Density needed for downtown grocery in Saskatoon: Commercial real estate agents say grocers are interested, but waiting for more people

Reported by Karin Yeske, NewsTalk 980 CJME, April 3, 2014 - It’s going to take more people living in downtown Saskatoon to get a grocery store in the area, according to two commercial agents in the city.As part of his state of the city address, Mayor Don Atchison offered a minimum five year tax break to the first grocer to build downtown.

While mainstream grocers have been interested in the idea for the last couple years, they’ve been holding out until the population starts growing.

“It's a bit of a chicken and egg. You need the population to drive the grocery store and you probably need the grocery store to drive the population. We need to get to a level with a little more density,” Tom McClocklin, president and broker with Colliers International Saskatoon, said.

The same analogy was used by Phill Elenko, managing partner for ICR.

“We have to get more people downtown. We have got to motivate developers to go ahead and build more density and residential downtown,” he said, adding most of the multi-unit housing in the area consists of seniors’ homes.

“We have talked to several grocery stores over the years with regards in trying to accommodate the mayor and his wishes. We continually get the same pushback. We just don’t have the density.”

Both agreed that a tax abatement would help expedite the process, but it wouldn’t be enough.

"Anything that the city can do in that regard, whether it is the cost of land or tax abatement, it would be helpful,” McClocklin said. A major chain could create an urban format of their store that would fit within a building and wouldn’t be dependent upon parking spaces, he said pointing to examples across the country.

Atchison spoke of plans Wednesday to build downtown’s density up to 35,000 people with mixed use high-rises and condo developments. Elenko said the million-dollar question is how to entice developers to take a risk.

“We just need developers that have the confidence in the economy and in the city that will pull the trigger on these projects,” Elenko said.

McClocklin said larger-scale formats involving a new building might work better in north downtown or Riversdale. However, he said there is plenty of space in downtown to accommodate both housing and a grocery store.

Elenko said ICR tried filling the former Safeway (currently Bayside) on 2nd Avenue North with another grocer.

“We got close. If that was probably 10 years down the road, that might have happened,” Elenko said.

Across Canada there is a trend for more people, especially the younger generation, to move and live downtown.

"It used to be that everybody would want to get out of downtown as quickly as possible. If you look across the country, you're seeing much more urbanization of people wanting to live downtown closer to where they work, closer to where they socialize and go out. We've got a great, active social scene in Saskatoon whether that's restaurants or bars or music venues, theatres, we've got a new art gallery being built,” McClocklin said.

If downtown Saskatoon can continue to thrive, a grocer wanting to invest might come knocking.

"If we see some of these developments happen, then I think you might have them more interested. The reality for them is the first person that comes in is going to get the market because there probably isn't room for two or three," McClocklin said.

More people are living in condos as opposed to single-family houses. In Saskatoon, over 50 per cent of all the new builds are multi-family units, McClockin said, attributing it partly to affordability.

Many people don't want to take care of a house or yard and are happy to visit the river.

“There’s certainly a lot of talk about it and now it’s just the population realizing you can have fun living downtown, too,” Elenko said.

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