Rent on high-end retail strips down: Colliers
Rent fell precipitously in some of Canada's major shopping neighbourhoods this year, a global real estate firm said Tuesday.
Colliers International published its annual ranking of the world' most expensive shopping districts on Tuesday.
Toronto's Bloor Street was the only strip in the country to rank among the 50 most expensive retail rent districts in the world in 2011, with the average square foot in the area going for $291.66 US, good enough for 37th overall.
That's well off the $2,150 US that retailers paid per square foot, on average, along New York's Fifth Avenue, the priciest retail strip in the world.
Rents along Bloor Street were largely unchanged compared with last year, as they were along Vancouver's Robson Street, where they stayed steady at an average of $194.44 US per square foot.
But other major Canadian retail strips saw rents fall dramatically.
Average rent for a square foot of space in Ottawa's Byward Market went for $38.89 US per square foot last year, a 20 per cent drop. And Calgary's 17th Avenue saw a drop of almost 27 per cent drop, to $53.47 US per square foot, on average.
Colliers put a positive spin on the data, with vice-president Drew Keddy noting that with the Canadian market being a comparative bargain, more global firms might be encouraged to set up shop here.
Facts in Canada's favour
"Canada is positioned in a unique place in terms of market attractiveness to retailers," Keddy said. "Our economy has bounced back faster than other markets around the world and our currency continues to strengthen.
"These factors, coupled with high sales per square foot and relatively low rent rates, create perfect conditions for international players to expand their presence here"
Saskatoon's Broadway Avenue was the only Canadian city to see a major jump in retail rents, with space going for $34.03 US per square foot, on average, this year.
That was very much the trend in some of the world's most prestigious retail strips. Rent on Fifth Avenue in New York was up by $900 US per square foot, or 72 per cent. The No. 2 slot went to Hong Kong's Russell Street in Causeway Bay, where the average square foot of retail space went for $1,510 US this year, up 25.6 per cent.
Rising rents, globally, are perhaps a lagging indicator of a major turnaround in the fortunes of retailers. Publicly traded luxury brands have seen their share prices soar since the start of 2010. Burberry, for example, is up 124.5 per cent.
Other luxury names like Bulgari, Richemont-Cartier, Tiffany, LVMH Moet Hennessey Louis Vuitton and PPR-Gucci are all up significantly over the past 17 months.