Brick-and-mortar retail is experiencing a resurgence, with demand for neighbourhood plazas and grocery-anchored centres contributing to vacancy below one per cent in some Greater Vancouver suburbs, according to a new report from REMAX.
The REMAX Canada Fall 2026 Commercial Real Estate Report examined commercial real estate activity across Canada throughout the first half of the year in all key sectors including multi-family residential, industrial, office, retail, development land, and farmland. It identifies top-performing segments, key factors influencing the market, along with emerging trends, policies impacting growth, and barriers/levers to unlock future potential.
Retail continued to demonstrate remarkable resilience with positive momentum evident in Greater Vancouver, Edmonton, Calgary, Saskatoon, Winnipeg, London, the Greater Toronto Area, Ottawa, Halifax and Newfoundland-Labrador, said the report.
Market conditions are strong for selected formats with the main drivers being grocery anchors, necessity-based shopping, medical and wellness services, restaurants and smaller-format tenants.
“Grocery-anchored shopping centres, neighbourhood plazas and smaller service-oriented retail properties remained among the most sought-after assets with health, wellness, beauty, medical and food-service operators accounting for an increasing share of demand,” explained REMAX.
“Smaller spaces, generally ranging between 1,000 and 3,000 sq. ft., continued to attract considerable attention as businesses reassessed their space requirements and sought greater operating efficiencies.”
Market Highlights:
- Greater Vancouver emerged as one of the strongest retail investment markets, with retail investment dollar volumes rising while investment in other asset classes declined. Vacancy remained below three per cent downtown and less than one per cent in some suburban neighbourhoods, where a lack of new construction contributed to increasingly tight conditions;
- Edmonton, Calgary and Ottawa also experienced strong demand for well-located retail space, while established shopping areas in London, Saskatoon and Winnipeg continued to perform well;
- Conditions remained more subdued in Regina, where retail activity in the downtown mall was relatively flat and rents faced some pressure (but neighbourhood retail remained strong), and in Kelowna, where demand remained steady, but investment activity has yet to gain significant ground. Traditional shopping malls, larger retail units and select downtown locations continued to face challenges in several markets.
Regional differences:
▪ Greater Vancouver and Calgary benefit from limited new supply;
▪ Edmonton has strong demand along major roads;
▪ Toronto commands high rents in prime urban locations;
▪ Halifax benefits from neighbourhood consumer demand.
Household budget pressures, higher occupancy costs and weaker foot traffic in some traditional malls and downtown locations were identified as key risks for the retail market.
“Supply has become increasingly constrained in some of the country’s key commercial markets,” said Don Kottick, President of REMAX Canada. “Demand for smaller industrial units and neighbourhood retail space has remained strong in many markets, yet high construction and financing costs continue to limit new development. Higher bond yields and economic uncertainty could prolong that imbalance, depending on local demand and development activity. If confidence improves, limited suitable space could constrain transactions in some markets; the timing and extent of any change remain uncertain.”
“Capital is flowing, but investors are trying to make every dollar count,” said Kristie Kimnach, Global Executive Director of REMAX Commercial. “We’ve seen considerable investment in established, income-producing properties this year, particularly in markets where demand remains strong. The challenge in some of these markets seems to have been finding enough quality product to meet investor demand. Elsewhere, we are hearing that rising availability and slower absorption have put pressure on rents and values, creating a very different set of market conditions.”
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