2 years ago
Many Target locations have no obvious replacement tenent, says analyst With Target’s pending withdrawal from the Canadian marketplace there are 133 very large retail spaces that will be coming available starting later this year. Field Agent, a smartphone app that pays consumers to collect information while they shop, had its business analysts look at every Target location across Canada and mapped out the relative distance from the Target store to the current locations of potential replacement tenants. They looked specifically at Walmart, Costco, Lowe’s, Canadian Tire and the large format banners of Loblaw Companies in order to identify any potential suitors for the soon to vacant Target stores. Target is the anchor tenant in the Charlottetown Mall, comprising approximately 107,000 square feet of retail space. “From our analysis it is pretty clear that there will not be a ‘white knight’ among current Canadian retailers who will be able to scoop up all 133 locations” said Jeff Doucette, Field Agent’s general manager. “In fact, we expect that a large number of these locations will sit vacant for an extended period given the current network development of Canadian retailers. It is unclear if any foreign owned retailer not already operating in Canada would be willing or able to follow in Target’s footsteps, especially with the recent negative economic news and weak Canadian dollar.’’ One player who could make a step-change in their Canadian network is Lowe’s Canada. The U.S.-based company has a small network of just under 40 stores in Canada compared to Home Depot which has 180 locations across the country. “Lowe’s may be the retailer that has the means and the desire to pick up the largest number of former Target stores, especially non-mall locations located in suburban areas. Lowe’s has some good experience in operating in Canada and an existing supply chain that has been tried and tested. This could be a great opportunity for Lowe’s to drive measured growth for its Canadian operation,” said Doucette. With its Canadian stores averaging around 100,000 square feet, retail developers are looking at some big gaps when these buildings go dark. However, Target will be keen to sell its interest in order to recuperate some of its investment in Canada. This is a story that will definitely be one to watch in 2015.