Calgary Retail Market Report
Outperforming Economy Cushions Demand Deceleration;
Suburban Retail Remains in Focus
Elevated migration and oil prices to aid retail sector. Consistent with the national trend, Calgary’s economy will experience a slowdown in 2023 as elevated borrowing costs weigh on spending and investment. A further boost in immigration and domestic in-migration, however, will support the metro’s job market and consumption. Furthermore, oil production in Alberta should remain healthy as international oil prices are expected to hover above the historical average, again propping up employment. As a result, when compared to most other metros in Canada, Calgary will still likely edge out positive economic growth this year. Consumer demand and, in turn, retail leasing activity will therefore hold steady. Sector fundamentals will also be underpinned by supply-side tailwinds. Barriers created by high borrowing costs, supply chain disruptions and labour shortages caused completions to fall short of expectations in 2022. Looking ahead, a prolonged period of elevated borrowing costs will continue to pose challenges to developers, which will again restrict supply.