Montreal Retail Market Report

Leasing demand showing early signs of softening. Following a swift recovery in 2022, momentum in Montreal's retail sector continued to build. In the first five months of 2023, total retail sales grew 6.4 per cent year-over-year. As tourists returned, spending at restaurants and bars in Québec also rose significantly, registering a 22 per cent annual increase within the same period. This strength in consumer spending helped maintain above-average annual rent growth in the second quarter of 2023. However, the metro's vacancy rate ticked up slightly in June, with net absorption falling into negative territory. This was likely due to many retailers' increasing reluctance to expand operations amid rising interest rates and looming fears of a near-term slump in economic activity.