal’s “The Post” development at the corner of Homer Street and West Georgia Street will be the
future location of Amazon’s Vancouver offices as well as a Loblaw’s City Market — the 50,000 square foot
store will become the largest grocery store in Downtown Vancouver.
Gastown | Railtown
Gastown, a historically renowned destination for tourists and locals alike, has evolved into a trendy part of
Downtown Vancouver. The retail landscape has evolved with the influx of boutiques, up-scale restaurants,
cafés, stylish art galleries and unique fashion retailers. Herschel, Le Labo, and Gravity Pope are notable new
retailers in this area.
LEASE RATE TRENDS | DOWNTOWN VANCOUVER
Yaletown STREET TREND NET RENT TAX & CAM STREET TREND NET RENT TAX & CAM
This submarket is home to some of the city’s best salons, restaurants, and lounges. The proximity to high-density condo towers and the `Canada SEGMENT PSF 2020* 2020* SEGMENT PSF 2020* 2020*
Line Skytrain Station at Davie and Mainland Streets complement the area. Retrofit brick and beam former warehouse buildings now facilitate Alberni Street $150 – $300 $25 – $50
Robson Street
$50 – $235 $20 – $45
p (Beatty to Burrard) p
retail spaces and quality offices above.
Burrard Street Robson Street
$40 – $200 $15 – $40 q $50 – $120 $20 – $40
(Georgia to Davie) (Bute to Denman)
Demand for this heritage submarket remains steady with recent entrants such as Small Victory Cafe, Do Chay, Field & Social, and Elisa - Top Table
Group’s new 6,800 square foot steakhouse. Davie Street $30 – $65 $15 – $20
Abbott Street
$30 – $50 $15 – $25
p (Expo to Hastings)
MACROECONOMIC FACTORS Denman $40 – $75 $20 – $30 Gastown p $25 – $90 $15 – $25
CANADA CURRENT TREND BRITISH COLUMBIA CURRENT TREND Granville Street
p $40 – $150 $15 – $30 Railtown p $15 – $25 $8 – $14
(Downtown)
Consumer Price Index 132.5 p Unemployment Rate 8.4 q
CAD/USD $0.76 q Total Building Permits $1.111 Billion q Hornby Street $45 – $180 $20 – $50 Yaletown p $40 – $95 $20 – $30
Prime Lending Rate 2.45% Retail Sales $7.6 Billion* p
Robson Street
Overnight Rate 0.25% $120 – $250 $50 – $65 West Georgia p $35 – $175 $20 – $35
*Seasonally adjusted (Burrard to Bute)
*Estimated
2020 | Metro Vancouver Market Report leevancouver.com/research
Vancouver Submarkets Overview
South Granville VANCOUVER LEASE RATES MAP
South Granville is a sophisticated shopping district where premier brands have assembled outside the
Downtown Core. High-end apparel and furniture retailers such as Pottery Barn, Restoration Hardware, EQ3,
and Anthropologie have established themselves in this affluent shopping district. There has been some
recent activity in the market as higher rates are forcing some retailers to reconsider their presence in the
market. Typically vacancy rates are very low as retailers benefit from the central location and high traffic.
Kitsilano (Kits)
Within close proximity to The University of British Columbia, this area is popular with students and lifestyle
conscious residents who enjoy Kitsilano for its organic food markets, fashion, eateries and close proximity to
beaches along the south shore of English Bay. New retail tenants to Kits and its main retail corridor — West
4th Avenue — include the first Vancouver locations for eCommerce turned brick-and-mortar retailers Casper
Sleep Shop, Warby Parker, and KNIX.
OAKRIDGE CENTRE | QUADREAL
LEASE RATE TRENDS | VANCOUVER SUBMARKETS
Cambie Street
The Oakridge Centre redevelopment is a 28.5-acre site centred around the current Oakridge Shopping Centre at 41st Avenue and Cambie STREET TREND NET RENT TAX & CAM STREET TREND NET RENT TAX & CAM
SEGMENT PSF 2020* 2020* SEGMENT PSF 2020* 2020*
Street. It is the largest project in Vancouver to-date with redevelopment densification featuring 1,000,000 square feet of retail, a 100,000 square
foot community cente, and 2,600 residential units. With the exception of The Bay and Crate and Barrel, stores have been closed in order to Commercial Drive
p $30 – $45 $10 – $15 Chinatown p $18 – $35 $10 – $15
expedite construction; completion is phased until 2026. (Venables to 13th Ave)
South Granville West 4th Avenue
North Shore (5th to 16th Ave)
$30 – $90 $20 – $40
(Burrard to Alma)
$30 – $100 $15 – $25
The North Shore boasts some of the highest household and disposable incomes in Metro Vancouver. Park Royal Mall dominates West
West Broadway
Vancouver’s retail landscape--additions to the shopping centre include a 44,000 square foot Cineplex theatre, Tractor’s first North Shore location, Kingsway $15 – $35 $10 – $15 p $22 – $65 $10 – $20
(Main to Granville)
and Japanese restaurant, ZUBU Ramen.
Main Street West Broadway
p $20 – $70 $10 – $25 $25 – $55 $15 – $30
Over in North Vancouver, the Lower Lonsdale ‘LoLo’ district has experienced major rejuvenation with the significant influx of local and national (Broadway to 28th Ave) (Granville to Alma)
retailers as well as the addition of a new 9,500 square foot JOEY restaurant and Metro Vancouver’s largest outdoor skating rink at the redeveloped
Shipyards location next to Lonsdale Quay. Cambie Street
p $30 – $75 $15 – $30 East Hastings Street p $20 – $40 $10 – $15
(2nd Ave to 19th Ave)
2020 | Metro Vancouver Market Report leevancouver.com/research
Suburban Markets Overview
THE AMAZING BRENTWOOD | SHAPE PROPERTIES
Suburban Markets Overview
The suburban markets have seen significant retail and residential growth over the past year,
most notably Richmond, Burnaby and New Westminster. With the exception of high demand
lease opportunities in close proximity to rapid transit stations, the overall tone of retail leasing
activity in the suburban markets has retailers cautiously evaluating new locations.
Burnaby | New Westminster
The Amazing Brentwood project in North Burnaby is nearly complete and has started
opening stores to the public. Shape Properties’ re-developed shopping centre houses
1,100,000 square feet of retail and 500,000 square feet of office space. One SkyTrain stop
away, construction started earlier this year at ONNI’s Gilmore Place development along
Lougheed Highway and Gilmore Street; this project is comprised of 10 towers with 450,000
square feet retail and over 1,000,000 square feet of office space. Over in Central Burnaby,
Anthem Properties and Beedie Group are redeveloping Metrotown at Station Square.
Started in 2012, it will be fully completed in 2021 and will incorporate seven towers with
1,500 homes and over 450,000 square feet of new retail.
New Westminster continues to see strong multifamily residential growth and with it, increased demand from consumers. Uptown (Sixth
Street & Sixth Avenue) and Downtown New West continues to be the most desirable area for retailers. The other notable retail is the new
Brewery District development; the redevelopment of the Labatt Brewery is a nine-acre site centred around Sapperton Skytrain Station
METRO VANCOUVER DEMOGRAPHICS
and the Royal Columbian Hospital with redevelopment densification featuring 140,000 square feet of retail, 600,000 square feet of office MUNICIPALITY POPULATION MED. AGE AVG. INCOME MUNICIPALITY POPULATION MED. AGE AVG. INCOME
spaces, and 750 residential units.
Vancouver 682,404 39.6 $112,459 Langley 162,000 41.9 $82,595
West Vancouver 45,858 51 $228,522 Coquitlam 162,399 41.1 $110,533
Richmond
North Vancouver 152,223 43.3 $140,129 Port Coquitlam 65,862 40.7 $111,987
Richmond is experiencing extensive residential development particularly along the No. 3 Road corridor with urban villages clustering around the
Canada Line transit stations. Strip malls are transforming into high-rise residential and commercial buildings. Lease rates along the transit route Burnaby 259,715 39.8 $98,866 Port Moody 38,465 40.6 $130,587
have seen sharp increases with the demolition of older existing retail and the development of mixed use projects. New Westminster 81,568 41.3 $95,341 Pitt Meadows 21,432 42.2 $116,643
Over at the Richmond-Brighouse neighbourhood, the recently approved 27-acre Richmond Centre redevelopment project is the city’s Richmond 216,320 43.3 $99,563 Maple Ridge 92,056 41.2 $115,861
largest development project to date — when fully built-out, the shopping centre will total approximately 2.7 million square feet with 2,000 Delta 117,185 44.4 $131,035 Abbotsford 158,245 38.6 $103,472
residential units and 500,000 square feet of new retail.
Surrey 574,657 38.8 $110,097 Mission 43,456 40.5 $103,258
McArthurGlen Designer Outlet Mall is a joint venture between the Vancouver Airport Authority and McArthurGlen, Europe’s largest owner and White Rock 22,028 57 $106,307 Chilliwack 93,687 40.6 $95,939
developer of high-end outlet malls. Retailers such as Adidas, The North Face, Jimmy Choo, Stuart Weitzman, All Saints, Herschel, Burberry, as
well as Aritzia’s first outlet store in Western Canada and the first Mara outlet store in the world are just a few of the new tenants at the outlet mall.
Source: Environics Analytics 2020 Estimate
2020 | Metro Vancouver Market Report leevancouver.com/research
Metro Vancouver Market Overview Lee & Associates Vancouver Retail Team
Delta, Ladner | Tsawassen Neil S McAllister Personal Real Estate Corporation
Senior Vice President
Two of the larger retail projects currently under construction in neil.mcallister@lee-associates.com | 604.630.3374
Metro Vancouver are Tsawwassen Mills and Tsawwassen Commons
being developed in tandem by Ivanhoe Cambridge, The Property For over 25 years, Neil has established himself as a key real estate market strategist in the retail brokerage industry.
Development Group, and Tsawwassen First Nations. The projects His extensive and encompassing background in commercial real estate brokerage, coupled with his relationships
throughout the industry, has contributed to our firm’s ability to continually strengthen client support and expand the
are situated at the intersection of Highway 17 and 52nd Street range of services available to new and existing clientele.
in Tsawwassen, featuring 1,710,000 square feet of retail space.
Tsawwassen Mills continues to add premier brands such as Kate
Spade and an expanded Michael Kors store to their outlet fashion
Sean Ogilvie
block alongside Saks Off Fifth, Harry Rosen, Coach, and Lululemon. Vice President
sean.ogilvie@lee-associates.com | 604.630.3402
Port Moody | Coquitlam | Port Coquitlam Surrey Central
Since 1997, Sean has demonstrated a great track record for pro-actively dealing with multiple or long term vacancy
issues. Sean brings valuable insight into the unique sub-markets that make up the Lower Mainland’s commercial nodes
Metro Vancouver’s northeast sector is growing with the addition of
which is very useful for tenant mix evaluation and property positioning. Sean has also proven to be very effective in
the Millennium Line Evergreen Extension. As a result, all the nearby
communities are benefitting including Port Moody with even more
Langley assisting tenants to tap into their primary and secondary target market.
high-rises in the town centre. Langley is made up of several shopping districts with Willowbrook
remaining the largest at 200th Street and the Langley Bypass. Retail
Howard Malchy Personal Real Estate Corporation
Further to the east in Port Coquitlam, two new shopping centres activity remains robust in Willowbrook’s main retail node where big box Vice President
have recently been built along Lougheed Highway namely Platform tenants such as Winners, T&T Supermarket, and BC’s first Nordstrom howard.malchy@lee-associates.com | 604.895.2226
Properties’ Oxford Crossing and Fremont Village. Onni Group’s Fremont Rack store have chosen to locate at Willowbrook Shopping Centre.
Village project continues to evolve with tenants that include Canadian Howard has been a key part of our team for 35 years. He specializes in retail and commercial leasing and tenant
representation. He is active in the Greater Vancouver area, including the Downtown Core, the Broadway Corridor, and
Tire, Walmart, Mark’s Work Wearhouse, PetSmart, Dollarama, and The Willoughby area is experiencing further growth wherein Latimer
the Burnaby, Coquitlam, and New Westminster markets.
Shoppers Drug Mart. Fremont Village and the neighboring Dominion Heights, the latest masterplanned community, is being built over
Triangle Shopping Centre accommodate the growing population in 74-acres by Vesta Properties. The mixed-use devepment adds 2,000
the area, particularly the residential growth on nearby Burke Mountain. homes, 35,000 square feet of retail, and 108,000 square feet office
space to the area.
Andrea Fletcher
Surrey Willoughby Town Centre by Qualico, at 80th Avenue and 208th
Senior Associate
andrea.fletcher@lee-associates.com | 604.630.3398
Surrey, BC’s second most populous city after Vancouver, continues Street, is a mixed-use residential project with a village shopping
to be one of the fastest growing markets in Canada with an 8.4% centre anchored by a 27,000 square foot Loblaw’s Independent Andrea has over 25 years of commercial real estate experience working as a blue chip international retailer, as well as a
local and international landlord. Her excellent interpersonal skill set shines during direct interface with client company
population growth over the last three years. The city welcomes over Grocer and a 16,000 square foot Shoppers Drug Mart. Phase I of the
presidents, international, national and regional landlords, and government negotiators. Successes include completing
1,000 new residents every month. Surrey Central City is currently development offers 120,000 square feet of commercial retail space over 900 career lease deals throughout Western Canada.
transitioning into a densely populated commercial node with and 192 residential units.
numerous mixed-use projects slated for construction over the next
five to ten years. PCI’s King George Station, a mixed-use development
under construction anchored by Save-On Foods and Coast Capital
Abbotsford Russell Long, BA, DULE
Senior Associate
Savings’ new head office with over 700 employees. Phase B is slated With a population growth of 9.5% over the last five years, the City of
russell.long@lee-associates.com | 604.630.3059
for completion in 2023 — the development features 260,000 square Abbotsford has the largest population in the Fraser Valley with over
feet of retail space, 450,000 square feet of class ‘A’ office space, and 150,000 residents. There are three key commercial areas in West, Russell joined our Retail Team in June of 2014 as a Research Coordinator while completing his Diploma in Urban Land
1,200,000 square feet of residential space. Central, and East Abbotsford areas — over 2,000,000 square feet of Economics at the University of British Columbia’s Sauder School of Business. Since joining us, Russell has proven to be
retail space is concentrated in Central Abbotsford; big box retailers an integral part of our Retail Team, assisting in tenant and landlord representation, as well as retail investment sales.
Over in North Surrey, Guildford Village, currently under construction, such as Home Depot, Walmart, and Cabela’s have located in the east.
will be anchored by Save On Foods. The 43,500 square foot grocery
store anchors a 114,000 square foot open-air shopping centre — Prominent shopping centres include Highstreet, Abbotsford’s largest Maria Fayloga, Director of Research & Retail Coordinator maria.fayloga@lee-associates.com | 604.630.3375
confirmed co-tenants include a 12,000 square foot daycare. shopping centre anchored by Walmart Supercentre, Cineplex VIP
Cinemas, H&M, and London Drugs, in West Abbotsford; Clearbrook
In South Surrey/White Rock, construction of BOSA’s Miramar Village Town Square, West Oaks Mall, and Sevenoaks Shopping Centre in
At Lee & Associates Vancouver, our brokers have an industry-wide reputation for getting deals done. We focus exclusively on commercial
development in South Surrey completes this year — adding 52,000 Central Abbotsford; and Parallel Marketplace and Sumas Mountain property with the goal of providing clients with in-depth knowledge of the strategic business issues unique to the commercial marketplace.
square feet of retail inventory. Prominent tenants include Starbucks, Village in East Abbotsford. Mount Lehman Crossing, a new strip
Rexall, HSBC, Westminster Savings, 3 Dogs Brewing, and a 25,000 centre anchored by Shoppers Drug Mart and TD Bank, is scheduled As one of the top performing commercial real estate teams in Greater Vancouver, our brokers are industry leaders, possessing extensive
experience and unparalleled expertise — clients can benefit from a proven track record of innovative strategies and problem solving skills.
square foot grocery store. for completion this December.
Our brokers develop long-term relationships with clients to assist them in maximizing returns and achieving continued market success.
2020 | Metro Vancouver Market Report leevancouver.com/research
2020 Retail
Report
METRO VANCOUVER MARKET OVERVIEW
For inquiries please contact
Maria Fayloga
Director of Research
D 604.630.3375
maria.fayloga@lee-associates.com
Lee & Associates Vancouver
475 West Georgia Street, Suite 800
Vancouver, BC V6B 4M9
O 604.684.7117 F 604.684.1017
This report should not be relied upon as a basis for entering
into transactions without seeking specific, qualified,
professional advice. Whilst facts have been rigorously
checked, Lee & Associates can take no responsibility for
any damage or loss suffered as a result of any inadvertent
inaccuracy within this report. Information contained herein
should not, in whole or part, be published, reproduced or
referred to without prior approval. Any such reproduction
should be credited to Lee & Associates.
© 2020 Lee & Associates Commercial Real Estate (BC) Ltd.
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