SW Ontario Retail Market Report

Anchor closures lift vacancy but create long-term opportunity. Southwestern Ontario’s retail market recorded a modest softening in 2025, as vacancy rose 90 basis points. Much of this shift, however, stemmed from the closure of nearly 10 Hudson’s Bay locations across the region, which temporarily returned large blocks of space to the market. Even with this disruption, the metro remained among the tightest retail environments in the country. In many cases, these former department store spaces are presenting investors with new opportunities to enhance long-term asset performance. Owners can re-tenant the space at higher market rents, subdivide large boxes to accommodate a wider mix of tenants and pop-ups, or pursue longer-term redevelopment plans that better align with evolving retail and residential demand — ultimately benefiting both property owners and the surrounding communities they serve.