The Calgary retail market is maintaining stability amid shifting demand, according to a recent report by commercial real estate firm Avison Young.
Retail fundamentals in Calgary remain steady, with demand anchored by population growth, evolving consumer preferences, and strategic mixed-use development, said the report.
Key trends from the report:
- Calgary’s economy remains resilient amid national economic headwinds, supported by a strong labour market, sustained population growth, and continued strength in the energy sector. In the retail sector, demand remains healthy, with grocery-anchored and service-based retailers performing well. New developments are limited, leading to tighter availabilities in desirable nodes, while evolving consumer preferences continue to drive demand for experiential and convenience-based retail formats;
- The rollout of federal–provincial childcare funding has provided relief of up to $30,000 for childcare programs through federal grants; however, it has fueled quick absorption of the available commercial real estate suitable for conversion. Market dynamics have shifted: there is a growing prevalence of non-profit and preschool-only operators over traditional full-day, forprofit models—especially those requiring outdoor space. From a leasing standpoint, inquiries and leads from traditional childcare tenants have noticeably declined due to provincial grant caps;
- Recent enforcement trends by the Competition Bureau have placed increased scrutiny on exclusivity clauses and restrictive covenants in retail leases. These provisions are now considered presumptively anticompetitive, particularly when they involve broad geographic scope, indefinite terms, or protections favoring dominant tenants—conditions that may substantially lessen competition in local markets. While grocery anchors have been the primary focus, these guidelines apply across all retail sectors, signaling a broader shift in regulatory oversight impacting property controls and leasing strategies.
“Overall, retail remains a top asset for investment and its potential for rents and scalability. As population and markets continue to grow, the need for essential retail and leisure will follow,” said Avison Young.
“From its highest point in 2020 – due to the pandemic – vacancy has largely recovered and is steadily increasing as more retail space comes online. Inventory is expected to grow in the coming few years with several large-scale projects under development. Transportation and ease of access is expected to remain a key tenet for retail expansion.”
As of mid-2025, Calgary had 64,218 thousand square feet of retail space under construction. The total retail inventory is projected to grow by nearly 0.15% by year-end, driven by the delivery of new community retail hubs and mixed-use developments, noted the report.
“While retail rents in Calgary have been trending upward, the city has also transitioned to a premium market, above the national average. This shift reflects the market’s efforts to deliver new product over the past few years alongside steady business growth. With significant highquality inventory slated for delivery, rents are expected to continue rising in line with ongoing economic momentum and tenant demand,” it said.
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