Despite global uncertainty, Calgary’s retail market continues to show remarkable stability, with growth in rental rates and a low vacancy rate, according to Ron Odagaki, Associate Vice President of Retail at JLL.
In an interview with Retail Insider, Odagaki emphasized that Calgary’s retail sector remains resilient and poised for future growth, thanks to a combination of stable consumer spending and ongoing migration into the city.
“The retail market in Calgary, both historically and today, has been relatively stable,” said Odagaki. “We’re currently seeing a vacancy rate of under 4%, and the market has certainly stabilized. We’re still seeing rental growth and absorption, and we’re also witnessing more development as new retail spaces and shopping centres come online.”
Odagaki pointed out that the ongoing trend of net migration to Alberta is a key factor driving the demand for new retail developments. As new residents flock to the province, they bring with them an increased demand for housing and, consequently, new retail spaces to serve these communities.
“We’re seeing new inventory coming online, new shopping centres, and new retail spaces being built,” Odagaki explained. “That’s a strong signal for the market. It’s closely tied to the continued net migration into Alberta and Calgary. New residents mean new housing, and new retail follows to meet their needs.”
Even amid global uncertainties, such as tariffs, Odagaki noted that consumer spending remains stable, reflecting a healthy retail real estate market in Calgary. The overall outlook for the retail sector is positive, with signs of growth and further development on the horizon.
According to the JLL’s report on Canada’s Retail Market Dynamics:
- About 1.6 million square feet were absorbed in 2024, higher than in 2023, with greater net absorption in general retail. Construction starts remain subdued, continuing to tighten the market.
- Available space has dropped 60 basis points to 2.8 percent and asking rents continue to rise, although at a slower pace than the national average.
- About 1.2 million square feet of leases were signed in 2024. This is in line with the five-year average leasing volume, and demonstrates signs of post-pandemic stabilization.
Food Services Sector Thrives in Calgary
Another sector of Calgary’s retail landscape that continues to thrive is food services, with a growing number of restaurants and food chains expanding in the city. According to Odagaki, this trend is driven by the city’s strong restaurant culture and Calgarians’ high level of spending on dining out.
“Calgarians spend 44% of their food budget on restaurants and fast food, which is one of the highest in the country and certainly above the Canadian average,” said Odagaki. “The growth in restaurant spending, both fast food and sit-down, is also among the highest in Canada.”
While some may question whether the market has become saturated, Odagaki believes that demand for new food services continues to rise. He explained that new entrants, inquiries, and store openings in the food services sector are still increasing in Calgary.
“Restaurateurs are seeing the data, and they recognize that there is still a market for new food services,” said Odagaki. “We’re still seeing new entries and announcements of new stores opening. The demand is there, and the market is absorbing it.”
Experiential Dining Remains Popular
Odagaki also highlighted the growing trend of experiential dining in Calgary, where food plays a central role in creating memorable experiences for consumers. This shift toward experiential dining, he explained, is driving the continued success of Calgary’s food services sector.
“There’s a strong pent-up demand for experiential offerings,” Odagaki said. “Calgarians love to sit down with friends in an atmosphere where they can enjoy a great meal. Food plays a big part in that, and it continues to be a popular trend in Calgary.”
As Calgary’s retail market remains dynamic and continues to evolve, Odagaki remains optimistic about the future of both retail and food services in the city. With continued population growth, a thriving food culture, and stable consumer spending, Calgary is well-positioned to weather global uncertainties and remain a vibrant retail hub.
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