Last Updated on October 24, 2023 by Ephraim Vecina
Canada’s rental and retail property segment should brace itself for the heightened demand that will come with the upcoming legalization of recreational cannabis, according to RioCan Real Estate Investment Trust.
This is especially true for the hottest markets – especially Ontario, which is expected to host a much increased number of facilities as October approaches.
The sharp uptick in demand will begin once retailers start “looking to stake a claim at the best locations, many of which we own,” RioCan CEO Edward Sonshine said last week, as quoted by Bloomberg.
Ontario remains the leading choice among Canadian cannabis producers and sellers. Pot companies said that they would proceed with setting up shop once the provincial government allows private sales of the herb.
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Currently, Ontario’s set-up mandates that sales are to be conducted by government agencies such as the Liquor Control Board of Ontario.
“There’s no question that whatever rules finally come down, they’re not going to want four cannabis stores at one corner — there’s going to be some control over that,” Sonshine stated.
Edward Jones & Co. analyst Matt Kopsky noted that legalization and the ensuing mad rush for space represent a golden opportunity for firms that have access to large expanses of commercial real estate, such as RioCan.
“Obviously it’s a growing segment within the retail market, and I’m here in Colorado and there’s stores all over the state,” Kopsky explained. “With retail struggling, it’s good to have any sort of growth opportunities.”
Legalized marijuana can drive demand for as much as 200,000 square feet (19,000 square metres) of retail space, RioCan estimated.
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Ephraim is currently a journalist at Mortgage Broker News, Real Estate Professional and Canadian Real Estate Wealth.
Ephraim is a highly accomplished news reporter whose work has been published across North America and the Asia Pacific region. Before joining Key Media, Ephraim spent eight years working as a journalist with Reuters TV. His areas of expertise include real estate, mortgage, and finance.
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