Retail Market and Trends Ottawa Real Estate Forum October 11, 2012 - PowerPoint PPT Presentation

An Overview of Ottawa’s Retail Market and Trends Ottawa Real Estate Forum October 11, 2012 Barry Nabatian , A.A.S., B.Sc., M.Sc. T: 613.224.8484 x117 Director, Market Research Division E: barry@shore-tanner.com

ANNUAL POPULATION GROWTH 2006 - 2012 Estimated Population in 2012: • Capital Region: 1,378,000 • City of Ottawa: 946,000 Capital Region Annual Growth Since 2006: • Capital Region: +1.79% City of Ottawa • City of Ottawa: +1.75% 946,000 • Generally, standard growth rate is 1.0% 1,378,000 +19,000 +14,200

ANNUAL POPULATION GROWTH 2006 - 2012 Population Growth (in Ottawa) From In-Migration and International Immigration: Capital Region •Typically: 30-70% per year •Since 2006: About 37% per year City of Ottawa

SELECTED AGE GROUPS, 2011 20-34 Years Old: 20.9% 35-54 Years Old: 30.2% 65 & Older: 13.2% Median Age: 39.2 Years Estimated Average Annual Population Growth in Ottawa: 2012-2017 • 10,000 to 14,000 per year

HOUSEHOLD INCOME IN OTTAWA Households with over $100,000 income in: 40 • 2006: 30.7% 38 • 2012: 39.0% 39.0% 36 34 The overall average household income: 32 •2006: $85,136 per household 30 30.7% •2012: $98,000 per household 28 26 24 2006 2012

INCOMES IN OTTAWA High Paying Jobs Account for 55% of all Jobs in Ottawa: •High Technology •Health, education & government •Finance & insurance •Lobbyists Total Annual Income in Ottawa: =$50.3 Billion

RETAIL MARKET IN OTTAWA Existing Inventory: 32.0 Million Sq.Ft. Overall Vacancy Rate: Overall Vacancy Rate: 3.0% Under Construction: 0.8 Million Sq.Ft. Proposed Construction: 1.5 Million Sq.Ft.

RETAIL MARKET IN OTTAWA Distribution of Space: •Regional & Power Centres •Community Centres •Neighbourhood Malls •Neighbourhood Malls •Downtown & Strip Malls 31% 30% 25% Box Store Component of Total = 25% 33%

MORE ABOUT OTTAWA’S RETAIL MARKET Demand for more space: • 300,000 to 400,000 sq.ft. for every 10,000 population growth Other reasons for more development: • Too much in downtown, not enough in the suburbs • Too many poor, outmoded, unpopular stores • Popularity/seduction of new concepts, names, promotions

MORE ABOUT OTTAWA’S RETAIL MARKET High spending power of residents: •Ottawa’s retail market is lucrative Total Spending •Total spending of Tourists: $0.30 B $15.0 B •Total spending of Residents: $15.0 B •Total spending of Residents: $15.0 B Service Average spending per resident: $3,900 •$12,000 at retail stores Retail •$3,900 at service stores $12,000 •$475 per sq.ft. of annual average sales Average per Resident $0.3 B

CURRENT & FUTURE TRENDS Declining Sales/Market Shares: • Mid-price, mid-quality stores • • Tired department stores Tired department stores • Small, independent stores • Oversupplied stores • Poorly located stores

CURRENT & FUTURE TRENDS Marginally Growing or Declining Businesses: • Fashion stores • Accessory stores • Restaurants & bars • Sports & recreation • Discretionary businesses

GROWING BUSINESSES & TRENDS Existing & Intensifying Trends: • De-malling of poor-performing enclosed malls • Mergers/buyouts • E-shopping • More aggressive advertising • Charity associated promotions

GROWING BUSINESSES & TRENDS New Stores: • Deep discount stores • • High-end stores High-end stores • Beauty, health & wellness products • More American & European stores • Smaller Walmart stores (40,000 sq.ft.)

GROWING BUSINESSES & TRENDS Forward Looking: • Energy saving products/services • • Organic, green products Organic, green products • Farmer’s markets • Cultural, leisure, travel businesses • More automation, fewer employees per 1,000 sq.ft. at large stores • More business improvement areas

Consumers have many choices in today’s retail environment. Their loyalty must be earned, rather than taken for granted!