It’s no secret that the retail industry is in a period of change. Many commercial retail landlords have been experiencing a wild shift in their tenancy due to stores like Sears, Target, Gymboree and so on closing their doors. Each of their store closings has left large empty spaces for landlords to fill.
Thus, the question that must be answered is - who can and will fill this vacancy? How do we locate and attract those retailers to our space? Does store closings mean lack of demand?
Filling Large Vacancy with Foreign Shop Owners
Canadian tourism is strong and the favorable legal statutes have allowed new industries to thrive. Targeting foreign shop owners to help fill empty spaces is a new wave in retail development, as foreign shops add diversity and cultural experience to the tenant mix.
Japanese retail giants Muji, Oomomo and Uniqlo are part of this new retail wave, as each of them has decided to open stores in Canada. These foreign retailers and others like them offer a great solution to compete with e-commerce. Instead of waiting for their foreign products to arrive, they are now available down the street for some Canadian shoppers.
When a Canadian visits a store owned by a foreigner; the products available, the store layout and colors immediately stands out. Foreign retailers are not just selling their product, but a piece of their culture. This unique customer shopping experience directly improves the foot traffic to the shopping center and helps to fill larger vacancies faster.
Filling Large Vacancy with Food Halls
Providing an experience has made the social aspects of food halls just as important as the food. People love food, and food with an experience will keep the masses coming back.
For example, Upper Canada Mall in Newmarket, Ontario, was left with a large vacancy due to the exit of Target Canada. Although this storyline has been repeated over again in many places around the world, it still leaves many retailers trying to figure out the best way to fill the vacancy and reduce the losses.
Some choose to go after a similar tenant type to fill vacancies, while others take advantage of retail trends and seek to diversify into growth sectors. In the case for Upper Canada Mall, after a year of vacancy, they were able to fill their large vacant space with Market & Co., a 40,000-square-foot food hall.
The food hall concept is a new merger helping some commercial landlords to attract shoppers and foodies with the use of technology. Unlike the traditional food court, food halls go beyond what you would normally find in a food court and offer gourmet flair. Retailers utilizing social media to showcase their food offering have directly impacted the retailer, as diners from unlikely locations travel to do business with them. Those same customers indirectly help the neighboring businesses as well.
Creating diverse retail options, like a food hall, is a new trend helping both Canadian and US commercial landlords to fill their vacancies.
Adapting to the market is key to unlocking cash flow. Recent store closing helps landlords to reposition their assets to remain competitive. The creative use of technology for both landlords and retailers will shorten the cycle of filling the vacancy and increase foot traffic. Food halls and foreign shop owners are great ways to add a unique flair to your tenant mix.
Contact ReDev to begin investing in retail opportunities today!