Canadians love their malls and their shopping habits could spur a mall-building boom, according to a new report by Colliers International, reports the Financial Post. The report compares spending per square foot in the U.S. and Canada, and concludes that Canada could use a few more malls:
…the country still has a far lower retail square footage per capita than the U.S. market does, making it a ripe growth opportunity for U.S. retailers and international property developers alike.
While the average mall performance in the U.S. was slightly above US$400 per square foot in 2011, Canadian malls yielded an average of nearly US$600 in sales per square foot. Fuelled by a stronger Canadian dollar, Canadian consumers’ retail spending per capita has essentially caught up to U.S. consumers, a trend that began in 2008.
But placing the U.S. as a benchmark has its problems. South of the border, malls are actually shrinking. If anything, since the recession started in 2008 it has become painfully obvious that a country only needs so many shopping malls.
This piece in The Economist illustrates the fate many malls in American suburban areas are facing. They’re being turned into office spaces, because retailers are long gone.
From The Economist:
…many American malls had run into trouble before the recession started, and the country’s nascent recovery is not likely to revive them. America’s retail sector is probably overbuilt; in the fourth quarter of 2011, according to the National Association of Realtors, its vacancy rate was 16.9%.