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Open-Air Retail: Weathering Economic Headwinds

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Q4 2023 Retail Report Hero Image

All categories of retail are affected by shifting economic outlooks and changing consumer spending patterns. However, each sub-category of retail, including open-air retail, enclosed malls, and street-level retail, are affected in different ways.

Open-air retail – which includes strip malls, neighbourhood centres, and big box stores – takes centre stage in the latest report from Colliers. Along with vacancy projections and the impact of declining consumer confidence on performance, we survey tenant sentiment on holiday sales projections, opportunities to drive profitability, and priorities for lease renewals. To analyze our portfolio, we surveyed a stratified sample of tenants across our 8 million square foot national retail portfolio.

Key takeaways:

  1. Open-air retail vacancy is expected to decline 1-2% over the next two years, outperforming overall retail vacancy rates.

    Q4 2023 Retail Report KT1

    Source: MSCI and Colliers

  2. Necessity retail – the largest percentage of open-air retail tenants – will continue to excel over the next two years, despite declining consumer confidence. A decline consumer confidence does not impact necessity retail as significantly as non-necessity retail.

    Q4 2023 Retail Report KT2

    Source: Nanos, Bloomberg, and Colliers

  3. 41% of open-air retailers are interested in engaging with the owner and manager on initiatives to drive greater profitability, which could include strengthening their online presence.

Q4 2023 Retail Report Search Card Image

Open-Air Retail: Weathering Economic Headwinds

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For More Information, Please Contact:

John Duda

President, Real Estate Management Services Canada

Toronto Downtown

John Duda is the President of Real Estate Management Services, Canada. John began his career as Director of National Property Services at CIBC, joining Colliers in 2010. Appointed as head of Real Estate Management Services in 2017, John has driven significant growth both organically and strategically through the development of new service lines and markets. In his role as president, John a oversees 14 offices across Canada, working closely with local teams to create value-driven strategies in support of clients’ goals. 

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Stephanie Hannon

Senior Vice President and National Lead, Retail Services

Toronto Downtown

Stephanie is a seasoned senior executive who has over 24 years of expertise in retail, urban, mixed-use, and shopping centre leasing and development.  

She is an expert in assessing market value, redeveloping, and repositioning operating assets, and offers a strategic approach and a broad network of knowledge and experience about the retail industry.

Stephanie has a proven ability in managing relationships and building consensus in complex multi-stakeholder environments as well as longstanding relationships with clients across multiple platforms.  Stephanie can align business objectives with strategic plans and provide insightful analysis of complex issues. She is a strong and decisive deal negotiator.

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