As Calgary’s retail landscape continues to evolve in 2025, tenants looking to lease retail space need to be informed about the latest market trends, shifting consumer behaviors, and emerging opportunities. Whether you’re an established retailer, a new business, or an investor in Calgary’s retail real estate market, understanding what’s happening in the leasing market can help you secure the best space for your needs.
At JR Mercantile Real Estate Advisors Inc., we specialize in helping tenants navigate the commercial leasing market, with a particular focus on retail spaces. Here’s what you need to know about leasing retail properties in Calgary in 2025.
1. Evolving Consumer Behavior and Retail Preferences
Consumer behavior in Calgary, as elsewhere, has been shifting toward more experience-driven retail. Shoppers are increasingly seeking not just products, but unique experiences that blend shopping with entertainment, dining, and community engagement. As we move further into 2025, this change in shopping habits will continue to influence retail leasing in the city.
What does this mean for retail tenants?
- Experiential Retail Spaces: In response to shifting consumer preferences, Calgary tenants can expect more demand for retail spaces that go beyond traditional retail stores. Pop-up shops, interactive displays, and showrooms that provide hands-on experiences are gaining traction. Retailers offering an engaging experience, such as cafes, workshops, or live demonstrations, will be in high demand in certain areas.
- Focus on Omni-Channel Retailing: With more consumers shopping both online and in-store, there is an increased need for retail spaces that can accommodate omni-channel retailing. This means stores need to be adaptable, with space for both in-person shopping and digital infrastructure, such as pick-up and return stations, or click-and-collect services.
- Sustainability in Retail: Environmentally conscious consumers are on the rise, and retail tenants should consider how sustainability can be incorporated into their spaces. Green building features, energy-efficient systems, and eco-friendly product offerings will resonate with today’s consumers.
2. Retail Space Supply and Demand in Calgary
As Calgary’s economy recovers and grows in 2025, there will be fluctuating demand for retail spaces, particularly in high-traffic areas. Calgary’s retail market is undergoing a transformation, with new opportunities in developing and revitalized districts.
What does this mean for retail tenants?
- Prime Retail Locations in High-Demand Areas: In popular areas such as downtown Calgary, Beltline, Kensington, and East Village, demand for retail spaces will remain strong. These areas are seeing significant revitalization, with new residential and commercial developments attracting both locals and visitors. Retail tenants in these prime areas can expect high foot traffic and a vibrant customer base.
- Emerging Retail Hubs: As Calgary’s population continues to grow, new retail hubs are being developed in suburban areas. Neighborhoods like Seton, Quarry Park, and the northwest and southeast quadrants of the city are becoming increasingly popular with retail tenants. If you’re considering a location outside of the downtown core, keep an eye on these emerging areas, where commercial real estate opportunities may be more affordable, while still benefiting from population growth.
- Retail Vacancy Rates and Rental Prices: The retail leasing market in Calgary has seen changes in vacancy rates, particularly following the effects of the pandemic. In certain areas, you may find vacancies offering more favorable rental rates. For tenants, this presents an opportunity to negotiate better lease terms, including rent-free periods or rental reductions, especially in locations with higher vacancy rates.
3. Leasing Flexibility and Incentives
As the retail market continues to adapt to evolving consumer behaviors and the economic environment, Calgary landlords are offering more flexible lease options to attract and retain tenants. For retail tenants in 2025, understanding these new leasing trends can help you secure favorable terms.
What does this mean for retail tenants?
- Shorter Lease Terms: Tenants who may be hesitant to commit to long-term leases can benefit from more flexible lease options. Shorter lease terms allow retailers to adjust quickly if their business model or location needs change, while also providing more flexibility in a constantly evolving retail market.
- Tenant Incentives: Landlords are more likely to offer incentives to retail tenants, particularly in areas with higher vacancy rates. These incentives may include rent-free periods, tenant improvement allowances (TIAs), or reduced rent for the first few months of the lease. If you’re looking for space, take advantage of these offers to offset the initial costs of moving in or renovating.
- Flexible Space Requirements: As many retailers are transitioning to hybrid models or expanding their online presence, the need for adaptable spaces is on the rise. Retail tenants should look for spaces that offer flexibility for future adjustments, such as the ability to expand, contract, or incorporate both physical and digital elements into their store designs.
4. The Influence of Technology and Digital Integration
Technology is playing a larger role in Calgary’s retail spaces, both in terms of how businesses operate and how customers shop. As retailers embrace technology to enhance their customer experience and streamline operations, retail tenants will need to stay ahead of the curve in adopting new tech-driven strategies.
What does this mean for retail tenants?
- Tech-Enabled Spaces: Many retail properties in Calgary are being outfitted with technology that supports modern retail operations. This includes high-speed internet access, digital signage, integrated point-of-sale (POS) systems, and interactive displays. Look for retail spaces that are tech-ready, as this will be essential for running a smooth, customer-centric business.
- Smart Retail Solutions: The growing trend of automation, contactless payments, and AI-powered customer service will likely influence Calgary’s retail market. Tenants should look for spaces that offer the infrastructure to accommodate smart solutions, such as self-checkout stations or automated inventory management.
- Digital Integration: Many brick-and-mortar retailers are blending physical stores with digital solutions, including virtual shopping, e-commerce integration, and online ordering systems. Retail spaces with built-in infrastructure for digital and physical interactions can give tenants a competitive edge.
5. Retail Trends Shaping Leasing Decisions
Understanding emerging retail trends will help tenants make smarter decisions when leasing space in 2025. Calgary’s retail market is evolving to meet new demands, and tenants must stay attuned to these changes.
What does this mean for retail tenants?
- Pop-Up Shops and Flex Spaces: The demand for pop-up shops, temporary retail locations, and flexible spaces is on the rise. Retailers may prefer short-term leases that allow for quick adjustments or seasonal sales. Look for properties that can accommodate this flexibility, with spaces that are easy to set up and take down.
- Multi-Use and Mixed-Use Developments: Calgary is seeing an increase in multi-use and mixed-use developments that combine retail with residential, office, and entertainment spaces. Leasing retail space in these developments can provide tenants with a steady flow of potential customers, as these properties cater to diverse demographics.
- Community-Focused Retail: Calgary’s retail tenants are becoming more focused on serving the local community. Consumers are increasingly interested in supporting local businesses, and retail tenants are responding by offering unique, community-driven experiences. Look for spaces that offer the potential to connect with local consumers and create a sense of community engagement.
Conclusion: Navigating Calgary’s Retail Leasing Market in 2025
Calgary’s retail leasing market in 2025 offers a variety of opportunities for businesses seeking to establish or expand their presence in the city. As consumer behaviors shift toward experience-driven retail, and as technology and sustainability continue to influence the market, retail tenants must be prepared to navigate these changes.
At JR Mercantile Real Estate Advisors Inc., we specialize in helping retail tenants find the ideal space that aligns with their business goals. Whether you’re looking for a high-traffic location in Calgary’s downtown core or an emerging retail hub in the suburbs, our team is here to guide you through the leasing process.
Contact us today to learn more about how we can help you achieve your commercial real estate objectives with confidence and certainty. You can reach out to us at either http://www.jrmercantile.com , 403-770-3071 or at hello@jrmercantile.com
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