In today’s video, we’re diving into the shifting landscape of Canadian retail with insights from Michael Kehoe, broker of record at Fairfield Commercial Real Estate in Calgary. Kehoe describes 2025 as a year defined by sharp contrasts, where strong-performing shopping centres coexisted with major disruption across the sector. According to him, trade tensions, economic uncertainty, and widespread department store closures created what he sees as a pivotal moment for retail real estate in Canada.
Kehoe explains that the closure of legacy department stores, including Hudson’s Bay, doesn’t just represent store shutdowns, but signals the end of the traditional department store model as Canadians once knew it. He notes that this has left millions of square feet of vacant space nationwide, including massive downtown flagship buildings like Calgary’s former Bay store. While absorption of this space will take years, Kehoe points out that many top-tier malls are already thriving without department store anchors, supported by strong foot traffic and evolving tenant mixes.
He also highlights how these vacancies are opening the door to reinvention, from subdivided retail units to mixed-use redevelopment, residential, hospitality, and urban-format large retailers. On the consumer side, Kehoe observes that shoppers remain cautious, driving growth at the value end of the market, alongside the rise of thrift, discount, and quick-service restaurant concepts. Together, these trends, he says, are reshaping Canadian retail in real time.
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