Toronto-based Cadillac Fairview has put CF Shops at Don Mills up for sale, offering investors the opportunity to acquire one of Canada’s best-known open-air shopping centres as the company continues a long-term strategy of concentrating its portfolio around its most productive retail assets and highest-growth opportunities.
The 30-acre property, located at the southwest corner of Don Mills Road and Lawrence Avenue East in Toronto, comprises 580,153 square feet of gross leasable area and is home to 111 tenants. The shopping centre is being marketed by TD Cornerstone Commercial Realty and CBRE Toronto’s National Investment Team, which described the offering as a “generational opportunity to acquire a high-quality shopping centre with stable in-place cash flow and long-term upside potential.”
According to marketing materials, the centre generates approximately $665 in tenant sales per square foot and benefits from an affluent trade area with average household income of about $171,000.
The property is anchored by tenants including Metro, McEwan Fine Foods, Cineplex Cinemas, LCBO, RBC, TD, Anthropologie, Structube and Eataly. Other notable retailers include Aritzia, Sephora, Joey Restaurants, Chick-fil-A and Chipotle.
A Pioneering Lifestyle Centre
CF Shops at Don Mills opened in 2009 on the site of the former Don Mills Centre, becoming one of Canada’s earliest large-scale open-air lifestyle shopping centres. At the time, the project represented a significant departure from the enclosed regional mall format that had dominated Canadian retail development for decades.
The centre combined shopping, restaurants, entertainment and public gathering spaces in an urban village setting and helped establish the lifestyle centre concept in Canada.
Cadillac Fairview later partnered with FRAM Building Group and Lanterra Developments on residential projects surrounding the shopping centre, including Rodeo Drive, Flaire and LIV Lofts, helping create a mixed-use community around the property.
In 2017, Cadillac Fairview completed a $21-million renovation that included upgraded pedestrian spaces, enhanced landscaping, new public art and expanded entertainment areas.
Another Step in Cadillac Fairview’s Portfolio Evolution
The proposed sale comes amid a period of significant portfolio repositioning by Cadillac Fairview, the wholly owned real estate subsidiary of the Ontario Teachers’ Pension Plan.
Over the past two years, the company has sold several major shopping centres, including CF Champlain in Greater Moncton, CF Fairview Park in Kitchener, CF Lime Ridge in Hamilton and CF Promenades St-Bruno in Quebec. Earlier this year, Cadillac Fairview also sold a 50 per cent non-managing interest in CF Masonville Place in London while retaining management of the property.
Taken together, the transactions suggest an increasingly focused portfolio optimization strategy centred on a smaller number of flagship assets that generate some of the highest sales productivity levels in Canada.
Retail Advisor Antony Karabus believes the proposed sale of Shops at Don Mills fits squarely within that strategy.
“Different mall owners clearly have very different strategies,” Karabus said in an interview with Retail Insider.
“CF’s shopping centre strategy clearly is to build and optimize the most productive modern malls that cater to the biggest-spending retail customers.”
Karabus described Shops at Don Mills as an “orphan” within Cadillac Fairview’s portfolio, arguing that the open-air centre no longer aligns with the company’s focus on highly productive, transit-oriented shopping centres in major urban markets. Further, the open-air nature of the asset brings a whole different set of complexities and creating challenges to motivate customers to shop there for the many months of winter and rainy weather in Toronto
“It’s just for a different mall owner, it would be a good asset. For CF, it doesn’t fit into their portfolio strategy,” he said.
A Different Position in the Toronto Market
Karabus noted that Shops at Don Mills occupies a different position in the market than some of Cadillac Fairview’s flagship properties and nearby competitors.
Unlike nearby enclosed shopping centres such as CF Fairview Mall and Bayview Village, the property lacks direct rapid transit access and primarily serves customers arriving by automobile and bus. The surrounding neighbourhood is affluent but remains relatively low density compared with some of Toronto’s major urban shopping districts.
The centre’s tenant sales productivity of approximately $665 per square foot is well below that of Cadillac Fairview’s highest-performing assets, many of which generate more than $1,000 per square foot in tenant sales.
At the same time, Karabus emphasized that the proposed sale should not be interpreted as a reflection of weakness at Shops at Don Mills itself.
“It’s not a bad asset,” he said. “It’s just not the right asset for Cadillac Fairview.”
His comments also reflect broader changes within Canadian retail, where a K-shaped economy has increasingly favoured top-performing luxury and premium retail destinations while value-oriented and necessity-based centres have also performed strongly.
Significant Long-Term Redevelopment Potential
While the existing shopping centre continues to generate stable cash flow, the property’s long-term redevelopment potential may prove equally attractive to prospective buyers.
Marketing materials indicate that an additional 752 condominium units and 407 purpose-built rental apartments are proposed within the existing mixed-use village surrounding the shopping centre.
The offering memorandum also highlights the possibility of substantially greater intensification in the future. Preliminary planning concepts envision the eastern portion of the site along Don Mills Road eventually accommodating more than 2,800 additional residential units.
The scale of that opportunity suggests that investors may be evaluating the property as both an operating shopping centre and a long-term land play in one of Toronto’s most affluent neighbourhoods.
Karabus believes meaningful redevelopment remains years away given the current challenges and much reduced demand in the multi-family real estate sector but says the property could appeal to an owner with different investment objectives and return expectations than Cadillac Fairview.
As shopping centre owners across Canada increasingly look to unlock value through mixed-use intensification, the future owner of Shops at Don Mills may ultimately see opportunities extending well beyond the existing retail footprint.
Ultimately, the proposed sale appears to be less a commentary on the shopping centre itself and more another sign of Cadillac Fairview’s continuing effort to optimize its retail portfolio around a smaller number of flagship assets with the highest productivity and growth opportunity.
For a new owner, however, the property may represent something entirely different: a stable cash-flowing retail asset, a substantial land holding in one of Toronto’s most affluent communities, and a long-term opportunity to shape the next chapter of one of Canada’s pioneering lifestyle centres.
