Vanessa Cohen is associate vice president at CBRE and a key member of the national investment services team specializing in retail investment sales. Drawing on experience in the local market and an education from UBC Sauder School of Business, Cohen has expert insights on the Greater Montréal Area’s retail landscape.
In an interview with Green Street News, Cohen talks about post-pandemic market recovery, resilient assets, investor strategies and factors that drive performance.
How has the retail investment landscape evolved in Montréal since the post-pandemic recovery, particularly regarding strip mall valuations and capitalization rates?
Since the onset of the pandemic, investor focus has increasingly shifted toward resilient retail assets, specifically centres offering essential goods and services and featuring a well-balanced mix of national, regional and local retailers. This demand for essential-service “one-stop” strip centres has gained momentum among both private and institutional investors as they’ve maintained steady demand through economic uncertainty. As a result – and in light of recent broader economic conditions – cap rates for these assets have compressed, like those seen in 2020.
We’re seeing a shift in retail tenant mix across various submarkets. How are investors adapting their acquisition strategies to these changing dynamics?
Investors are adapting by targeting assets with diversified, needs-based tenant mixes that prioritize service-oriented and daily-use retailers. They’re placing greater emphasis on tenant credit quality, lease durability and location fundamentals — favoring properties anchored by grocery, medical and discount retailers. In response to shifting consumer patterns, many are also expanding their focus to include neighbourhood and community centers in high-growth or under-retailed submarkets.
“These value-add strategies are helping investors future-proof assets while responding to evolving consumer demand and urban growth patterns”
In the same vein, investors are also analyzing retail assets through long-term covered land plays, where they see the opportunity to maximize underutilized land through pad developments or mixed-use integration. These value-add strategies are helping investors future-proof assets while responding to evolving consumer demand and urban growth patterns.
How has the recent decline in interest rates affected investment appetite in the retail sector, and what types of buyers are most active in the market?
The recent decline in interest rates has sparked renewed optimism in the retail investment market. Even during the high-rate environment, deal activity remained steady, driven largely by well-capitalized investors prepared to act on quality opportunities.
“The recent decline in interest rates has sparked renewed optimism in the retail investment market”
With bond yields easing and cap rates adjusting, retail assets have become increasingly attractive, drawing heightened interest from both institutional and private buyers. While some caution remains due to broader economic factors and the Fed’s decision to hold rates steady, the improved rate environment is creating momentum, with many investors positioning themselves to capitalize on favorable conditions ahead.
The grocery-anchored retail segment has shown resilience throughout market cycles. How do you see this subsector performing through 2025 to 2026?
The grocery-anchored retail segment has consistently demonstrated resilience across market cycles, and this strength is expected to continue through 2025/2026. Given current market conditions and the essential nature of grocery tenants, investor appetite remains high. In Québec, many institutional investors remain underweighted in retail, and lenders are actively allocating capital to this asset class, driving increased focus, collaboration and strategic acquisitions. On the disposition side, several institutions are approaching the end of their hold periods and are preparing to close funds, often reinvesting into retail with refreshed strategies.
“The grocery-anchored retail segment has consistently demonstrated resilience across market cycles, and this strength is expected to continue through 2025/2026”
Which retail submarkets in the Greater Montréal Area are demonstrating the strongest fundamentals, and what factors are driving their performance?
In the Greater Montréal Area, product scarcity is creating heightened demand, prompting investors to explore secondary markets, particularly for grocery-anchored retail strip malls. Notably, there is growing interest in the South Shore and North Shore regions, which lie outside the primary urban rings of the GMA. This shift is driven not only by the limited availability of assets in core areas but also by the expansion of residential developments in these secondary markets. Additionally, infrastructure projects like the REM — Montréal’s light rail network — and the EXO commuter train lines are catalyzing growth in surrounding regions and Québec City, further boosting the fundamentals of these emerging retail hotspots.
