Ivanhoé Cambridge seeks ‘fresh’ mix of shopping centre anchors

IMAGE: Metropolis at Metrotown shopping centre in Burnaby, B.C., owned by Ivanhoé Cambridge. (Courtesy Ivanhoé Cambridge)

Metropolis at Metrotown shopping centre in Burnaby, B.C., owned by Ivanhoé Cambridge. (Courtesy Ivanhoé Cambridge)

If Graeme Silvera, Ivanhoé Cambridge’s vice-president of retail development, were to launch a new big-city shopping centre from scratch, he’d have no problem building it without massive anchor tenants.

“If I was doing a greenfield (mall development) today, I would pick five junior (tenants) over one major anchor as the new format,” he said during a panel on retail disruption at the recent Vancouver Real Estate Forum. “When you say anchor . . . to me that means anchoring down the shopping centre.

“When I look at a traditional anchor, they lock you down so much you can’t change the centre.”

Silvera is speaking from experience. In 2015, Ivanhoé Cambridge’s Metropolis at Burnaby’s Metrotown lost a 116,000-square foot Target store as part of the retailer’s Canadian retreat (Walmart eventually took its space). Then in 2018, the mall’s Sears department store anchor shut down (that site is separately owned by Concord Pacific, which is working on a massive mixed-use redevelopment process).

“The new anchors are those new, fresh entrants coming to the market,” he said. “(They’re) mid-size and they’re driving the traffic significantly.”

Canada’s shopping centre situation is becoming increasingly polarized, with large, centrally located urban malls seeing more sales than ever, while secondary malls in outlying areas or small cities are experiencing large swaths of vacancy.

Muji, Uniqlo, Aritzia represent new wave

He said the best example of new, smaller anchors has been the success of Muji. The Japanese minimalist retailer opened a 7,500-square-foot store at Metropolis in 2017.

“Within a year of opening, they have decided the store is too small, so they’re actually taking the retail space beside them and upsizing to 12,500 square feet — so almost doubling their size within a year of opening,” Silvera said.

Retailers like Muji, Uniqlo and Aritzia continue to drive demand in medium-sized spaces in the main corridors of their malls. “The new sort of 10,000- to 15,000- (square-foot) format stores have actually become the new anchors of the shopping centre,” he said.

Big city mall sales continue to surge

In Metro Vancouver, Metropolis last year experienced a 13.8 per cent increase in annual sales per square foot (psf) at $1,008 psf. Vancouver’s Oakridge logged a 10.2 per cent increase at $1,537 psf; Richmond Centre marked an 11.4 per cent increase ($928 psf); and Pacific Centre saw a 6.7 per cent increase ($1,599 psf), according to data presented at the panel by Morguard.

But the list of recently failed retailers in Canada is growing longer with Home Outfitters and Payless Shoes among the more recent headline-grabbers.

The reason for many of these closures is pretty clear, said panelist Carolyn Egan, the senior director of leasing in the West for Choice Properties REIT  (CHP-UN-T), which owns more than 750 properties with a focus on supermarkets. The failed retailers did not stay fresh and were not listening to their customers.

Retailers such Aritzia and the T&T grocery store chain continue to thrive, she said, providing a couple of local success stories as examples. “They are interactive, exciting and they hit you at all levels.”

“I think what is dead is bad retail,” said Michael Macintyre, vice-president for e-commerce and omni channel strategy for Indochino, the Vancouver-based manufacturer of men’s suits. “There are some terrible examples of consumer experiences in stores and that’s why they’re failing.”

Ivanhoe Cambridge focused on strong, urban retail

Ivanhoé Cambridge currently has 29 Canadian shopping centres, according to its website, but it has said it’s looking to sell its non-core properties in primarily suburban locations.

“(Those locations) would have pretty poor transit connections, and essentially, I wouldn’t see a lot of opportunity in the near term to attract those key retailers you need to keep the property relevant,” Silvera said.

The company also said earlier this year it will invest $500 million in upgrading several key properties. It has already spent $3 billion over the last three years upgrading and building new outlet malls.

Retail is certainly central to its investment strategy moving forward.

The market appears to be entrenching into a few different successful forms: outlet malls, luxury centres, experiential shopping or neighbourhood centres targeted to provide daily necessities, Silvera said.

“If you don’t fall into one of those categories, I think that’s the type of retail that is sort of headed for extinction.”


Evan is a freelance multimedia journalist in Vancouver, who has covered business, news, politics and more. In addition to RENX, his work has appeared in the Vancouver Sun, B-Magazine, The…

Read more

Evan is a freelance multimedia journalist in Vancouver, who has covered business, news, politics and more. In addition to RENX, his work has appeared in the Vancouver Sun, B-Magazine, The…

Read more





Industry Events