Saskatoon’s retail sector is bucking a commercial real estate trend in the city.
While the office, industrial and multi-family sectors are under performing, the retail side is doing “quite well,” according to Duncan Mayer, research manager for Saskatchewan at Colliers International.
That may be an understatement.
Case in point is a 100,000-square-foot addition to Preston Crossing, a Walmart-anchored Saskatoon shopping complex. Shovels have only just gone into the ground and already the new space is 97 per cent leased.
The $17-million addition, which will take Preston Crossing’s size up to nearly 800,000 square feet, won’t complete until next January but is expected to welcome a lot of new retail brands when it does.
It will be a few weeks until the names of the new tenants are released but Mayer said a good portion of the demand is from companies looking to make their first splash in the city.
He attributed at least part of the popularity of the new space to the fact that a significant number of buildings along the city’s primary retail corridor along 8th Street were built in the ’50s and ’60s.
“They’re reaching their capacity for age. That’s typically the most desirable area in Saskatoon,” he said.
The retail story is in stark contrast to the city’s industrial sector, where many builders built on spec during the boom before commodity prices fell, leading to a 13 per cent vacancy rate, and the suburban office market, which has a 15 per cent vacancy rate. “It’s just because of the supply. It’s not as if people are closing up shop,” Meyer said.