Q2 2023 Retail Real Estate Review
with Mark Kurkdjian and Sukh Pannu
Subtle Shifts in Market Momentum
The retail real estate market, never a stranger to change, marked a few noticeable shifts during the second quarter of 2023. As we delve into the details, let’s remember that the character of change is not merely in the shifts themselves but also in the ability of market players to adapt.
Transaction Tides
This quarter’s market dynamics reported 15 notable transactions, subtly easing by 6.25% from the previous quarter. These figures underscore the market’s resilience and inherent vibrancy despite this mild tempering.
Sales Volume Story
Q2’s sales volume, an essential parameter of market health, recorded a total of $50,331,550. Although representing a dip of 24.5% from the preceding quarter, this figure continues to reflect the robust foundation of the retail real estate sector and the sustained investor interest.
Price Palette & Size Spectrum
In Q2, the average property price gently ebbed to $3,355,437, down by 19.38% from Q1. Yet, the market retained its broad reach, accommodating transactions ranging from a modest $935,000 to a handsome $6,700,000.
As for building sizes, the average remained relatively stable, embracing a spectrum from compact 650 SF spaces to sprawling 11,584 SF establishments.
Cost per Square Foot: A Diverse Landscape
The average cost per SF rose to $1,217, with deals ranging from an economical $575/SF to a premium $1,954/SF. This diversity caters to various investor priorities, demonstrating the market’s adaptability.
Steering Through Dynamic Shifts
In light of the Bank of Canada’s recent increase in the key interest rate to 5%, the retail sector is undergoing significant changes. Success in this rapidly evolving landscape hinges on effectively navigating these shifts.
Reflecting on Q2 2023, the retail real estate market has demonstrated remarkable resilience and adaptability amidst fluctuations. As we advance, these qualities will undoubtedly continue to be put to the test. While it’s uncertain when the market will reach its lowest point, there are indications that this could occur as soon. Stay tuned for our next report, where we’ll continue to follow these trends and provide you with the insights you need to navigate this dynamic landscape.
Q2 Retail Real Estate Metrics at a Glance
| Total number of Transactions: | 15 |
| Total Volume in Sales: | $50,331,550 |
| Average Price: | $3,355,437 |
| Min – Max Price: | $935,000 – $6,700,000 |
| Average Building Size: | 3,478 SF |
| Min – Max Building Size: | 650 SF – 11,584 SF |
| Average $/SF: | $1,217 |
| Min – Max $/SF: | $575 – $1,954 |
Purchaser Profile by $ Volume
Data Source: Altus Group
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| Mark Kurkdjian Associate Broker Investment Sales & Leasing 604 691 6622 [email protected] |
Sukh Pannu Associate Investment Sales & Leasing 604 691 6631 | 778 266 4000 [email protected] |
