retail%20(year-end%202005)

GVRD RETAIL YEAR END

2005

800 - 475 West Georgia Street, Vancouver, B.C. V6B 4M9

Phone: (604) 684-7117 • Fax: (604) 684-1017Visit Our WVisit Our WVisit Our WVisit Our WVisit Our Website: wwwebsite: wwwebsite: wwwebsite: wwwebsite: www.jjb.com/vancouver.jjb.com/vancouver.jjb.com/vancouver.jjb.com/vancouver.jjb.com/vancouver

MARKET NEWS

The GVRD will imposea new “parking tax”affecting allcommercial propertiesin the GVRD. The taxwill be assessed basedon the square metertotal of parking areaand is estimated at$1.02 per square meter.This tax encompassesall stalls, ramps,underground parking,soft landscaping, firelanes, etc. All ownersand subsequentlytenants will be affected,regardless of the type ofcommercial building.

MARKET OUTLOOK

British Columbia has been privy to a thriving economy in2005 resulting in increased consumer spending levels. B.C.’sretail sales were up 5.9% on the year through October, basedon the most current figures from Stats Canada, compared toa National average of 4.5%. Canada’s unemployment ratedropped to a 14-year low of 6.4%, while B.C.’s unemplyomentrate outpaced the national average by 1.5% in November andcame in at a 30-year low (4.9%) for the Province. The BMOFinancial Group forecasts B.C.’s GDP growth at 4.0% for2006.

Despite soaring petroleum prices with averages well over$1.00/litre in the summer, consumer confidence remained high and Canadians continued to spend. Anumber of factors helped the economy continue in prosperity including a robust housing market, lowinterest rates and a record setting Canadian dollar. Greater Vancouver’s housing boom has continued ashousing starts are anticipated to tally approximately 19,000 for 2005.

INVESTMENT SALESIn 2005 the retail investment market has seen strong demand from investors and owner users. Januarythrough December, Greater Vancouver witnessed 483 retail sale transactions representing over $818 millionof investment. Investor appetite remains sizable for retail product as interest rates have remained low andcapital readily available. REIT’s, pension funds and income trust groups have been especially eager toacquire this popular asset class and have been paying top dollars nationally and internationally. Retailinvestment product will continue to attract attention from outside B.C. and Canada and we can expectcapitalization rates to remain at record setting lows.

The largest sale recorded in the second half of 2005 was for the Riverport Sports & EntertainmentComplex in Richmond. Transglobe purchased the six building, 400,000 square foot centre for $85 million($212 psf) which includes facilities for hockey/skating, bowling, skateboarding, aquatics, basketball and a19-screen cinema currently leased to Famous Players. A number of hotel sites were acquired in downtownVancouver as well this half of 2005. Westbank Projects Corp. in partnership with Peterson Investment

Group purchased the parcel of undeveloped land adjacentto the Vancouver Convention Centre expansion fromFairmont Hotels & Resorts Inc. in September forapproximately $85 million. The joint venture will seethe development of an 800,000 square foot hotel &condominium tower. The Crowne Plaza Hotel Georgiaand adjacent parking lot site at 801 West Georgia Streetsold to Seattle based developer Goodman Real Estate Inc.for a reported $65 million with plans for a heritagerenovation and completion of 375,000 square feet ofmixed use hotel and residential development. TheBayshore Hotel and Resort also sold in October 2005 fora reported $19 million. No plans for development are inplace presently.


2005



Robson StreetHigh end and luxury retailers line Robson Street, especially in the 1000-1200 blocks, while tourists, business professionals and locals walk, shopand dine day in and day out. Robson Street, is near O% vacancy, whilelease rates remain the highest of any area in the GVRD. Some units arenow achieving lease rates up over the $200 mark per square foot.Consequently, an average unit of 1,000 square feet will cost $200,000per year in rent, without operating costs, for the privilege of callingRobson Street home.

In the second half of 2005, a few more retailers have moved, occupiedor expanded along Robson Street. Stone Ridge Shoes has opened inthe former Swatch location at 1093 Robson Street while a couple ofwomen’s accessory stores offering well priced jewellery and handbags,have opened nearby. Aldo Accessories opened at 1047 Robson Streetwhile Accessorize, a chain originally conceived in the UK, opened at1167 Robson Street and Xcetera opened at 1073 Robson. AmericanEagle Outfitters has occupied 1176 Robson Street, Peak Performance,a high performance sports store, has taken over the corner of Robson &Hornby Street (911 Robson), and Guess has leased the former Pastel’sCafé at 1101 Robson. Once renovated, this space will feature a smallerformat Guess Accessories location.

HIGHLIGHTS OF RECENT MOVES AND GRANDOPENINGS

VANCOUVER

Retail Area Lease Rates Vacancy RateRobson Street $145-$210 Stable

H-mart, an asian grocery chain, is set to open in the first quarter of2006 at the corner of Robson & Seymour in the L’Aria mixed usedevelopment.

Retail Area Lease Rates Vacancy RateDenman Street $20-$50 StableYaletown $30-$40 DecreaseDowntown $40-$100 Stable

Downtown and YaletownThe 800-1000 blocks of Granville Street downtown have seen aresurgence in leasing activity, increases in lease rates and an overallrevitalization. Amacon, a Vancouver based development company, haspre-leased all of their retail units currently under construction at 1026and 1056 Granville Street. A sample of tenants includes, Dare to WearLingerie and an undisclosed new restaurant/lounge concept. AdidasShoes has opened at 848 Granville Street while Puma Shoes hasreportedly leased in the 900 block of Granville Street and will open inthe spring of 2006. The Bonnis Group is in the midst of street frontretail construction along the 900 block. Six retail units are availableand are approximately 2,000 square feet each. Asking lease rates in thisarea are now up to $80 per square foot, indicative of the evolving strip.

Just off of Robson Street on Burrard, Lacoste has also opened (779Burrard Street). This is the French company’s first location in GreaterVancouver. Hugo Boss has opened a 1,800 square foot store in theluxury heritage retail area of West Hastings and Howe Street. In theHudson, the mixed use development at 610 Granville Street, a newsteakhouse concept will open a 10,000 square foot flagship location. Ahigh end workout gym has also leased a number of floors in thisdevelopment.

Cadillac Fairview has indicated that they will begin construction in thenorth end of Pacific Centre in 2006 to accommodate expansion plansfor their luxury tenant Holt Renfrew. Holts currently occupiesapproximately 85,000 square feet on three floors in the East side ofPacific Centre and are looking to reposition and expand to approximately120,000 square feet.

South Granville StreetLuxury retailers are flocking to the South Granville area to join longtime residents Meinhardt’s and Restoration Hardware along with newcomers Pottery Barn and Misch Shop. New to the scene in the secondhalf of 2005 include American Apparel, Prospera Credit Union andYves Delorme at the recently completed Shaughnessey Mansionsdevelopment (15th & Granville Street). Starbucks also successfullyopened their second location along this strip in October at 2288 Granville

ALDO ACCESSORIES ACCESSORIZEALDO ACCESSORIES ACCESSORIZE

1047 Robson Street 1167 Robson Street1047 Robson Street 1167 Robson Street


2005



LACOSTELACOSTE

779 Burrard Street779 Burrard Street

Tenant Type Origin Format LookingH & M Apparel Sweden Large NationalVictoria Secret Women's Lingerie U.S. Medium NationalWilliam Sonoma Home Furnishing U.S. Large NationalMango Women's Apparel Spain Large NationalAbercrombie & Fitch Junior Apparel U.S. Medium NationalTommy Bahama Apparel & Home U.S. Large NationalJoseph (Jacob) Mature Women's Apparel U.S. Medium NationalSephora Cosmetics Europe Large NationalApple Computer Computers & Software U.S. Small NationalOlsen Women's Apparel U.S. Small NationalGeox Men's & Women's Footwear Italy Small NationalBass Pro Outdoor Sports U.S. Large National

NEW ENTRANTS & EXPANSIONS- B.C. & CANADA

Street. Harrison Galleries has vacated their space at 2932 GranvilleStreet and has moved to 901 Homer Street in Yaletown. Lord’s Shoeswill be occupying their former South Granville space in 2006. Jack &Jill moved down a block from 2911 Granville to 2825 Granville. Theirformer space will be converted to a residential condo sales centre.Martha Sturdy will be relocating to larger premises and currently hasher gallery space for lease at 3039 Granville. Long time resident theNormandy Restaurant will be closing their 2,400 square foot locationat 2675 Granville Street. They will be replaced by Ecco Shoes in thefirst quarter of 2006. It has been rumoured that U.S. based Williams-Sonoma, a luxury home store, will construct a 3,000-4,000 square footlocation on the parking lot site at 13th & Granville Street and will openin late 2006.

Retail Area Lease Rates Vacancy RateSouth Granville $35-$85 StableWest 4th Avenue $35-$60 DecreaseWest Broadway Street $20-$40 Decrease

West Broadway and Kitsilano AreaKitsilano is also abundant with new construction; both residential andcommercial. Joey Tomatoes has begun construction on their newlocation at the former Kits Pub site at 1424 West Broadway. The 6,000square foot restaurant is anticipated to open in March of 2006.Construction will be commencing in 2006 on the Royal Bank site atCambie and West Broadway. PCI Group purchased Fairchild Plaza in2005 and will develop 98 residential units along with 122,000 squarefeet of retail space and 98,000 square feet of office space. Thedevelopment will incorporate the Canada Line (RAV line) from YVR todowntown and feature Whole Foods as the anchor tenant uponcompletion in 2007.

After an extremely busy start to 2005 with completions/occupancies

along West 4th, a few more new retailers have also taken space betweenBurrard and Yew Street. Most notably, Telus and Pure Nail Bar haveboth opened in the 2100 block of West 4th. This is Pure Nail Bar’ssecond Vancouver location.

RETAIL TRENDS

U.S. AND INTERNATIONAL TENANTSLOOKING IN VANCOUVER

With a thriving economy, steady retail sales numbers and higherdisposable incomes available to consumers, a number of new retailersare seeking high end locations in Vancouver. These new retailerscome from the U.S., Europe as well as some home-grown Canadianconcepts. The most popular category looking to expand is the 15-30year old apparel sector. H & M, the Swedish retailer, is currentlyseeking locations as is U.S. based Abercrombie & Fitch. Also BananaRepublic, Tommy Bahama and Motherhood Maternity are activelylooking to enter and/or expand in the men and women’s apparelcategories.

SUBURBAN

First Pro Shopping Centres, SurreyFirst Pro and Loblaw Properties have permits and rezoning applicationsin with the City of Surrey regarding their large site on 24th Avenue.The site comprises the four corners of 24th Avenue and 160th Street andwill offer an estimated 934,000 square feet of retail space to the area.Wal-Mart, Home Depot and The Real Canadian Superstore areanticipated to be anchor tenants. First Pro has also begun developingtheir large site at 88th & 124th Street in Surrey. This developmentcurrently features Wal-Mart and will include other large format retailers.

Seymour Creek Village, North VancouverKingswood Capital & Progressive Group will be developing 30 acres ofFirst Nations Land east of the 2nd Narrows Bridge in North Vancouver.The development will include approximately 430,000 square feet of retailspace. Construction is set to begin in 2006 and to complete in the springof 2008.

GVRD RETAIL YEAR END HI G H L I G H T S 2005

VANCOUVER • Toronto • Calgary • Edmonton • Winnipeg • Montreal • Mississauga • Burlington • Halifax •Kingston • Kelowna • London • Markham • Niagara • Ottawa • Regina • Saskatoon • Waterloo • Victoria

All information has been obtained from sources considered to be accurate but is not guaranteed and is subject to con-ditions at the time of any transaction taking place. Properties are submitted subject to prior sale or lease, withdrawal or

changes without notice.

FOR MORE INFORMATION, PLEASE CONTACT:Cynthia MartinDirector of Research604-630-3405

[email protected]



Property Name Street Name Municipality Building Size Total PriceRiverport Entertainment & Business Park Triangle Road & Entertainment Blvd Richmond 400,635 $84,950,000

Westin Bayshore Resort & Marina 1601 Bayshore Drive Vancouver 510 Rooms $77,987,445 Crowne Plaza Hotel Georgia 801 Georgia Street Vancouver 375,000 $65,000,000

Best Buy/Canadian Tire 2290 Cambie Street Vancouver 148,989 $44,500,000 Ackroyd Plaza 5880 No. 3 Road Richmond 106,382 $33,000,000

Langley Crossing Shopping Centre Langley 388,000 $29,100,000 Terra Nova Village Westminster Highway Richmond 73,170 $24,100,000

Granville & Cordova 320 Granville Street Vancouver 492 stalls $19,975,810 Vancouver Centre Travelodge 1304 Howe Street Vancouver 66 rooms $18,600,000

Pattison Dealership 15340 104th Avenue Surrey 19,900 $7,422,680 Denny's 5605-5665 Kingsway Burnaby 33,428 $6,500,000

Carleton Square 4161-4191Hastings Street Burnaby 28,641 $5,650,000 Golden Meadows Plaza 12059 Harris Road Pitt Meadows 21,400 $5,000,000

Bellevue Centre 1507-1517 Bellevue Avenue West Vancouver 9,505 $4,800,000 Shoe Warehouse bldg 2935 Granville Street Vancouver 6,300 $4,500,000

3000 Commercial Drive 3000 Commercial Drive Vancouver 27,400 $4,500,000 750-790 West 6th Avenue 750-790 West 6th Avenue Vancouver 9,000 $3,600,000

Source: Realnet Canada

SALE TRANSACTIONS JULY-DEC 2005:

VANCOUVER • Toronto • Calgary • Edmonton • Winnipeg • Montreal • Mississauga • Nanaimo • Burlington • Halifax •Kingston • Kelowna • London • Markham • Niagara • Ottawa • Regina • Saskatoon • Waterloo • Victoria

All information has been obtained from sources considered to be accurate but is not guaranteed and is subject to condi-tions at the time of any transaction taking place. Properties are submitted subject to prior sale or lease, withdrawal or

changes without notice.

South Burnaby Power Centre, BurnabyAnthem Properties has begun construction at Marine Way and ByrneRoad on 330,000 square feet of large format retail development.Tenants include: Winners, Staples, Linens N’ Things, Petcetera andMichael’s. Completion is set for spring 2006.

Marine Way Market, BurnabyWestbank Projects is developing a 250,000 square foot groceryanchored project at SW Marine Drive and Byrne Road. Tenants include:Save on Foods, London Drugs and Canadian Tire. Completion isanticipated for fall 2006.

North Road Centre, North BurnabyLedingham McAllister will begin construction on their mixed usedevelopment at North Road and Cameron Street in Burnaby in 2006.The 100,000 square feet of retail space will be tenanted by a Fitnessconcept, drug store and a Save on Foods. Completion for the retailphase in expected in the fall of 2006.

The Pier, North VancouverPinnacle International will be constructing approximately 50,000square feet of retail space and 60,000 square feet of office space throughfour phases at Lower Lonsdale. Aside from a community of homes,amenities to the area will include; a hotel, conference centre, gallery,public parks, 700 foot waterfront pier and Seabus access to DowntownVancouver.

LOOKING AHEADB.C.’s economy is expected to remain strong with consumer demandconsistently increasing for housing goods and services in the retail sector.The Central Credit Union of BC foresees robust growth in 2006 asB.C.’s employment rate is expected to further improve and our job marketis anticipated to be the “best in years” thanks to natural resources,construction and most recently, transportation. As interest rates remainlow and capital readily available, retail assets will continue to draw stronginterest from tenants and prospective purchasers. High consumerconfidence, stemming from Government participation in infrastructureprojects, the 2010 Winter Olympics and our strong housing market,creates a positive outlook for Greater Vancouver’s real estate market.

retail%20(year-end%202005)

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