Sneak Peek: YVR's New Outlet Mall is Unlike Anything on This Continent
When the hotly anticipated McArthurGlen Designer Outlet opens near YVR this spring, it'll be the first location on this continent for the UK-based outlet builder. We caught up with North American development director Joan Jove—in town for the ICSC convention in Whistler—to find out more.
Joan tells us the centre, the first designer outlet of its kind in the Vancouver area, is being built in two phases. The first, opening this spring, has 240k SF of retail space, with 75 tenants, including cafes and eateries. The second phase will add 140k SF and bring the total retailers at the outlet to 120 (there'll be 2,500 parking spots, and free Canada Line service from the airport). The centre is a JV between McArthurGlen and Vancouver Airport Authority, the not-for-profit organization that operates YVR.  The centre is laid out like an open-air village, with tree-lined streets, a fountain, three piazzas and children's playground. The design—while European flavoured, as per the look of McArthurGlen's 20 outlets in eight countries on that continent—also draws inspiration from historic Vancouver architecture, like the city's first post office building (now part of the Sinclair Centre complex) and the Vancouver Rowing Club, as well as the brick facades found in Gastown. (In 2013 McArthurGlen became a JV between the world's largest retail developer, Simon Property Group, and Kaempfer Partners.)
 The outlet will offer a mix of brands, Joan notes, including mid-market, premium, luxury and sports retailers (he won't name names ahead of the grand opening). “We like to appeal to a broad range of customers." The market for the outlet mall, Joan says, will be both tourists (with 9 million of them coming to Vancouver each year) and locals, who've never had this kind of outlet mall on home turf. “We felt there was a gap here. Now people won't have to cross the border to shop at outlets.”
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New Office Supply Brings Uncertainty
A handful of big deals in the second half of 2014—namely the Healthcare of Ontario Pension Plan (HOOPP) sale of 1500 West Georgia (seen below) to Bosa Properties and Kingswood Properties for $120.5M, and Manulife's acquisition of the HSBC building at 3383 Gilmore Way in Burnaby for $80M—helped push overall transaction activity last year to just under $2B, close to the same record investment levels seen in 2012 and 2013, Avison Young's Bal Atwal tells us. But with 1.7M SF of office construction underway, and more than 1M SF more set for delivery in the first part of this year, there's uncertainty swirling around the Vancouver office market.
 Avison Young is predicting downtown vacancy will exceed 10% by the end of 2015, up significantly from 3.9% in 2012. But Bal notes that most of the office space scheduled to be delivered this year is pre-leased, so “any impact felt will likely trickle down to B- and C-class product.” There's opportunity here, he stresses. Landlords with well-located older buildings who opt to upgrade their spaces will retain tenants or attract new ones at rents “marginally higher than what they're currently achieving,” Bal says. “I still see upside in some of these properties.”
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Marriott Acquires Delta Hotels For $168M
Marriott International announced last week it's acquiring the Delta Hotels and Resorts brand and management and franchise business from Delta Hotels for $168M, making it the country's largest full-service hotel company, according to the company. Founded in 1962 in Richmond (with a motor inn named Delport Inn) today the Delta brand includes 38 hotels and 10,000 rooms in 30-plus cities nationwide, including the new flagship Delta Toronto (above.) The acquisition of Delta—subject to Canadian Competition Bureau approval—will increase Marriott's presence in Canada to more than 120 hotels and 27,000 rooms. Marriott CEO Arne Sorenson noted the plan is to grow the Delta brand in Canada and globally.
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