I must be at the ICSC - 2003 Western Canada Idea Exchange in Calgary.
It is customary during Stampede Week to feature
programs heavy on fun, light on substance. ICSC this
year is no exception.
The big emphasis this time is on tenant
participation. Marcel Proskow, ICSC Western Canada
Provincial Director, says a record 50 tenants are
registered (thanks in part to free registration for
tenants). Congrats to ICSC for permitting it.
The Exhibitors Leasing Lounge seems to be fairly busy
and a new concept, the Lease-O-Rama, has been launched
to feature expanding retailers, new projects and leasing
State of the
After a traditional pancake breakfast, ICSC Canadian
Division Vice President (and President and CEO of
Ivanhoe Cambridge) Rene Tremblay, summed up 2002 – 2003
as a very interesting year for the retail industry. Low
interest rates, a strong housing market, broad economic
growth and generally balanced budgets have produced
another year of strong economic growth in Canada. For
the fourth consecutive year, Canadian GDP has grown
faster than that of the US. Rene observes, however, that
the rate of job growth is slower than last year. Retail
sales started very strong in the year but are weakening.
A strengthening Canadian dollar, SARS and continued
struggles in the US economy are expected to reduce the
rate of growth in Canada for the balance of this year
and a slowdown is anticipated.
Clothing, shoes and household furnishing sales have
soared in Western Canada while remaining flat for most
of the rest of the country.
Rene reports that consolidation in the industry has
more or less stopped, at least at the ownership level.
While investment capital for shopping centers remains
fairly readily available (primarily in the hands of
smaller pension funds, REITs and institutions), quality
investment opportunities on the ownership side are
relatively scarce. Rene expects the Canada Pension Plan
Fund to become a huge player over the next several
years. Several projects are underway in Western Canada,
either re-developments or new, including Market Mall in
Calgary, West Edmonton Mall in Edmonton and Metrotown in
Burnaby. A number of lifestyle center concepts are
underway, including Park Royal in Vancouver and Don
Mills and Vaughn Mills, the latter being the first
enclosed mall to be built in Canada in 13 years.
Ownership on the retail side has been somewhat in
flux, with a number of chains and brands changing hands.
D’Aillards is for sale, and Safeway, as a Western
Canadian anchor, is considered to be a ripe target for a
change of ownership.
The influx of US and European retailers into Western
Canada continues, including major forays by Best Buy,
Old Navy, Home Sense, Linen & Things, Skechers,
Children’s Place, Bang & Olefsson and many others.
Rene reports that approximately 180 US retail chains
have a toe-hold in Canada now, along with at least two
dozen European ones.
New blood and increased competition is fostering new
formats, like stand alone Sears Grand store concept.
Walmart (now with 213 stores in Canada) and Target are
expected to continue to aggressively expand. As
effectively as Walmart has invaded the grocery business
in the US, grocers in Canada are adopting retail growth
strategies which sees them competing with Zellers and
drugstores for traditional business. I was surprised to
hear that Loblaws has become the third largest seller of
children’s clothing in Canada. I guess it shouldn’t be a
surprise then that Zellers is getting into selling
refrigerated and frozen foods. Emerging grocery store
concepts are evolving, including the introduction of
cooking schools, fitness centers and even hosting kids’
birthday parties. Canadian Tire is rolling out its new
Concept 20/20 stores with home décor, housewares and
furniture, while Home Depot is doing the same with its
new Design Place concept. Focusing on the growth of
existing brands coupled with innovation seems to be not
only desireable, but necessary for success with ever
Don Cooper, a speaking professional and former sports
equipment manufacturer (is there anyone who hasn’t owned
a Cooper baseball glove) and retailer (Alive and Well)
gave an energetic and passionate motivational
presentation on the importance of retailers
understanding their customers and building loyalty. He
spoke to retailers from the heart about the need to be
noticed and remembered, understood and differentiated,
trusted and preferred in order to be successful. He
offered a number of key insights into Human Marketing, a
trademarked concept of Don’s. Fascinating stuff and I
couldn’t possibly do it justice to attempt to summarize
Lunch featured a heartfelt address from John Furlong,
President and CEO of the Vancouver 2010 Bid Corporation.
He provided a glimpse of the 5 years of unstinting
dedication, determination and creativity of the team and
the almost unimaginable challenges that had to be faced
to achieve Number 1. We were treated to two of the
videos the team used to sway opinion around the world.
Wonderful and stirring images to the sounds of Bryan
Adams. Definitely worth a look if you have the chance.
Makes you proud to be a Canadian. John deserved and got
a standing ovation.
All in all, a fine Calgary show. I feel I learned
something, and had fun to boot. (Let’s not talk about
golf). Calgary deserves its reputation as a friendly
people place. From an industry perspective, and despite
widespread concern in the industry last year, 2002
turned out to be an extraordinary year in Canada. The
year 2003 will be strong also, characterized by
continued and rapid evolution in retailing.
- Stu Wells