Regina’s retail real estate sector doesn’t think it’s too much to ask the province for a little economic growth to keep a surprising momentum on track.
The sector’s vacancy rate in the third quarter of 2019 remained flat at 3.7 per cent, which astounds some market observers, considering the ongoing economic stagnation and the departure of Sears Canada a couple of years ago.
Dale Griesser, a broker at Avison Young’s Regina office, said the growth of the city’s suburbs and a modest increase in the overall population have combined to keep the retail sector chugging along.
“There has been no erosion in the rental rates. The absorption of new space has not had any negative effect on the existing supply,” he said.
According to Avison Young’s third-quarter report on Regina’s real estate, the average asking lease rate is $18 per square foot.
The city has three new major developments; Acre 21, a neighbourhood shopping centre on the east side of town featuring Save-On-Foods, Sherwood Co-op gas bar, Shoppers Drug Mart and a liquor store; the nearby Aurora retail centre, a development anchored by a Landmark Cinemas movieplex and a Costco; and Capital Crossing in the northwest, a 75-acre mixed-use development.
If new retail continues to develop, Griesser said, there may be an increase in vacancy rates as tenants leave older spaces for newer ones and landlords try to backfill the resulting vacancies, but it all hinges on consumer confidence.
In order for the retail sector to start to thrive again, he said, the province needs to start churning out some improving economic numbers.
“We’re lucky that the majority of people still have their jobs here, unlike in Alberta. We’re in a flat period. We need some new, quality jobs,” he said.