Calgary’s retail scene is on the cusp of significant change as major space closures from the Hudson’s Bay Company (HBC) shake up the market. With the impending closure of several Hudson’s Bay stores, Calgary could soon see nearly one million square feet of retail space become available, marking a generational shift in the local commercial real estate landscape.
Michael Kehoe, Broker of Record with Fairfield Commercial Real Estate Services, recently discussed the seismic impact of these closures on Calgary’s retail market. According to Kehoe, the closures present a unique opportunity for property owners to repurpose large retail spaces and adjust to changing market dynamics. In the case of malls like CF Chinook Centre, Southcentre, CF Market Mall, and Sunridge Mall, landlords face the challenge of filling large, empty spaces left behind by departing department stores like HBC, a task reminiscent of the years-long effort to repurpose Sears’ space at Southcentre Mall.
However, Kehoe views this transition not as a problem, but as an exciting opportunity. “It’s not just about filling the space; it’s about reimagining these properties,” he says. The focus is shifting toward creating mixed-use developments with higher density, incorporating residential, commercial, medical, and even office spaces to meet the evolving needs of modern consumers. Kehoe highlights the rise of transit-oriented developments and the demand for diverse, innovative uses within these spaces.
The decline of the traditional department store, once the cornerstone of malls, is a sign of broader shifts in consumer preferences. The experience-driven nature of retail is now top of mind, with entertainment, dining, and lifestyle-focused offerings increasingly becoming the centerpiece of successful retail developments. Kehoe notes that Canadian developers are well-known globally for their ability to adapt and innovate, ensuring that retail spaces will continue to evolve.
The Bay’s iconic flagship store in downtown Calgary, located at the heart of the city, is another example of this trend. The building, which sits on nearly six acres of prime real estate, has already seen four of its six floors repurposed for non-retail uses. Kehoe predicts that the building will likely see more food service and retail offerings integrated into its spaces, which will further contribute to the vibrancy of downtown Calgary.
The ongoing redevelopment of downtown, including projects like Arts Commons, the Glenbow Museum, and the Contemporary Calgary Art Gallery, is also expected to complement these changes. Kehoe believes that the repurposing of the Hudson’s Bay Building will be a key part of the transformation, adding to the city’s growing appeal.
With a variety of exciting developments on the horizon, Kehoe sees this period as an opportunity for both developers and the city of Calgary to embrace innovation, ensuring that the retail and commercial real estate markets remain dynamic and relevant for years to come.
Related Retail Insider stories:
- Oberfeld Snowcap to Monetize Hudson’s Bay Leases
- Hudson’s Bay Collapse Marks Shift for Legacy Retail
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Interesting times for sure, at West Edmonton Mall when Sears closed they brought in a Toyota Dealership. It is a neat idea to have a dealership in a mall for people to kill time while waiting for someone’s shopping. Maybe go shopping while you get an oil change.
Haven’t seen other malls with a dealership and I wounder if it would be viable at other places.
It certainly could work for some centres. Tesla took over an entire floor of a former department store at CF Limeridge in Hamilton, ON (which was recently vandalized).