The company said its vagina-friendly condoms and organic water-based lubricant will be available in 384 stores, including Loblaws, Real Canadian Superstore, Zehrs and Your Independent Grocer locations nationwide.
The move marks nixit’s first expansion into the Canadian mass grocery channel and increases its domestic retail footprint by 52 per cent. The company, founded in 2019 by Rachael Newton, said it has previously grown internationally through its direct-to-consumer business.
The launch comes as consumers increasingly seek ingredient-focused personal care products, according to the company, which cited data showing 72 per cent of Canadian consumers prioritize organic ingredients in personal care products.
“Being available in select Loblaw stores nationwide will allow more Canadians to access high-quality, thoughtfully created sexual wellness products within their everyday routines,” said Rachael Newton, nixit founder. “Better options shouldn’t be inconvenient and comfort shouldn’t be optional.”
Rachael Newton
nixit said its condoms and lubricant products were developed to address concerns around ingredients and comfort in sexual wellness products. The company said the products are made without fragrances, glycerin, spermicides, casein and warming agents.
The condom line is made from natural rubber latex and lubricated with silicone oil, while the lubricant uses an aloe vera-based formula that the company said is pH-matched to vaginas and compatible with menstrual cups, devices and latex condoms.
The products being introduced at Loblaw banners include the Stamina Squad 12-pack condoms with a suggested retail price of $14.99, the Marathon 24-pack condoms priced at $25.99 and the company’s water-based lubricant at $23.99.
nixit describes itself as a company focused on period care and sexual wellness products, including reusable menstrual discs, condoms and lubricants. Loblaw Companies Limited is Canada’s largest retailer, with more than 2,800 locations nationwide.
A Calgary-based Father’s Day fundraising initiative is combining Ferrari culture, luxury hospitality, and community philanthropy through an ambitious charity raffle that will send one winner on an immersive journey to Maranello, Italy, home of the legendary Italian automaker.
The campaign, called “Padre Corsa,” supports the Diabetes Clinic at Alberta Children’s Hospital and has brought together a growing group of Calgary businesses spanning automotive, hospitality, lifestyle, and luxury sectors.
At the centre of the initiative is a Ferrari-themed grand prize designed around Italy’s automotive and culinary culture. Organizers describe the concept as “the kind of gift a son could never wrap, a wife could never quite afford, and a father would talk about for the rest of his life.”
Ferrari Journey Anchors Luxury Fundraising Initiative
According to campaign materials, the prize package includes a private Ferrari factory tour in Maranello, access to the Fiorano test track, live Formula 1 simulators, and a guided visit through Enzo Ferrari’s former home. Winners will also receive access to Ferrari’s Hall of Champions and an exclusive private dinner experience tied to the company’s racing heritage.
The itinerary blends automotive culture with hospitality and experiential travel. Organizers describe portions of the journey unfolding among Tuscany’s villas, restaurants, and historic cobblestone streets before culminating in Ferrari-related programming in Maranello.
The campaign also begins locally in Calgary. Materials for the initiative reference a launch gathering at Burwood Distillery’s Veranda at The Stables venue in Currie Barracks, where the raffle draw will ultimately take place live.
Calgary Brands Collaborate Around Community Giving
The initiative is being led by Burwood Distillery alongside presenting sponsor Calgary Ferrari, with support from a range of Calgary-based businesses and organizations. Participating sponsors include Storybox Creative, Lina’s Market, Willow Park Wine, Stephen Avenue Co., Calgary Tower Club, Rocky Mountain Cigar, Storybot AI, Tammy Routley Realtor, Zulu Cosmetics, and others.
The collaboration reflects a broader trend toward experiential fundraising campaigns that merge luxury branding, hospitality, storytelling, and philanthropy into highly shareable community-driven initiatives.
Rather than relying on traditional fundraising formats such as galas or silent auctions, campaigns like Padre Corsa increasingly aim to create emotionally resonant experiences that engage participants through travel, culture, and aspirational lifestyle storytelling.
Supporting Alberta Children’s Hospital
According to the campaign website, proceeds from ticket sales will support the Diabetes Clinic at Alberta Children’s Hospital in Calgary. Tickets are priced at $100 each as organizers work to raise awareness and community participation ahead of Father’s Day.
Organizers are also encouraging additional sponsors and community partners to become involved as the initiative expands.
Additional information about ticket registration, sponsorship opportunities, and the Padre Corsa campaign itinerary can be found through the official campaign website.
In Q1 2026, AI stopped assisting the shopping journey and started mediating it.
Retail technology is no longer confined to back-office automation, product copy generation, or customer service chatbots. AI is moving closer to discovery, recommendation, merchandising, pricing visibility, loyalty, and increasingly the transaction itself. The result is a structural shift in retail power dynamics: platforms and AI agents are beginning to sit between consumers and retailers, reshaping how demand is created, influenced, monetized, and fulfilled.
For Canadian retailers, the tension is becoming harder to ignore. The more commerce moves into AI-assisted ecosystems, the greater the risk that retailers lose direct control over customer relationships, discovery pathways, and brand visibility unless they have strong first-party data, trusted loyalty ecosystems, operational discipline, and the infrastructure needed to participate in AI-led commerce without becoming dependent on it.
You can see that shift throughout what Retail Insider covered this quarter. Google expanded Gemini shopping partnerships with Walmart, Shopify, and other commerce platforms, moving shopping closer to conversational search. Loblaw launched grocery shopping integrations through ChatGPT and Google Gemini while positioning itself as an “AI-native enterprise.” Canadian Tire scaled its MOSaiC retail intelligence platform with Microsoft to connect merchandising decisions to real-world customer behaviour. RBC and Canadian Tire deepened loyalty integration through Avion and Triangle Rewards. Instacart pushed “Physical AI” smart carts capable of influencing baskets in real time, while platforms such as Square and Shopify embedded AI assistants designed to help smaller merchants operate more like enterprise retailers.
At the same time, consumer trust and security concerns remained elevated. SOTI reported that 84% of Canadians are concerned about at least one privacy or security issue while shopping, while Adyen found that more than half of Canadian shoppers are open to allowing AI to complete purchases on their behalf.
The takeaway for executives is increasingly urgent: AI is no longer simply a technology layer inside retail. It is becoming the interface through which retail increasingly operates.
Overall Retail Technology Coverage by Retail Insider
Retail Insider published 24 Retail Technology stories in Q1 2026, and the mix says a great deal about where the sector is heading. This was not a quarter dominated by experimental gadgets or futuristic store concepts. The centre of gravity shifted toward AI entering core retail workflows: search, discovery, loyalty, merchandising, forecasting, checkout, retail media, operational execution, and decision-making itself.
The coverage leaned heavily toward Trend/Analysis and Product/Format Launch stories, reflecting a market rapidly moving from experimentation into deployment. Retailers and platforms are rolling out AI-enabled capabilities quickly while simultaneously deciding which systems to integrate, which partnerships to pursue, and which parts of the customer relationship they still need to control directly.
Partnerships emerged as one of the defining mechanisms for speed. Google expanded Gemini shopping through retailers and commerce infrastructure partners including Walmart and Shopify. Loblaw integrated grocery planning and purchasing capabilities into ChatGPT and Gemini. Canadian Tire deepened its Microsoft partnership to scale MOSaiC across banners and channels. RBC and Canadian Tire linked loyalty ecosystems to strengthen everyday customer engagement across multiple retail banners. Walmart Connect Canada launched an academy-style certification platform to help suppliers and agencies navigate the rapidly growing retail media ecosystem.
Even operational execution became part of the technology story. The Reset Team demonstrated how technology-enabled rollout infrastructure, standardized field execution, and centralized reporting are becoming strategic advantages as retailers deploy new formats, connected-store technologies, and merchandising programs at increasing speed.
The broader implication is becoming clear: retail technology is no longer sitting at the edge of the business. It is increasingly becoming the operating system of the business itself.
ChatGPT / Open AI
AI Compresses the Shopping Funnel
One of the most important shifts this quarter is that AI is beginning to compress the traditional retail buying funnel.
Historically, retail discovery followed a relatively predictable pattern: search, browse, compare, research, evaluate, select, and purchase. AI-assisted commerce increasingly condenses that process into something far simpler: ask, receive recommendations, and buy.
That changes the economics of retail.
When Google expands Gemini shopping with conversational discovery and instant checkout integrations tied to retailers such as Walmart and Shopify, it moves commerce closer to search and further away from standalone retailer websites and apps. Consumers may increasingly bypass traditional browsing behaviour entirely.
Loblaw’s grocery integrations with ChatGPT and Gemini make that shift especially tangible in Canada. Consumers can now generate meal plans conversationally, build grocery lists, check inventory, and move toward PC Express checkout from inside AI-assisted environments. The traditional grocery discovery process is increasingly becoming machine-assisted commerce.
The implications extend well beyond convenience. If AI systems increasingly guide discovery, recommendation visibility may become as strategically important as physical shelf placement once was. Retailers and brands will need to think differently about assortment visibility, structured product data, pricing transparency, reviews, attributes, and how products appear inside AI-generated recommendations.
This also creates major implications for traffic and discoverability. Retailers, marketplaces, brands, and publishers increasingly face the possibility that consumers may no longer visit websites until the final stages of the transaction process. AI-generated summaries and conversational recommendations could reduce direct traffic, reshape SEO economics, and weaken traditional digital merchandising strategies.
The commercial risk is significant: retailers may gradually lose ownership over the discovery layer while platforms gain increasing influence over what consumers see first.
Adyen’s research adds urgency to that concern. More than half of Canadian consumers told Adyen they are open to allowing AI to complete purchases on their behalf. The disruption is not simply that AI can recommend products. It is that AI increasingly acts as an intermediary between intent and transaction.
That raises difficult strategic questions for retailers. If AI agents optimize around convenience, value, speed, or lowest basket cost, how do retailers maintain differentiation? How do loyalty ecosystems survive if recommendation systems increasingly influence customer choice before a retailer interaction even begins?
This is where Shopify’s role becomes strategically important. Shopify continues positioning itself as flexible commerce infrastructure for an increasingly fragmented AI-commerce environment, investing heavily in Sidekick and multi-channel commerce systems that allow merchants to maintain control over inventory, fulfilment, pricing, and customer rules regardless of where discovery happens.
The retailers best positioned for this shift are likely to be those capable of participating in AI-mediated commerce without fully surrendering the customer relationship. Retailers with strong first-party data, trusted loyalty systems, operational discipline, and reliable fulfilment infrastructure are better positioned than retailers with fragmented systems and weak personalization capabilities.
ChatGPT/Loblaw integration. Image: RI/Google
Loyalty Becomes Infrastructure
The commercial implication is that loyalty is evolving from a marketing tool into a broader infrastructure layer tied to data, payments, personalization, and retention.
The RBC and Canadian Tire partnership linking Avion Rewards and Triangle Rewards illustrates how loyalty is increasingly functioning as commerce infrastructure rather than simply a points program. Eligible RBC cardholders can connect Avion to Triangle Rewards and earn accelerated Canadian Tire Money across banners including Canadian Tire, SportChek, and Mark’s.
For Canadian Tire, the partnership expands the reach of Triangle’s nearly 12 million-member ecosystem while increasing everyday engagement across banners at a time when consumers remain highly price conscious. For RBC, it creates differentiation in an increasingly crowded payments environment.
However, AI-assisted commerce complicates traditional loyalty economics. If AI shopping systems increasingly optimize around value, speed, convenience, or pricing efficiency, retailers may need to rethink how loyalty works altogether. Points-based systems may become less effective if AI agents increasingly influence purchasing behaviour upstream.
That makes first-party data significantly more valuable. Loyalty increasingly functions as a mechanism for behavioural intelligence, personalization, pricing optimization, forecasting, and customer retention. Retailers capable of integrating purchase history, payments behaviour, promotions, loyalty signals, and fulfilment data into unified customer ecosystems gain an advantage in machine-mediated commerce environments.
Trust becomes critically important in this model. SOTI’s research reinforces that consumer willingness to participate in connected retail ecosystems depends heavily on security and confidence. Privacy, transparency, and cybersecurity are no longer operational concerns sitting in the background. They are increasingly commercial necessities.
Retailers Become AI-Native Enterprises
The commercial implication is that AI scale is increasingly becoming an operational and margin separator.
Kyndryl’s retail research captured the shift clearly. Nearly 89% of retail executives expect AI to significantly reshape retail jobs within the next year, while more than 70% are already deploying AI across customer experience, cybersecurity, forecasting, enterprise applications, and operations. However, almost half reported that foundational technology issues continue slowing innovation efforts.
That distinction matters because AI advantage compounds operationally. Retailers with strong infrastructure improve faster. Retailers with fragmented systems struggle to move beyond experimentation.
Canadian Tire’s MOSaiC platform is one of the strongest Canadian examples of AI evolving into operational infrastructure. MOSaiC combines internal sales data, Triangle loyalty insights, weather patterns, local events, and behavioural signals to identify more than 1,000 customer “occasions” that influence merchandising, inventory allocation, promotions, and store execution decisions.
Loblaw is moving in a similar direction. Its ChatGPT and Gemini integrations are not isolated innovation projects. They are part of a broader effort to position the company as an “AI-native enterprise,” integrating conversational commerce, grocery planning, personalization, and fulfilment into the core customer experience.
The strongest retailers increasingly resemble software and data businesses with physical distribution networks attached. AI is becoming embedded in merchandising, pricing, forecasting, logistics, labour planning, customer engagement, and inventory management rather than sitting inside isolated innovation teams.
The operational advantages compound quickly. Better forecasting reduces stockouts and markdowns. Better targeting reduces blanket discounting. Better inventory intelligence improves margins. Better coordination across channels strengthens the customer experience while protecting profitability.
Retailers lacking those foundations may still purchase AI tools, but they will struggle to convert those investments into sustainable operational advantages.
Physical AI Turns Stores Into Programmable Retail Environments
The commercial implication is that physical stores are increasingly becoming connected digital environments rather than static boxes of inventory.
Instacart’s Caper Cart initiative is one of the clearest examples from the quarter. Smart carts equipped with AI-driven recommendation systems can influence customer purchasing behaviour while the shopping trip is actively happening. Instacart reported that prompts such as “Got everything you need?” generated nearly a 1% increase in basket size on average.
For grocers and large-format retailers, this is not simply a novelty. It represents the transformation of the physical store into a programmable retail surface capable of generating data, influencing behaviour, monetizing attention, and integrating directly with loyalty and pricing systems in real time.
This also changes retail media economics. A digital cart screen tied to real-time basket data becomes an advertising and recommendation surface positioned directly beside the shelf. In AI-assisted commerce environments, recommendation visibility increasingly matters as much as physical shelf placement once did.
The infrastructure implications are significant. Connected stores require stable connectivity, device management, integrated pricing systems, loyalty synchronization, maintenance procedures, and staff training. Physical AI systems fail visibly when execution is weak.
That connects directly to another major theme from the quarter: operational execution and workforce enablement are increasingly part of the retail technology stack itself.
Walmart store at Jardins Dorval in Montreal. Photo: Jardins Dorval
Retail Media Becomes a Core Retail Business
One of the most important long-term shifts in retail technology is the transformation of retailers into media and data businesses.
Retail media networks continue expanding because retailers increasingly control valuable first-party customer data tied directly to purchasing behaviour. Walmart Connect Canada’s certification and education initiative illustrates how rapidly the sector is professionalizing.
Retailers are no longer simply selling products. They are monetizing search visibility, sponsored recommendations, audience targeting, basket placement, and customer attention itself.
AI accelerates this shift because machine-driven personalization increases the value of advertising inventory tied directly to consumer behaviour. Retailers capable of combining loyalty data, behavioural signals, purchase history, and AI-powered targeting can offer suppliers increasingly sophisticated advertising opportunities connected directly to measurable outcomes.
This changes retail economics materially. In some cases, monetized attention and retail media infrastructure may become as strategically important as merchandise margin itself.
The competitive implications are significant. Retailers with scalable customer-data ecosystems gain new revenue streams, deeper supplier relationships, and stronger monetization opportunities. Retailers without strong data infrastructure risk falling behind in a retail environment where commerce, advertising, personalization, and AI increasingly converge.
Synthesis
Put these patterns together and Q1 2026 looks like a turning point where AI moved decisively closer to the money.
The most important shift is not automation itself. It is mediation. AI increasingly sits between consumers and retailers, influencing discovery, recommendation, merchandising visibility, loyalty, pricing perception, and eventually purchasing decisions themselves.
That creates enormous opportunity for retailers with strong operational foundations, trusted brands, loyalty ecosystems, first-party data, and reliable fulfilment infrastructure. It also creates substantial risk for retailers that become overly dependent on external platforms, fragmented systems, or AI layers they do not control.
The retailers most likely to succeed in the next phase of commerce are not necessarily those deploying the most AI tools. They are the ones capable of integrating AI into a broader operating model built around customer trust, operational discipline, data quality, and strategic control over the customer relationship.
Artificial Intelligence (AI) and retail. Image: redresscompliance.com
Editor’s Take
The biggest shift this quarter is that AI is becoming the shopping journey itself rather than simply a tool operating inside it.
Discovery, recommendation, merchandising, and increasingly checkout are moving into AI-assisted environments attached to platforms such as Gemini, ChatGPT, Instacart, Shopify, and connected commerce ecosystems. That changes the economics of retail in ways many operators may still underestimate.
The retailers best positioned today appear to be those building both the engine and the rails. Canadian Tire stands out for scaling MOSaiC with Microsoft while simultaneously strengthening Triangle through the RBC partnership. Loblaw is emerging as one of Canada’s most important AI-commerce case studies through its ChatGPT and Gemini integrations and broader push toward becoming what executives describe as an AI-native enterprise. Shopify remains well positioned as flexible commerce infrastructure for an increasingly fragmented discovery environment. Google is clearly advantaged as it pulls shopping behaviour into Gemini through retailer and platform partnerships.
The exposed side is less about individual companies and more about operating posture. Retailers with fragmented systems, weak data governance, poor personalization, limited operational discipline, or weak trust infrastructure may struggle as AI compresses the shopping funnel and platform ecosystems gain influence over discovery.
A debatable call is whether AI ultimately levels the playing field for smaller retailers or squeezes them harder. AI tools may reduce barriers to sophisticated merchandising, marketing, and customer engagement. However, if major platforms increasingly control discovery and recommendation systems, smaller retailers may still find themselves competing primarily on price, speed, and fulfilment efficiency.
What to watch next comes down to four developments. First, how quickly retailers clear foundational technology debt and move AI from pilot programs into repeatable operational systems. Second, whether consumers continue embracing AI-assisted purchasing while maintaining trust around pricing transparency, accountability, and data security. Third, how aggressively retail media ecosystems expand as retailers increasingly monetize customer attention and first-party data. Finally, watch how AI changes the balance between digital convenience and physical retail differentiation. As machine-mediated commerce becomes more common, differentiated human retail experiences may become more valuable, not less.
The practical takeaway for executives is increasingly clear: the next era of retail competition may be decided less by who owns the store and more by who controls the interface between consumer intent and purchase.
Q1 2026 reinforced a difficult reality for Canadian retailers: consumers are still spending, but they are increasingly behaving as though economic pressure is permanent rather than temporary.
The retail economy did not collapse during the quarter. Consumers continued buying groceries, dining out selectively, travelling in some categories, and shopping across both physical and digital channels. But the psychology behind the spending changed. Canadians increasingly appeared to shop defensively:
comparing prices more aggressively,
delaying discretionary purchases,
trading down strategically,
reducing basket sizes,
and reserving premium spending for purchases they considered emotionally or functionally worthwhile.
That shift matters because it changes how retailers operate.
The market is no longer dealing with a short-term inflation shock. Instead, businesses are adapting to an environment where elevated food costs, energy volatility, financing pressure, and consumer caution increasingly behave like permanent operating conditions rather than temporary disruptions.
Woman shopping at a grocery store in the produce aisle looking for vegetables. Photo: Statistics Canada
The strongest operators are adjusting accordingly:
protecting opening price points,
leaning harder into loyalty ecosystems,
emphasizing private label,
tightening assortments,
renegotiating supplier relationships,
engineering value perception,
and building more flexible operating models capable of absorbing volatility.
The pressure is becoming especially visible in the middle of the market.
Value-oriented operators continue benefiting from defensive consumer behaviour, while premium categories tied to experience, status, convenience, or emotional utility retain pockets of resilience. The middle, however, is becoming thinner. Businesses dependent on broad middle-market discretionary spending increasingly face consumers who still want to spend, but who now scrutinize nearly every purchase.
Canadian retail increasingly resembles a barbell economy where value and selective premium continue attracting spend while broad middle-market positioning faces growing pressure.
That divide shaped much of Canada’s retail economy during Q1 2026.
Executive Summary
Several themes defined Canada’s retail economy during Q1 2026:
Consumers continued spending, but increasingly behaved defensively and selectively.
Food inflation remained one of the most important pressures on household budgets.
Discount, value, and private-label strategies continued outperforming broader middle-market positioning.
Restaurants faced worsening margin pressure despite large nominal sales volumes.
Small businesses struggled with rising fuel, labour, financing, and operating costs.
Energy volatility increasingly threatened to reaccelerate food inflation later in 2026.
“Buy Canadian” sentiment encountered real pricing limitations at the shelf.
Operational flexibility and cost control became increasingly important competitive advantages.
The broader shift is becoming harder to ignore: Canadian retail is increasingly restructuring around volatility as a permanent operating condition rather than a temporary disruption.
Consumers Continue Spending, But With a Calculator
Retail Insider published 60 Retail Economy stories during Q1 2026, and the mix itself revealed a market increasingly focused on pressure management rather than expansion optimism.
The strongest themes were not rapid growth or aggressive expansion. Instead, the quarter was dominated by:
inflation management,
consumer caution,
pricing pressure,
operating costs,
tariffs,
energy volatility,
restaurant stress,
and affordability concerns.
Importantly, consumers did not stop spending altogether. Retail sales continued rising in nominal terms, while foodservice sales remained historically large in dollar value. But underneath those topline numbers, the consumer increasingly behaved differently:
smaller baskets,
more flyer shopping,
greater deal sensitivity,
fewer impulse purchases,
increased loyalty-app usage,
and more selective discretionary spending.
Statistics Canada’s retail sales data reinforced this distinction. Retail sales rose faster in dollar terms than in real volume terms, suggesting inflation continued masking softer underlying purchasing behaviour.
The consumer is still in the building. They are simply shopping with a calculator.
Shopping cart in a Canadian grocery store. Frozen goods. Dairy. Photo: RI/Google
Food Inflation Becomes a Structural Retail Problem
One of the quarter’s clearest themes was that food inflation increasingly behaved less like a temporary pricing shock and more like a structural operating reality.
Food inflation eased somewhat from earlier peaks, but grocery prices continued rising fast enough to pressure household budgets. Statistics Canada reported food purchased from stores rose 4.1% year-over-year in February and 4.4% in March 2026, reinforcing that grocery inflation remains stubbornly elevated even as headline inflation moderates.
That matters because food is not discretionary.
Consumers may postpone apparel purchases, reduce restaurant visits, or delay home projects. Grocery spending, however, remains unavoidable. When food inflation stays elevated while wage growth lags, consumers compensate elsewhere:
trading down,
reducing discretionary purchases,
shrinking basket sizes,
increasing flyer shopping,
and searching more aggressively for value.
The implications extend well beyond grocery.
If food absorbs a larger share of household spending, every other retail category increasingly competes for a smaller portion of wallet share. That creates pressure on:
mid-market discretionary retail,
casual dining,
impulse-driven categories,
and businesses dependent on spontaneous spending behaviour.
This also explains why value-oriented grocery formats, discount banners, and private label continue strengthening their position.
Metro and Loblaw both pointed to stronger discount-banner momentum and sustained consumer focus on value. Consumers are not simply reacting to one quarter of inflation. Increasingly, they appear to be restructuring how they shop altogether.
The middle of the market is thinning.
Defensive Shopping Reshapes Retail Strategy
One of the quarter’s most important changes was psychological rather than statistical.
Consumers increasingly behaved as though volatility, affordability pressure, and economic uncertainty were likely to persist.
That creates a different operating environment for retailers.
The challenge is no longer simply pricing merchandise correctly. Increasingly, retailers must manage:
value perception,
emotional affordability,
promotional cadence,
loyalty engagement,
basket psychology,
and consumer trust.
The strongest operators are becoming highly disciplined around what could be described as “value architecture”:
protecting opening price points,
emphasizing private label,
tightening assortments,
improving loyalty rewards,
reducing menu complexity,
and creating selective “affordable indulgence” moments that allow consumers to keep spending without feeling financially careless.
That distinction matters because consumers are not eliminating discretionary purchases entirely. Instead, they are becoming more selective about where emotional spending still feels justified.
Consumers still pay for:
convenience,
comfort,
familiarity,
experiences,
trusted brands,
and selective indulgence.
What they increasingly reject are purchases that feel financially careless, overpriced, or emotionally unjustified.
One of the quarter’s most important risks is that energy volatility is no longer merely a macroeconomic headline sitting outside retail operations.
Higher oil prices increasingly affect:
transportation,
refrigeration,
processing,
utilities,
fertilizer,
distribution,
and long-haul freight.
Q1 coverage repeatedly connected geopolitical instability and oil-price pressure to the risk of renewed food inflation later in 2026. Some forecasts suggested food inflation could accelerate back toward the 6%–8% range if energy prices remain elevated.
That possibility matters because retailers are already operating in an environment where consumers remain highly price-sensitive.
The operational implication is increasingly clear: businesses capable of absorbing volatility through scale, sourcing flexibility, distribution leverage, and stronger balance sheets hold a growing competitive advantage.
Smaller operators remain significantly more exposed to sudden swings in:
freight costs,
utility bills,
supplier pricing,
and inventory economics.
Retailers increasingly operate in continuous adjustment mode:
recalibrating pricing,
adjusting promotions,
reevaluating sourcing,
and managing constantly shifting cost structures.
Operational flexibility is becoming a retail survival skill.
Milestones (CNW Group/Foodtastic)
Restaurants Move From Recovery to Margin Compression
The restaurant industry increasingly looks less like a recovery story and more like a margin compression story.
Restaurants Canada warned that roughly 44% of operators were either losing money or merely breaking even heading into 2026. Projections also pointed toward the possibility of a net loss of thousands of restaurants nationally if cost pressures and weaker traffic persist.
What changed this quarter is that many of the temporary buffers supporting restaurants appear weaker:
pandemic rebound spending has normalized,
consumers are dining out more selectively,
alcohol consumption is softening,
tipping fatigue is becoming more visible,
and operators face structurally higher labour, food, occupancy, and financing costs.
This creates a difficult equation.
Restaurants continue generating large nominal sales totals, but topline growth increasingly masks profitability strain when inflation inflates menu prices faster than actual traffic growth.
Restaurants increasingly function as one of the clearest indicators of middle-market consumer pressure.
Consumers still dine out, but many are:
visiting less frequently,
ordering more selectively,
skipping add-ons,
reducing alcohol purchases,
or gravitating toward value-oriented formats.
That distinction matters for landlords, lenders, and suppliers.
If independents absorb a disproportionate share of the pressure, the implications extend beyond hospitality itself:
weaker neighbourhood traffic,
reduced local differentiation,
higher turnover risk,
and more fragile leasing environments.
For landlords, the commercial decision increasingly becomes whether to prioritize short-term occupancy or long-term tenant resilience.
Yorkdale Shopping Centre in Toronto, 2025. Photo: Craig Patterson
Small Business Confidence Weakens
Small business confidence deteriorated meaningfully during the quarter as operators faced the combined pressure of:
softer demand,
higher fuel costs,
rising operating expenses,
financing strain,
and ongoing uncertainty.
CFIB’s long-term confidence index fell sharply in March, while concerns around fuel, shipping, and demand all increased.
This matters because small business weakness affects more than individual operators. It affects:
hiring,
inventory depth,
local leasing activity,
store openings,
community retail vibrancy,
and supplier ecosystems.
When independent businesses lose confidence, they generally become:
more conservative,
slower to expand,
quicker to cut costs,
and more cautious about inventory and staffing commitments.
That creates structural advantages for larger operators with:
stronger balance sheets,
better financing access,
more supply-chain leverage,
and greater pricing flexibility.
Retail churn may not yet look catastrophic nationally, but the market is showing increasing signs of fragility beneath the surface.
A sign encouraging shoppers to buy Canadian products at a liquor store in Vancouver on Feb. 2, 2025. Shoppers have been caught up in the buy Canadian fervour since U.S. President Donald Trump began threatening to apply tariffs on imports from Canada. THE CANADIAN PRESS/Ethan Cairns
“Buy Canadian” Encounters Price Reality
One of the quarter’s most revealing themes was the tension between patriotic purchasing intent and shelf-price reality.
Consumers may publicly support “Buy Canadian” messaging, but Q1 reporting repeatedly suggested many shoppers still default to value when price gaps become meaningful.
That creates a practical challenge for Canadian brands and retailers.
Patriotism may influence purchasing decisions at the margin, but it rarely overrides sustained affordability pressure, especially when food and household costs remain elevated.
This changes the strategic conversation around domestic sourcing.
Retailers and suppliers increasingly need to ensure Canadian positioning is paired with:
credible pricing,
clear value communication,
appropriate pack sizes,
and visible affordability.
Consumers may want to support local businesses, but they still operate within household budget constraints.
That means domestic sourcing advantages will likely remain strongest where:
pricing gaps stay manageable,
quality differentiation is visible,
or emotional connection justifies premium pricing.
Goodwill alone is unlikely to sustain long-term consumer trade-offs in a high-cost environment.
Risks to the Retail Economy
Several risks could further pressure the retail economy during the second half of 2026.
These include:
renewed energy inflation,
tariff escalation,
weakening consumer confidence,
restaurant failures,
rising debt stress,
and continued affordability fatigue.
One of the largest risks is psychological exhaustion.
Consumers have spent several years adapting to inflation, higher interest rates, and economic uncertainty. The longer volatility persists, the greater the risk that households eventually reduce spending more aggressively rather than continuing to absorb incremental price increases.
There is also risk that discount and value-oriented retail becomes increasingly crowded as more operators reposition around affordability messaging.
At the same time, many businesses continue operating with thinner buffers after years of inflationary pressure. Even modest additional shocks tied to fuel, tariffs, freight, or financing could create disproportionate operational stress.
The strongest businesses will likely be those capable of remaining flexible while protecting consumer trust and value perception simultaneously.
Halifax Shopping Centre. Photo: Primaris REIT
Editor’s Take
The biggest shift in Q1 2026 is that inflation increasingly stopped behaving like a temporary crisis and started behaving like a permanent operating condition.
That changes retail decision-making fundamentally.
Retailers are no longer simply waiting for costs to normalize. Increasingly, they are restructuring around the assumption that:
volatility will persist,
consumers will remain cautious,
pricing pressure will continue,
and affordability sensitivity will remain elevated.
The strongest operators are adapting accordingly:
emphasizing value,
protecting opening price points,
strengthening loyalty ecosystems,
expanding private label,
tightening operations,
and building more resilient supply chains.
The weakest players are becoming increasingly exposed:
middle-market discretionary retailers,
independent restaurants,
small businesses with limited pricing power,
and operators dependent on stable input costs.
One of the quarter’s most important themes is that Canadian consumers did not stop spending. They changed how they justify spending.
Consumers still pay for:
convenience,
emotional comfort,
trusted brands,
experiences,
value,
and selective indulgence.
What they increasingly reject is spending that feels financially careless or emotionally unjustified.
That distinction may define the retail economy for the remainder of 2026.
Canadian retail is no longer adapting to temporary disruption. It is restructuring around the expectation that caution, volatility, and value sensitivity may define consumer behaviour for years rather than quarters.
Canadian Books & Entertainment increasingly behaved less like a traditional retail category and more like a competition for attention, participation, and emotional engagement during Q1 2026.
The category is no longer moving in one direction. It is increasingly splitting into two different economies competing for the same consumer time and discretionary spending.
One side of the market is built around participation. These businesses monetize engagement, fandom, repeat visits, social interaction, and emotional connection. Consumers are paying for experiences, community, premium outings, collectibles, gaming culture, and culturally relevant moments. In these models, the venue itself increasingly becomes part of the product.
The other side remains tied to older specialty retail structures built around static inventory, seasonal peaks, and conventional merchandising. That side of the market is showing mounting pressure as occupancy costs, supply-chain complexity, digital competition, and shifting consumer behaviour continue reshaping the economics of physical retail.
The divide became difficult to ignore during Q1.
Steve’s Music in downtown Montreal. Photo: Steve’s Music
Steve’s Music moved into liquidation across much of its network to focus on a single Montreal flagship and e-commerce operations.
At the same time, operators built around recurring participation continued expanding.
Cineplex continued lifting revenue-per-guest through premium formats, concessions, alternative programming, subscriptions, loyalty, and location-based entertainment. Activate Games expanded its replayable technology-enabled entertainment model, while Splitsville Bowl continued growing large-format venues built around bowling, food, beverage, arcades, and group experiences.
On the commerce side, eBay launched livestream shopping in Canada tied directly to fan conventions, while Funko reset Canadian wholesale distribution through Kroeger Marketing. These moves reinforced another structural shift emerging across the category: fandom, collectibles, and entertainment commerce are increasingly being driven through events, livestreams, communities, creator ecosystems, and digital participation rather than passive shelf merchandising.
For retailers, landlords, investors, vendors, brokers, and service providers, the implication is becoming clearer. The traditional Books & Entertainment playbook weakens fastest when stores fail to evolve into destinations, community nodes, or recurring-visit experiences.
Executive Summary
Several themes defined Canadian Books & Entertainment during Q1 2026:
Experiential entertainment operators continued outperforming traditional specialty retail.
Landlords prioritized tenants capable of extending dwell time and generating repeat visits.
Traditional specialty retail faced renewed financial pressure and restructuring risk.
Entertainment increasingly merged with hospitality, foodservice, and social activity.
Livestream commerce and fandom-driven retail ecosystems accelerated.
Consumers continued spending selectively on premium outings, identity-driven purchases, and culturally relevant experiences.
Community-building and participation became increasingly important competitive advantages.
The broader shift is becoming difficult to ignore: Canadian Books & Entertainment increasingly rewards operators that monetize emotional engagement and participation rather than simply selling inventory.
Books & Entertainment Becomes a Participation Economy
Retail Insider tracked 9 notable Books & Entertainment stories during Q1 2026, and the mix itself revealed a category moving in two directions simultaneously.
Expansion and experiential growth occurred alongside restructurings, liquidations, shrinking footprints, and operational stress. This was not a stable category. It was a quarter where consumers gravitated toward outings, fandom, experiences, and event-driven spending while some traditional retail formats struggled under rising costs and declining visit urgency.
The strongest operators increasingly shared one characteristic: they created reasons for consumers to actively participate rather than simply transact.
That participation showed up through:
premium cinema experiences;
immersive gaming;
bowling entertainment;
collectibles;
conventions;
livestream commerce;
fandom events;
creator ecosystems; and
social outings.
The weaker side of the category looked very different:
static inventory;
fragile supply chains;
declining visit urgency; and
retail models dependent on nostalgia rather than recurring engagement.
Books & Entertainment is no longer functioning purely as a specialty retail category. It is increasingly operating as a participation economy where emotional utility, repeat engagement, and community matter as much as merchandise itself.
(RENDERING OF THE NEW PARK ROYAL CINEPLEX VIP CINEMAS. IMAGE SUPPLIED)
Consumers Increasingly Pay for Emotional Utility
One of the most important shifts underneath the category is that consumers increasingly justify experiences differently than products.
Commodity purchases are increasingly easy to make online. Physical Books & Entertainment retail now competes more heavily on:
escapism;
identity;
belonging;
social interaction;
memory creation;
participation; and
cultural relevance.
That helps explain why fandom, gaming, collectibles, entertainment, and social experiences continue attracting consumer attention even as broader discretionary spending remains selective.
The strongest operators are no longer simply selling products or admissions. They are creating environments where consumers feel part of something.
That distinction matters.
Retailers capable of building emotional engagement, rituals, repeat participation, and community behaviour are becoming more resilient. Operators dependent primarily on transactional visits are becoming more exposed to digital substitution and traffic volatility.
Participation has become a retail moat.
What We’re Hearing Across the Market
Several themes repeatedly surfaced across landlord discussions, retailer activity, earnings commentary, and Q1 reporting.
Landlords increasingly value entertainment tenants because they:
extend dwell time;
activate evenings and weekends;
support surrounding restaurant traffic;
encourage family and group outings; and
create repeat visitation patterns that many traditional retailers struggle to replicate.
There are also signs that entertainment and fandom-driven uses are replacing weaker discretionary retail categories in some centres. Collectibles, gaming, anime, trading cards, and social entertainment concepts continue generating stronger engagement than many inventory-heavy specialty formats.
Meanwhile, retailers tied to organized communities appear more resilient than operators dependent on broad generic assortment strategies. Release calendars, tournaments, livestreams, creator partnerships, exclusive drops, and conventions increasingly function as recurring traffic infrastructure rather than isolated marketing moments.
The strongest operators increasingly behave less like conventional retailers and more like entertainment, media, hospitality, and community platforms.
Entertainment Becomes Traffic Infrastructure
One of the quarter’s most important real estate shifts is that entertainment tenants are increasingly functioning as traffic infrastructure within Canadian retail environments.
For years, entertainment was often treated as supplementary to shopping. That is changing quickly. Entertainment is increasingly central to how landlords drive:
The strongest entertainment operators no longer rely solely on admissions or transactional purchases. They monetize engagement time through:
food and beverage;
premium upgrades;
memberships;
loyalty;
replayability;
group events;
merchandise; and
social participation.
Cineplex continues demonstrating this model through premium screens, VIP offerings, alternative programming, concessions, subscriptions, and location-based entertainment. Even where attendance remains tied to film slates, revenue-per-patron metrics continue reinforcing the value of premiumization and experiential layering.
Activate Games operates around repeat participation through replayable technology-enabled rooms, progress tracking, and social competition. Splitsville Bowl similarly monetizes group occasions through bowling, VIP lanes, food, beverage, arcades, and event-driven social experiences.
This convergence between entertainment, hospitality, and foodservice is becoming increasingly important for landlords. Entertainment venues no longer function purely as attractions. In many cases, they help stabilize traffic patterns, extend visit duration, support restaurant ecosystems, and create reasons for consumers to physically gather.
Entertainment tenants are increasingly being underwritten more like traffic infrastructure than discretionary retail.
Activate opens in Oslo, Norway and Gothenburg, Sweden
Fandom Becomes Recurring Traffic Infrastructure
Another major shift emerging from the quarter is that fandom itself is becoming organized retail infrastructure.
Collectibles, gaming culture, anime, trading cards, creator ecosystems, sports partnerships, livestreams, and convention culture are no longer operating at the edge of retail. They are increasingly functioning as recurring demand ecosystems capable of generating urgency, loyalty, repeat visits, and community participation.
Retail Insider’s Q1 coverage reflected this shift through:
eBay Live Canada;
EB Games Canada’s Canadian Soccer Business partnership; and
broader collectibles momentum.
The earnings commentary reinforced the same pattern.
eBay pointed to momentum in:
trading cards;
comic books;
collectibles;
live commerce; and
authenticated marketplace activity.
For Canadian operators, the implications are becoming increasingly practical.
Retailers can no longer simply stock fandom. They increasingly need to program fandom through:
events;
tournaments;
drops;
livestreams;
creator partnerships;
pre-orders;
conventions;
loyalty ecosystems; and
recurring community participation.
The store is no longer simply a distribution point.
It is becoming:
a stage;
a gathering place;
a social venue; and
a community platform.
Omnichannel Evolves Into Event Commerce
In Books & Entertainment, digital increasingly functions less like a checkout lane and more like a live event platform.
eBay Canada’s launch of eBay Live tied livestream auctions directly to convention culture and fan moments, including Fan Expo Vancouver. The significance extends beyond auctions themselves. Live commerce transforms scarcity, fandom, urgency, and participation into real-time retail behaviour.
This changes the competitive environment for specialty retail.
A local collectibles retailer may still possess strong community credibility, but it now competes against platforms capable of:
staging live events;
integrating influencers;
driving national audiences;
creating urgency; and
publicly establishing pricing momentum in real time.
The broader lesson extends beyond collectibles.
Passive e-commerce and generic online assortment are becoming weaker competitive advantages than:
owned audiences;
creator ecosystems;
loyalty platforms;
app engagement;
livestreams;
event calendars; and
community participation.
Retailers increasingly need reasons for consumers to engage before the transaction itself occurs.
Liquidations Put Real Estate Back in Play
The immediate implication for landlords and brokers is increasingly straightforward: vacancy and repositioning risk remain meaningful across parts of the category.
Steve’s Music represents one version of that pressure. Its retreat toward a single Montreal flagship and e-commerce operation reflects how difficult it has become for some traditional specialty formats to support broad physical networks without stronger experiential differentiation.
This creates broader implications for malls, power centres, and urban retail corridors.
Entertainment, gaming, foodservice, fandom retail, and social experiences are increasingly being evaluated not as optional additions, but as strategic traffic drivers capable of stabilizing visitation patterns within increasingly experience-oriented retail environments.
The next wave of category growth is unlikely to come from conventional inventory-led specialty retail. It is more likely to come from operators capable of generating participation, social engagement, repeat visitation, and stronger productivity economics.
Risks to the Thesis
Despite strong momentum behind experiential and fandom-driven retail, several risks remain important.
One risk is oversupply. If every landlord aggressively pursues:
immersive gaming;
bowling entertainment;
social attractions;
arcades; or
experiential concepts,
certain markets could eventually become saturated.
Another risk is novelty fatigue. Some experiential concepts remain heavily dependent on repeat traffic and social relevance. Maintaining long-term engagement may become more difficult once novelty cycles fade.
Consumer spending also remains selective. Experiences may currently be outperforming some traditional retail categories, but they remain discretionary purchases vulnerable to broader economic softness.
There is also increasing competition for consumer attention itself. Livestreams, fandom ecosystems, collectibles, conventions, gaming, and entertainment concepts are all competing for finite time and spending capacity.
The strongest operators will likely be those capable of consistently refreshing experiences, building communities, and maintaining cultural relevance rather than relying purely on novelty.
Photo: eBay
Editor’s Take
The biggest shift this quarter is that Canadian Books & Entertainment increasingly rewards operators that create participation rather than passive consumption.
That sounds subtle, but it represents a major structural shift in how consumers engage with physical retail.
The strongest businesses are no longer simply selling products, admissions, or inventory. They are building ecosystems around:
fandom;
identity;
social interaction;
repeat engagement;
events;
loyalty; and
cultural relevance.
That is why operators such as Cineplex, Activate Games, Splitsville Bowl, eBay Live, and fandom-driven collectibles ecosystems continue generating momentum.
The weaker side of the category increasingly looks exposed:
static merchandising;
fragile supply chains;
weak digital engagement; and
formats dependent on nostalgia rather than recurring participation.
The broader implication may extend well beyond Books & Entertainment itself.
Consumers increasingly want reasons to leave home:
social interaction;
identity;
experiences;
community;
events;
escapism; and
emotionally resonant participation.
Retailers capable of creating those behaviours are becoming more resilient.
Those that remain primarily transactional are becoming more exposed.
For landlords, the lesson is increasingly straightforward: underwrite traffic quality, repeat engagement, and dwell time rather than relying purely on legacy category assumptions or nostalgic brand recognition.
In 2026, success in Books & Entertainment increasingly depends less on what retailers sell and more on whether consumers feel compelled to return, participate, and belong.
Canada’s retail real estate market entered 2026 facing a contradiction: retailers still want stores, but increasingly struggle to secure economically viable space in the locations they want most.
The market is no longer defined by recovery. It is increasingly being defined by scarcity.
Prime retail availability remains extremely tight across major Canadian markets. Landlords continue reporting high occupancy, rising renewal spreads, and strong tenant demand, particularly in grocery, value, service, fitness, wellness, luxury, and necessity-driven categories. At the same time, rising construction costs, elevated build-out expenses, tighter capital conditions, and longer development timelines are reshaping how retailers approach expansion.
The challenge is no longer proving demand exists. The challenge is converting demand into profitable, affordable, buildable space.
That tension defined Canadian retail real estate during Q1 2026.
Former Hudson’s Bay locations are becoming some of the country’s largest redevelopment and subdivision opportunities. Owners are actively repositioning large-format boxes into mid-sized leasing opportunities while using redevelopment flexibility to rethink tenant mix, intensification, and long-term site planning. Meanwhile, older retail assets without clear reinvestment strategies are becoming increasingly exposed as debt costs, redevelopment complexity, and capital requirements rise.
The result is a market behaving less like a traditional growth cycle and more like a scarce-resource economy.
Sunridge Mall in Calgary. Photo: Tourism Calgary
Executive Summary
Several themes dominated Canadian retail real estate during Q1 2026:
Prime retail availability remained historically tight in major Canadian markets.
Former Hudson’s Bay locations became Canada’s largest mid-box leasing opportunity.
Landlords continued pushing renewal and new leasing spreads materially higher.
Rising build-out and development costs placed increasing pressure on retailer economics.
Grocery, value, fitness, service, wellness, and necessity retail categories remained strongest.
Landlords with redevelopment capital widened their competitive advantage.
Retailers became more selective, flexible, and data-driven in expansion planning.
Adaptive reuse and mixed-use intensification accelerated across older retail assets.
Second-generation space became increasingly attractive relative to expensive new development.
The quarter also reinforced a broader structural shift: retail real estate strategy is increasingly becoming capital strategy. In 2026, choosing a site also means choosing a balance sheet.
Q1 2026 by the Numbers
Several metrics illustrated how constrained the Canadian retail real estate market has become:
98.6% RioCan committed retail occupancy
25.8% RioCan blended leasing spreads
58.5% RioCan new leasing spreads
$175 million–$225 million expected Primaris investment into former Hudson’s Bay repositioning projects
15 million square feet of former Hudson’s Bay space analyzed by JLL
65% projected Hudson’s Bay absorption within two years through subdivision and re-tenanting strategies
97.6% SmartCentres committed occupancy
58 Retail Insider real estate and leasing stories published during Q1 2026
These are not indicators of a weak leasing environment. They are indicators of scarcity.
Retail Real Estate Moves Beyond Recovery
Retail Insider’s Q1 coverage revealed a market increasingly focused on optimization rather than broad expansion.
The industry conversation shifted away from pandemic recovery and toward more structural concerns:
how to reposition large-format vacancy,
how to justify rising occupancy costs,
how to intensify aging retail assets,
and how to deploy capital efficiently in a market where development economics have fundamentally changed.
That shift is visible across Canada.
In Toronto, dominant nodes such as Yorkdale Shopping Centre, Bloor-Yorkville, Ossington Avenue, and CF Toronto Eaton Centre continue experiencing intense competition for space. Vancouver remains defined by luxury demand concentrated around Alberni Street and the emerging Oakridge Park retail district, where more than 30 luxury brands are expected to open stores over time. Calgary and broader Alberta markets continue benefiting from population growth and suburban expansion momentum, particularly in grocery-anchored and necessity-oriented formats.
The issue is not whether retailers want Canadian space. The issue is whether enough viable space exists in the locations retailers actually want.
What We’re Hearing Across the Market
Several themes repeatedly surfaced across earnings calls, leasing discussions, brokerage commentary, and Retail Insider reporting during the quarter.
Retailers are becoming materially more cautious about expansion economics, even while continuing to pursue growth. Many are prioritizing:
second-generation space over expensive new shell construction,
flexible footprints,
phased openings,
and lower-cost build-out opportunities.
At the same time, landlords are becoming increasingly selective about tenant mix and covenant quality. Grocery, fitness, wellness, value retail, food, medical, pet, and service-oriented tenants continue attracting strong landlord interest because they generate repeat traffic and stronger long-term property productivity.
There are also signs that some discretionary retailers are quietly becoming more hesitant about aggressive expansion, particularly in expensive urban corridors where occupancy costs, fixturing expenses, and construction pricing have materially increased over the past several years.
Meanwhile, competition for well-located mid-box space appears to be accelerating faster than many landlords initially expected following the collapse of Hudson’s Bay.
Retail space is still available in Canada. Economically viable retail space is becoming much harder to secure.
Hudson’s Bay flagship store in downtown Vancouver on Wednesday, May 28, 2025. Photo: Lee Rivett
Former Hudson’s Bay Space Becomes Canada’s Largest Leasing Opportunity
The collapse of Hudson’s Bay has created one of the most significant retail real estate repositioning opportunities Canada has seen in decades.
JLL estimates roughly 65 percent of former Hudson’s Bay space could be committed within two years, largely through subdivision strategies that transform oversized department store boxes into smaller, leasable mid-format spaces.
That shift matters because many modern retailers no longer want massive legacy department store footprints. Instead, they want:
15,000–40,000 square foot spaces,
better visibility,
more efficient layouts,
lower operating costs,
and locations within already-proven trade areas.
Primaris REIT is effectively betting on that thesis at scale. The company is preparing to invest between $175 million and $225 million repositioning former Hudson’s Bay locations while also unlocking redevelopment flexibility previously constrained by legacy department store agreements.
This is becoming the new landlord playbook:
subdivide oversized anchors,
upgrade tenant mix,
improve traffic quality,
and reposition existing assets rather than waiting for traditional department store replacements that may never return.
Some of the strongest leasing opportunities in Canada over the next 24 months may emerge from spaces that currently look transitional and construction-heavy rather than polished and stabilized.
The next leasing opportunity may arrive disguised as a redevelopment problem.
Rising Rents Are Colliding With Retail Economics
The strongest landlords in Canada continue benefiting from significant pricing power.
RioCan’s Q1 leasing spreads reinforced how constrained prime Canadian retail space has become, with new leasing spreads reaching 58.5 percent.
But rising rent is only one layer of the equation.
Retailers are simultaneously facing:
elevated construction costs,
higher fixturing expenses,
more expensive financing,
labour shortages,
permitting delays,
and rising operating costs.
For many retailers, especially discretionary and mid-tier concepts, the issue is no longer simply securing a location. The issue is whether the economics still work once construction, staffing, occupancy, and capital costs are fully modeled.
That creates an important contradiction in the market.
Landlords continue pushing rents higher because space remains scarce. However, retailers still need stores to remain profitable. If occupancy costs move too far ahead of store productivity, the market risks creating hidden fragility beneath today’s strong occupancy metrics.
This is particularly relevant in categories such as:
discretionary fashion,
independent restaurants,
experiential retail,
and highly customized flagship concepts with expensive build-outs.
Retailers are no longer simply competing for customers. Increasingly, they are competing for viable economics.
Queens Harbour, under construction. Photo: Craig Patterson
Construction Costs Are Reshaping Expansion Strategy
Canada continues building retail space, but the threshold for development has materially increased.
Public REIT commentary increasingly reflects a more disciplined development environment:
projects tied closely to leasing commitments,
phased development,
selective intensification,
and targeted capital deployment rather than broad speculative expansion.
That matters because rising development costs are narrowing future supply.
The market increasingly favours:
second-generation space,
adaptive reuse,
former anchor subdivisions,
and mixed-use intensification.
Retailers capable of operating flexible formats now hold a meaningful advantage.
Brands able to efficiently adapt to:
5,000 square feet,
12,000 square feet,
or 25,000 square feet, using modular fixtures and lower-cost build-outs have materially more flexibility than concepts dependent on expensive flagship prototypes.
This is becoming increasingly visible across Canadian expansion activity. Retailers are becoming more selective about where flagship investments still make sense, while simultaneously pursuing lower-risk suburban, mixed-use, and second-generation opportunities.
The non-obvious implication is that construction inflation is not simply inflating budgets. It is reshaping retail strategy itself.
Landlords With Capital Are Pulling Ahead
Capital access has become one of the defining competitive advantages in Canadian retail real estate.
The former Hudson’s Bay situation illustrates this clearly. Demand for many locations exists, but landlords still require substantial capital to:
subdivide space,
modernize infrastructure,
improve visibility,
reconfigure loading,
and reposition aging assets.
Landlords capable of funding these projects are creating opportunity. Owners facing debt pressure or limited redevelopment capacity are becoming more exposed.
Dixie Outlet Mall’s receivership reinforced this reality. A retail property can remain active, operational, and occupied while still facing financial pressure if the capital structure no longer works.
The divide between well-capitalized owners and weaker operators is likely to widen further over the next several years.
Passive retail ownership is becoming increasingly risky.
Dixie Outlet Mall. Photo: Trip Advisor
Adaptive Reuse Moves From Trend to Necessity
Adaptive reuse has increasingly shifted from theory to commercial necessity.
Older malls and large retail parcels now represent some of the country’s most valuable serviced land within established communities facing housing shortages and intensification pressure.
The issue is no longer whether mixed-use redevelopment will happen. The issue is which properties can realistically execute it.
Leading landlords are already leaning into:
residential intensification,
mixed-use redevelopment,
entertainment uses,
service-oriented merchandising,
healthcare integration,
and adaptive reuse planning.
The strongest owners are repositioning retail properties into broader mixed-use ecosystems rather than relying solely on traditional shopping centre formats.
For retailers, this creates both opportunity and uncertainty. Redevelopment clauses, shorter lease terms, phased construction, parking changes, and shifting access conditions are becoming increasingly common realities.
The exposed assets are those stuck in the middle:
not dominant enough to command premium rents,
but not advanced enough in approvals, financing, or redevelopment planning to evolve quickly.
Winners and Pressure Points
Winners This Quarter
Grocery-anchored retail real estate
Mid-box subdivision strategies
Landlords with redevelopment capital
Alberta suburban retail markets
Luxury and premium urban corridors
Necessity-driven retail categories
Second-generation leasing opportunities
Pressure Points
Mid-tier discretionary retail
Older enclosed malls without redevelopment strategies
High-buildout restaurant concepts
Retailers facing aggressive lease renewals
Capital-constrained landlords
Large-format boxes dependent on outdated merchandising models
Risks to the Thesis
Despite strong leasing fundamentals, several risks could weaken the market’s current trajectory.
These include:
softer discretionary consumer spending,
retailer insolvencies,
financing stress,
redevelopment delays,
construction inflation,
and over-aggressive rent growth.
The market also risks becoming overly optimistic about redevelopment timelines. Former department store boxes remain large, capital-intensive projects requiring:
patient leasing,
substantial construction work,
phased execution,
and significant redevelopment expertise.
Not every landlord will execute successfully.
There is also a risk that some “healthy” retail properties are currently being protected by limited alternatives rather than genuinely strong long-term economics.
The strongest evidence of resilience remains concentrated among dominant, well-capitalized assets rather than the market as a whole.
Editor’s Take
The biggest shift in Q1 2026 is that Canadian retail real estate is increasingly behaving like a scarce-resource economy.
But underneath those fundamentals sits growing friction:
space scarcity,
rising rents,
construction inflation,
expensive capital,
and tightening store economics.
The market remains healthy, but it is becoming materially less forgiving.
The strongest landlords are those with:
redevelopment capital,
disciplined merchandising strategies,
data-driven leasing,
and the ability to actively reposition assets.
The strongest retailers are becoming more selective, more flexible, and more operationally disciplined.
The weakest players are increasingly exposed:
older assets without clear redevelopment plans,
retailers dependent on outdated store economics,
and operators hoping demand alone will solve structural issues.
One of the most important shifts may be psychological. For years, Canadian retail real estate discussions centred around recovery, e-commerce disruption, and store closures. In 2026, the conversation has increasingly shifted toward scarcity, redevelopment, and capital efficiency.
That does not mean every retail asset wins. It means the market is becoming more polarized.
The long-term story is no longer simply retail recovery.
It is scarcity:
not enough prime space,
not enough easy development,
not enough cheap capital,
and not enough simple anchor replacements.
That scarcity will continue shaping Canadian retail real estate long after the immediate Hudson’s Bay disruption fades.
For executives, the practical takeaway is increasingly straightforward: in 2026, retail real estate decisions are balance-sheet decisions.
Rokt, the New York-based e-commerce technology company that will power more than 10 billion transactions in 2026, has spent years building a corporate culture where the stated philosophy is to hire people who challenge you to be better. That’s the story Dan Wright tells about working at Rokt for nearly a decade.
Dan Wright’s Decade at Rokt: Fourteen Teams, One Constant
Wright is currently VP of Operations and Solutions at Rokt, and his career there is an unusual case study in what internal mobility actually looks like when a company is scaling fast. Over nearly ten years, he has worked for, founded, or been part of fourteen different teams at Rokt, a breadth that gives him a different vantage point on the company than most employees develop. The thing that stands out to him isn’t the change. It’s what hasn’t changed.
“What I’m really proud of and always have been over the last ten years is what hasn’t changed,” Wright said. “That’s the culture and the people.”
The consistency he’s describing has a direct effect on how he hires. In a recent feature on Rokt’s blog, Wright explained the philosophy he has carried across every team he’s built: hire the person who is better than you. Build a team of people who are stronger than you in many aspects, and you end up with a great team.
The Jon Humphrey Story: A Hiring Philosophy Made Concrete
The clearest illustration of that philosophy is a story Wright has told about hiring Jon Humphrey about four years ago as a Director of Solutions. Six months into the role, Wright was sitting in a performance calibration meeting with Rokt’s executive leadership team. When it came time to start Humphrey’s review, he opened with what he described as a half-joke: “I think I’ve just hired my boss.” The room laughed. Wright didn’t walk it back.
“No, I’m serious,” he told the room. “I think Jon within the year is going to be my boss.”
He was right. Humphrey became VP of Operations and Solutions within a year. He is now SVP of Operations and Advertising. “He’s just absolutely skyrocketed,” Wright said. “For me, I think it’s one of the proudest things I’ve done at Rokt, being involved in Jon’s success.”
The story is a specific, verifiable example of something Rokt’s culture pages and award write-ups tend to describe more abstractly: that the company promotes quickly, measures leaders by the growth of their direct reports, and doesn’t treat internal advancement as a threat to the person who did the hiring.
Recognition as an Organizational System, Not a Program
Rokt’s approach to employee recognition goes beyond milestone gifts and shout-outs at all-hands meetings, though it has those too. According to Built In’s 2026 company culture profile, Rokt uses structured awards tied directly to its core values, including a Values Champion award and an Impact Award that highlight individuals and teams for demonstrating the company’s principles and delivering measurable results. Spot bonuses and milestone gifts mark onboarding, work anniversaries, and life events. Practices like gratitude rounds and “recent wins” segments are embedded into regular team meetings rather than treated as separate recognition activities.
What makes the system notable is the organizational logic behind it: recognition at Rokt is designed to make contributions visible beyond the immediate team. Cross-department shout-outs, company-wide acknowledgment from senior leaders, and recognition through digital platforms are all part of a deliberate effort to surface work that might otherwise remain invisible. For a company that has grown from roughly 313 employees in 2021 to more than 500 by 2024, keeping contribution visible across a scaling organization is an active management challenge, not a solved problem.
Third-Party Validation: What the Awards Actually Measure
The external recognition Rokt has received is meaningfully different from the kind companies self-report. Great Place To Work, which bases its certification on direct employee surveys rather than company submissions, reports that 91% of Rokt employees describe it as a great place to work, compared to 57% at a typical U.S. company. Rokt has held Great Place To Work certification for five consecutive years.
These aren’t rankings that companies can purchase or petition for. The Built In awards are based on employee data. The Fortune list relies on confidential surveys. When companies appear on lists like these repeatedly, the external validation is a signal of something consistent happening internally, not a one-time performance.
A High-Change Environment With a Stable Core
Rokt describes itself as a high-change environment, and that framing shows up in how employees talk about working there. A current employee with more than five years at the company described watching Rokt grow from 200 to 800 people, with advancement opportunities and the chance to grow alongside the business.
The tension between high standards and sustainable pace is one Rokt has addressed directly. Rokt’s 2026 Built In award write-up noted that the company’s July 2025 internal engagement survey showed 88% of employees said Rokt provides equal opportunity regardless of age, race, gender, or sexual orientation; a six-point increase from the prior year’s 82%. Internal promotion rates remain above 10% annually, well above industry averages, according to Built In’s workplace profile.
The company also invests $100 million annually in product innovation, according to Rokt’s own performance data. Over the past decade, it has maintained a compound annual growth rate above 40%. Between 2021 and 2024, revenue grew from $97 million to $418 million, a 330% increase. That growth rate earned Rokt the #87 overall ranking on the Financial Times list of The Americas’ Fastest Growing Companies 2026, a list compiled by the Financial Times and Statista that identifies companies with the strongest verified revenue growth between 2021 and 2024.
What “Builder DNA” Means in Practice
Rokt refers to its employees as “Rokt’stars” and uses the term “Builder DNA” to describe the mindset it hires for. According to Built In’s innovation and technology profile of the company, Rokt made a deliberate decision to give every employee access to the full suite of AI tools the company licenses rather than gating access by role or seniority. One employee described the shift as watching “a collective effort to democratize access to tooling and information” unlike anything they had seen in their career.
The company runs an annual company-wide hackathon, the Rokt’athon, which in 2025 focused on building AI-powered solutions to real business problems — not hypothetical proposals, but working products developed by cross-functional teams under time pressure. That’s a meaningful design choice. A culture that produces working products under time constraints in a 48-hour sprint is different from one that produces strategy documents and presentations.
The flat organizational structure Rokt describes, with wide spans of control and minimal hierarchy, is the structural counterpart to that approach. When leadership is accessible, and decision-making is fast, it’s possible for someone like Jon Humphrey to be hired as a director and become an SVP within a few years. That kind of trajectory requires an organization willing to move quickly on people, and a hiring philosophy that actively looks for talent above its own level.
Why the Culture Story Matters at Scale
Rokt now operates in 17 global markets and serves more than 33,000 active clients, including more than half of the largest global e-commerce companies by volume. At that scale, culture is an execution variable, not a branding exercise. The company’s ability to sustain 40%-plus growth over more than a decade depends on continuously bringing in and developing people capable of running parts of the business that didn’t exist two years earlier.
Dan Wright’s story is a small-scale version of that dynamic. He’s been part of fourteen teams because the company keeps building new ones. He has hired people who became his boss because the company keeps creating the senior roles that make that possible. He has stayed for nearly a decade, in part, because the culture that existed when he joined is still the culture he recognizes today.
That consistency, at a company growing as fast as Rokt, is not an accident. It’s the product of a deliberate organizational system; one built around promoting talent it recognizes, recognizing contributions it might otherwise miss, and rewarding the leaders who make it possible by measuring them on what the people they hired go on to do.
666 Queen St. W. in Toronto. Photo: Julie SEO (broker who listed the property, no broker on the tenant side of the lease deal)
Vivobarefoot is opening its second Canadian store on Toronto’s Queen Street West as barefoot-style footwear continues gaining momentum among consumers seeking a blend of wellness, performance, and fashion.
The British footwear brand will open at 666 Queen Street West in the former Oak + Fort space, marking the company’s biggest Canadian expansion move since entering the market with a Kitsilano store in Vancouver roughly three years ago. The Toronto location, expected to open June 20, will span approximately 1,200 square feet.
For Andrew Bentley, who holds the exclusive Canadian distribution rights for Vivobarefoot, Toronto represented the obvious next step as awareness around minimalist footwear continues to grow.
“There’s a natural pull toward Toronto,” Bentley told Retail Insider in an interview. “It’s one of North America’s leading cities, and people here understand fashion, wellness, and new consumer trends.”
Andrew Bentley
Bentley said the Queen West location was selected because of the area’s combination of fashion-conscious consumers, strong pedestrian traffic, and wellness-oriented demographic, particularly around nearby Trinity Bellwoods Park.
The company also saw similarities to Kitsilano in Vancouver, where Vivobarefoot established its first Canadian physical retail presence.
“It’s a community where people care about health and movement, and they’re willing to invest in those things,” Bentley said.
Toronto Store Builds on Vancouver Momentum
Bentley said the Vancouver store helped demonstrate that Canadian consumers were increasingly open to footwear concepts that combine function, lifestyle, and fashion.
“We’ve continued to see double-digit growth from the Vancouver store,” he said. “A large percentage of customers are still discovering the brand for the first time, which tells us there’s growing awareness around the category.”
The Kitsilano location has also become a destination for travellers already familiar with Vivobarefoot internationally, reinforcing the role physical retail can play for brands built around education and customer experience.
Bentley recalled one family visiting from Mexico City who FaceTimed relatives while shopping in the store before ultimately purchasing about a dozen pairs of shoes.
Founded in 2012 by Galahad and Asher Clark, members of the Clarks footwear family, Vivobarefoot has built a global following around minimalist footwear designed with flexible soles, wide toe boxes, and an emphasis on more natural movement. The company is also B Corp certified and has developed sustainability initiatives focused on repair, refurbishment, and resale.
Bentley said the Toronto location will become the company’s second concept store in North America. A New York City location is also planned for the Soho area.
Vivobarefoot at 2190 W 4th in Kitsilano, Vancouver (Image: Vivobarefoot)
Physical Retail Remains Important for the Category
While Vivobarefoot continues expanding online and through wholesale partnerships across Canada, Bentley said physical retail remains important because many consumers are still unfamiliar with barefoot footwear and want in-person guidance before making a purchase.
“The category still requires education,” he said. “People want to understand what makes the product different and how it’s meant to function.”
Vivobarefoot currently works with several wholesale partners in Canada, including retailers in Toronto, Ottawa, and Saskatoon.
The Toronto store is expected to host fittings, community events, and movement-focused programming as the company works to build awareness around the category.
That approach reflects a broader shift among wellness and performance brands toward experience-driven retail environments that emphasize community and education alongside product sales.
Vivobarefoot at 2190 W 4th in Kitsilano (Image: Vivobarefoot)
Minimalist Footwear Gains Wider Attention
Bentley believes barefoot footwear is increasingly moving beyond its traditional niche audience as athletes, wellness consumers, and fashion shoppers become more aware of the category.
“We’re seeing barefoot footwear evolve into a category of its own,” he said.
He pointed to growing adoption among professional athletes and sports organizations, including NHL players and training programs that incorporate minimalist footwear into conditioning and rehabilitation routines. Bentley also noted that larger fashion companies have recently introduced minimalist-inspired footwear products, which he views as further validation of the category’s growing visibility.
At the same time, Vivobarefoot continues emphasizing sustainability as part of its broader brand strategy.
“There are billions of pairs of shoes entering landfills every year,” Bentley said. “We want to think differently about how footwear is made, repaired, reused, and kept in circulation longer.”
The company operates refurbishment and resale initiatives internationally through its “Revivo” platform and has introduced “ReLoved” programs in Canada designed to extend the lifecycle of footwear products. Vivobarefoot is also exploring customized production concepts, including foot-scanning technologies and more localized manufacturing approaches aimed at reducing waste.
Vivobarefoot flagship store in London UK. Photo: Vivobarefoot
Montreal Identified as a Potential Next Market
Although the company remains focused on establishing its Toronto store, Bentley acknowledged that additional Canadian expansion opportunities are already being considered.
“Montreal is definitely a market we’re interested in over the longer term,” he said.
For now, however, Toronto represents an important milestone for the company as Vivobarefoot looks to expand awareness of barefoot-style footwear within Canada’s largest retail market.
“We want to create products that feel natural while still being stylish enough for everyday life,” Bentley said. “That balance is a big part of what Vivobarefoot is about.”
adidas is taking over STACKT Market this summer, transforming the downtown Toronto site into a month-long World Cup fan destination featuring giant watch parties, retail pop-ups, food programming, music, and interactive soccer experiences tied to the 2026 FIFA World Cup.
Running from June 11 through July 19, the “Home of Soccer” takeover will span more than 25,000 square feet near Toronto Stadium (BMO Field) and the city’s FIFA Fan Festival area, positioning STACKT as one of Toronto’s major gathering places for soccer fans throughout the tournament.
The initiative comes as brands, restaurants, retailers, and tourism operators increasingly position themselves around what is expected to be one of Toronto’s biggest international events in decades.
Giant Watch Parties and Soccer Challenges
At the centre of the adidas installation will be a massive outdoor screen measuring 13.5 feet by 24 feet, broadcasting every World Cup match throughout the tournament period.
Organizers say the venue will accommodate up to 1,200 visitors daily, with admission operating on a first-come, first-served basis. Large crowds are expected for marquee international matches, particularly as soccer fandom continues growing across Canada ahead of the World Cup.
One of the main attractions will be the “Strike Lab,” where visitors can test adidas Predator and F50 soccer boots while tracking shot speed on a live leaderboard.
The takeover is also expected to include appearances from adidas athletes and brand ambassadors during the residency, though specific names have not yet been announced.
Alongside the soccer programming, adidas will introduce an “adidas Studio” featuring rotating experiences such as barber services, hair braiding, temporary tattoos, and hair dye customization on select dates.
Retail, Product Drops, and Personalization
Retail will play a major role throughout the site.
The temporary adidas store will feature official World Cup merchandise, national team kits, tournament-inspired apparel, and limited-edition footwear launches tied to the global event.
Fans will also be able to personalize purchases onsite and create customized Panini x adidas cards designed for collectability and social sharing.
adidas is also leaning heavily into customization and interactive experiences, areas that have become increasingly important for sportswear brands seeking to engage younger consumers in physical retail environments.
The takeover also comes as global sportswear companies intensify marketing efforts ahead of the World Cup, with adidas continuing to expand its visibility in Toronto through flagship stores, partnerships, and large-scale public events.
STACKT Market Continues to Grow as Cultural and Retail Destination
The choice of STACKT Market is significant from both a retail and real estate perspective.
Built from repurposed shipping containers on a former industrial site west of downtown Toronto, STACKT Market opened in 2019 and quickly became one of the city’s most visible destinations for pop-ups, food concepts, concerts, festivals, and branded public events.
The open-air complex regularly hosts retail installations, wellness programming, live entertainment, and cultural events aimed at younger urban audiences. Its flexible layout and outdoor gathering spaces also make it well suited for large-scale public viewing events tied to major international moments such as the World Cup.
Located near Toronto Stadium and the waterfront, the venue is expected to benefit from increased visitor traffic throughout the tournament period.
For adidas, the environment aligns closely with the kind of immersive consumer experiences global brands are increasingly prioritizing as retail, entertainment, hospitality, and live events continue to overlap.
Food Programming and Tournament Atmosphere
Food and beverage offerings will form a major part of the “Home of Soccer” concept.
Local vendors and chefs including Rob Bragagnolo and Joseph Shawana are expected to create menus inspired by the international nature of the tournament, while a dedicated beer garden will allow fans to gather for match viewings throughout the event schedule.
No advance registration will be required for entry, though organizers are encouraging guests to arrive early for high-profile matches because of anticipated demand.
During the World Cup, STACKT Market is expected to become one of Toronto’s busiest gathering places for soccer fans as the city embraces the tournament atmosphere this summer.
