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Downtown Edmonton Retail Struggling Amid New Developments and Shifting Dynamics [Feature Story/Interviews]

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Edmonton’s downtown core can be described these days as a tale of two cities.

On the one hand, the spanking new Ice District, with Rogers Arena, hotels, condos and office buildings, can be a hub of activity, particularly when events are taking place in the arena.

But on the other hand, just a few blocks away, literally a stone’s throw distance, exists a completely different reality with an area overtaken by homeless and street people and some nefarious activity – and lots of space open for retail leasing.

Some people have described certain parts of Edmonton’s core as a ghost town over the past two years as the pandemic has had a huge impact with many people not going to work in the downtown offices – a key in any downtown’s vibrancy.

But there is some hope that the situation will get better when more people return to the office towers in a post-pandemic recovery.

Edmonton City Centre (Image: Just Click It Youtube)

Craig Patterson, CEO and Publisher of Retail Insider and also an Advisor at the University of Alberta Centre for Cities and Communities in Edmonton, has studied the Canadian retail landscape for the past 25+ years.

“I’ve been watching downtown Edmonton decline for a number of years. It’s really unfortunate,” he said. “I would say in the 1990s downtown Edmonton was actually a fairly vibrant area that had a grocery store in the basement of Edmonton Centre which is now part of Edmonton City Centre. There were several department stores – Eaton’s, Hudson’s Bay, Woodward’s, Holt Renfrew. Now downtown Edmonton is almost a ghost town at this point.

Craig Patterson

“We’ve really seen a decline in foot traffic as well as a decline in overall space in the downtown core of Edmonton. At one time there were several other shopping centres in the downtown core and almost all of them have shut down and in a couple of cases been re-commissioned to non-retail space. It’s pretty incredible.”

Patterson said part of the reason is the nature of the city of Edmonton – a very suburban city in terms of being automobile dependent with a large segment of the population more likely to be shopping in suburban centres. There’s a cost to downtown parking. The downtown also has a perception for many that it is not safe. It has struggled with the issue of vagrancy. Also, there’s a lack of vibrancy on the sidewalks.

“One of the many issues is the design of downtown Edmonton. Jasper Avenue (which in the past was home to some major retailers) saw many of the smaller, commercial buildings that were pedestrian friendly in terms of the way that the retail was set up, they were demolished for large office towers and even though retail space was put into these office towers it wasn’t of the same small scale that would be attractive to pedestrians which I think has led to an increased lack of vibrancy and as a result this deserted downtown core that we see today in most parts of downtown,” explained Patterson, adding that the centre of the city has continued to shift north with the development of Manulife Place, Edmonton City Centre and now the ICE District.

“Downtown Edmonton is going to really have to clean itself up because the condition of the downtown core for the most part has become disheveled. It hasn’t seen updates in investment that would make it attractive, certainly compared to the suburban shopping centres which continue to see investments.

“It’s going to be a really tough time for downtown Edmonton not having the retail attraction that you would see in the suburban shopping centres in the Edmonton market. There’s very little reason for people to go to downtown Edmonton other than for a sports game or to go to work in an office if they’re back to work there.”

ICE District in Downtown Edmonton (Image: Colliers International and Savills)

In an email Sean Kirk, General Manager of Edmonton City Centre, described the property as a 1.4 million-square-foot, multi-use property consisting of retail, office, and parking facilities. Currently there are 63 retail tenants open at Edmonton City Centre that offer a broad variety of goods and services.

Pre-pandemic, the Centre had 106 retail tenants. Much of the reduction was a result of regional/national tenants that went dark chainwide during the pandemic, and their closure at Edmonton City Centre was an unfortunate by-product, he said.

Sean Kirk

“Edmonton City Centre is right in the centre of the downtown community and, along with all other office and retail landlords in the downtown core, have been managing the increase in members of this community that are struggling with a variation of mental health issues, addictions, and/or houselessness. In partnership with Paladin Security and Boyle Street Community Services, we have been working on evolving our current security programme with the addition of new innovative projects to ensure a safe and vibrant shopping experience” said Kirk. 

“Some programmes have already commenced and have had very positive feedback on its effectiveness. We expect to build this initial success with the introduction of additional initiatives in the weeks and months ahead. We are also working with several industry organizations, the Edmonton Police Service, the City, and members of all levels of government to support broader downtown vibrancy initiatives.  Ultimately, this is a broader societal issue we see in urban cores across North America, and it requires a collective effort from all public and private parties to resolve.

“Well before the pandemic, the retail industry was already experiencing a structural change in consumer shopping habits, retail trends, and the influence of social media. These last two years have only accelerated that change. The entire industry faces a unique challenge of rejuvenating the in-person shopping experience. I don’t think we are alone in needing to reimagine portions of the experience, but I’m confident in the strength of customers who still appreciate the accessibility, immediacy, and social enjoyment of shopping in-person.”

Edmonton (Image: JLL)

Moving forward into a post-pandemic recovery, Kirk said he was optimistic that there will be strong recovery in the downtown core – and it is already experiencing increased foot traffic and an increase in leasing inquiries.

“Along with our traditional retail offerings, we’ll be focusing on introducing new experiential, health and wellness, and food and beverage concepts to broaden our Centre’s appeal. Being innovative and creative in our mix and offerings will always be a key strategy for our shopping centre. Maintaining a welcoming and inviting environment for all will continue to contribute to the success of our Centre,” he said.

“Given its size, there’s always opportunities to introduce additional uses and functions to Edmonton City Centre. This could certainly include additional densification, and it will certainly be considered as part of the overall modernization plan we’re currently working through. Ultimately, market conditions will dictate what we do and when we do it.”   

Michael Kehoe, a commercial real estate broker with Fairfield Commercial Real Estate in Calgary and a spokesperson for Consumer Real Estate Canada, said many cities in Canada are struggling with their downtown central business districts in the post-pandemic period. 

Michael Kehoe

“Retail sales and consumer footfall have been slow to recover due to a variety of economic, employment related trends and social issues. This is particularly evident in downtown Edmonton where a ‘perfect storm’ of such factors is negatively impacting retail venues in a visible way. Civic officials, law enforcement leaders, social agencies and stakeholders in the built environment have a significant challenge ahead not only in Edmonton but in cities across the country,” said Kehoe.

“The situation in downtown Edmonton has been compounded with the development of the government incentivized ‘Ice District’ with its restaurants, entertainment venues and hotels that competes directly with many businesses in the downtown core. Civic politicians and city planners have to be asking ‘What would Jane Jacobs the author of The Death and Life of Great American Cities do to address these challenges’?”

Jane Jacobs was an American-Canadian journalist, author, theorist, and activist who influenced urban studies, sociology, and economics. 

Downtown Edmonton (Image: REALTOR)

Paul Raimundo, Vice President, Retail for commercial real estate firm JLL, said when COVID hit everyone vacated the core for a long period of time and Edmonton is just starting to see some resurgence of people back to the downtown.

That has helped activity. It’s vastly better than it was six months ago and it’s getting better every day.

“As the people started disappearing, the mall became a refuge for a lot of the homeless people because it is connected to our light rail transit and that was a place for them to stay warm, that was a place for them to make sure they had space. When you don’t have as many people downtown and you see that being the predominant fixture there, it becomes a very big focal point for a lot of the retail leasing people and landlords here at the office tower. They’re trying to work with the city. There is a number of the office buildings that have a little bit of a group that they’ve created as landlords to talk about security in the downtown core,” he said.

Paul Raimundo

“Everybody who owns buildings in the core is very, very cognizant of what is taking place. Going forward, there is some really good momentum in downtown in general. Predominantly it’s with people back. Without people back, nothing can be accomplished. We’re starting to see some good retail re-jigging . . . The actual mall itself is embarking on a large redevelopment. They are looking at redeveloping the west side of this project where the Bay used to be. I think you’re going to start to see that take a little more shape over the next 12 to 24 months where their plan is going to become very clear.”

The Ice District will also be seeing the opening of a new Loblaws City Market in the near future.

“As we turn the corner at the end of summer, I fully anticipate a much stronger fall as it relates to consumers in the downtown core,” added Raimundo.

Future Loblaws City Market at ICE District (Image: Ice District)

May Cuan, Associate, Retail with Omada Commercial in Edmonton, said there is a lot of positive momentum and month over month there are more people in the downtown. 

May Cuan

“Whether it’s for work, events, to eat and shop, etc. it’s been great to see more bodies in the core. We’re not at pre-pandemic levels of downtown leasing activity yet, but I’m excited for the Fall, when more people are back from holidays and less people are working from home and are back in the office,” she said. “As retail businesses notice an increase of people back in the downtown, we notice an increase of interest from these businesses considering a location here once again. A couple examples of prominent downtown leasing activity include The Helm relocating to a larger flagship location in the downtown, which is a positive indication of a business choosing to remain near the core, and El Furniture Warehouse, a restaurant group with locations across Canada, which selected the downtown for their first Edmonton location.   

“It’s a challenging situation, especially in certain areas that see an increase in vagrancy, but this has been a consideration for the downtown retail sector before the pandemic as well. What I mean is that it’s not a new challenge. I believe that this concern would also be alleviated with more people and activity back in the downtown, and I get the sense that retail businesses are positive that we’re turning a corner on this front.”

Image: Edmonton Downtown Business Association

Puneeta McBryan, Executive Director at Edmonton Downtown, said the characterization of the downtown being a ‘ghost town’ was accurate for 2020 and most of 2021, but she added that the NHL playoffs was a bit of a turning point in many ways with more people coming to the core to watch the Oilers. Also at the same time, office occupancy was increasing from about 20 per cent prior to the spring to about 40 per cent in June.

Puneeta McBryan

The challenge of Edmonton’s downtown is that some pockets have a lot of activity going on but there are also some pockets that are really still quite empty.

“We’ve got blocks where developers are sitting on properties either lots where they’ve torn down the building and the lot is just sitting there undeveloped or buildings that are slated for redevelopment, they’ve got plans and they’re taking the time, and these buildings are unfortunately just sitting there quite devoid of activity. That type of thing is definitely a challenge for us now,” she said. 

“The combination of this really tragic trajectory that the mall itself has kind of been on in the past three years, and that’s pre-COVID, combined with the really deserted state of downtown during COVID that really ushered in quite a lot of homeless population spending time in the area.”

But it’s getting better, added McBryan. Hosting events in the downtown is a key to adding vibrancy. The return to office work will help as well. The addition of a grocery store in Ice District is also a positive. Increasing residential density is also important. 

Article Author

Mario Toneguzzi
Mario Toneguzzi
Mario Toneguzzi, based in Calgary, has more than 40 years experience as a daily newspaper writer, columnist, and editor. He worked for 35 years at the Calgary Herald covering sports, crime, politics, health, faith, city and breaking news, and business. He is the Senior News Editor with Retail Insider in addition to working as a freelance writer and consultant in communications and media relations/training.

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2 COMMENTS

  1. Downtown Edmonton even more than downtown Winnipeg suffers from a sort of Potemkin village syndrome. It presents an impressive site from afar, but at street level amongst the buildings, it’s all rather sleepy and seedy. Perhaps, the West Edmonton Mall didn’t quite eat the metro’s retail scene as was predicted, but it certainly finished off downtown. Most retailers coming to the Edmonton market, especially the upscale ones, choose WEM. And if not there, then Southgate, maybe Whyte Avenue-Old Strathcona, or made-for-the-automobile South Edmonton Common. As people quoted in the article suggested, Edmonton was hit by that perfect storm of factors that urban areas across Canada also suffered in the last few years. Toronto, Montreal, and Vancouver had many of the same problems of vagrancy, vacancy, coronavirus shutdowns, and urban decline but unlike Edmonton, they benefited from being the seat of historic institutions and major commercial entities that created a critical mass of economic activity. In the case of Montreal and Toronto, the bulk of the urban core was built prior to the automobile age and established a dense, walkable pattern of urban development and adjacent, populous desirable districts that persist to this day. Vancouver, benefitting from its exceptional setting and its status as a major port of entry and commercial centre on the pacific rim was more easily able to maintain the attraction of its downtown even as suburbia sprawled over the delta and across the Fraser Valley to lap at the foothills of the mountains. Edmonton was a smaller, younger city that didn’t experience its boom until the post WW-II era of low-density automobile oriented development characterized by strip centers and leapfrogging subdivisions. The thickly settled medium density neighborhoods that surround central Montreal and Toronto were never able to get a foothold there. The wide open prairie setting didn’t sustain the culture of urban living found in the constricted, picturesque setting of downtown Vancouver on its peninsula studded with condominium towers. The high rises came with the oil boom, but they were connected to parking lots and garages instead of bustling urban neighborhoods. Leaders in the city’s business and academic community along with its municipal authorities have recognized Downtown Edmonton has reached the bottom of a trough. It’s encouraging to see them work together to save their city. There’s already a good foundation in the strand of parks along the river valley, the light rail system, new amenities such as ICE District, and the trickle of new business that have opened. In the video showing a drive through the downtown streets, I couldn’t help but notice among the tall, glassy towers all the vacant lots and surface parking. That’s all potential. The biggest challenge would be to establish the city centre as a place to live and not simply to work and get the hell out at 5 PM. If the movers and shakers can get that ball rolling, the retailers will follow.

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