2012 Fall Retail Report

Canadian Retailers Should Expect their Cash Registers to Work Overtime this Holiday Season According to Colliers International Forecast

-- Holiday retail sales expected to grow by about 4.6 per cent compared to 2011, topping $34 billion; Western provinces to lead the sales boon, mainly in Alberta and Saskatchewan --

Toronto and Vancouver, November 19, 2012 – Canadian retailers should expect their cash registers to work overtime to the tune of over $34 billion in holiday sales (excluding automotive and gas), according to Colliers International’s 2012 Fall Retail Forecast report released today. This represents an increase of 4.6 per cent in December sales volume of traditional shopping centre retail categories, relative to the $32.7 billion in holiday sales in 2011.  

The healthy holiday season outlook  for retailers follows a relatively strong performance over the first half of this year, mainly in the Clothing and Clothing Accessories category (7.9 per cent increase compared to 2011), as well as in the General Merchandise category (5.8 per cent increase compared to 2011). Colliers’ forecast, which is generated using a trend-based model comparing recent activity with historical patterns, estimates the total retail sales (excluding Automotive) for 2012 to surpass $307.6 billion. This represents a 3.5 per cent increase, eclipsing last year’s total retail sales of nearly $297.2 billion.
“Despite continued uncertainty in the global economy, Canadian retail spending levels have been remarkably resilient,” says David Bell, Senior Associate, Planning and Retail Consulting with Colliers International in Canada. “While Ontario’s steady growth is important, given its role as the largest retail market in Canada, much of the country’s retail sales growth will continue to be driven by the strength of other regional economies, particularly in Western Canada.”

On a regional basis, the Colliers report expects the provinces of Alberta (7.9 per cent), Saskatchewan (6.8 per cent), Newfoundland and Labrador (5.6 per cent) and British Columbia (4.8 per cent) to lead the charge in December holiday sales growth year-over-year ($4.8 billion, $1.1 billion, $600 million and $4.6 billion, respectively).

Fall 2012 Retail Report provincial retail spending forecast chart

Shopping Centre Inventory

The Colliers International Retail Report also examines the level of retail real estate inventory across Canada available to service Canadians in terms of retail square foot per capita. James Smerdon, Director of Retail Consulting for Colliers in Canada, says, “Some markets with net growth in supply are barely keeping pace with population growth.” But he notes that the real story is the differences between cities. “Canadian cities cannot be discussed as a single market type. Victoria and Halifax may be similar in size and context, but in their retail development structure, they are completely different kettles of fish.”

According to the report, and based on data from the Centre for the Study of Commercial Activity (CSCA), power centre-type retail locations continued to expand in most markets across Canada, while shopping mall formats saw some dramatic expansion in some markets and decline in others. The city of Montreal saw the largest growth in both types of retail space with more than 2.5 million square feet of net new space. Halifax holds the title this year of the city with the highest shopping mall floor area per capita (19 SQF) and Edmonton holds a similar ranking for power centre space per person (9.7 SQF). British Columbia’s capital city, Victoria, is currently the most underserved market when it comes to shopping malls, with only 9.3 square feet per person.

Report and Forecast Methodology

The Canadian Retail Sales Forecast in Colliers’ 2012 Fall Retail Report is based on a model that projects future retail sales by comparing recent sales by province and retail industry classification (NAICS codes) to historical patterns. 

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