All this good news has buoyed the local economy and helped the retail sector to ride out the winds of e-commerce. “There are signs of optimism,” said Luciano D’Iorio, the Montréal-based managing director who oversees Cushman & Wakefield’s Québec operations. “We have full employment, the political situation is quite stable compared to the mood elsewhere in the world, and we are investing in infrastructure.”

If there is anything to be viewed as “bad” news, it is perhaps that the city feels so confident about its economic fortunes that it will soon undertake a major renovation of rue Sainte-Catherine — also called Saint Catherine Street, considered the Fifth Avenue of Montréal. Plans are to tear up the whole street and put in new sewage pipes and infrastructure. There is even talk of installing heated sidewalks. Rue Sainte-Catherine, lined with stores and malls, is the heart and soul of downtown Montréal’s shopping district. Rents there are the highest in the city, running as high as C$200 to C$250 per square foot (roughly $160 to $200 per square foot), says Mathieu Lalonde, a research analyst at Cushman & Wakefield. Work will not commence for about a year, but that is already causing major problems even so. “Along the street, leases are coming up and they are not being renewed, probably because people don’t know what to expect,” said Lalonde.

Francescutti acknowledges that rue Sainte-Catherine is undergoing a lot of change, but she opines that there are other reasons for the vacancy rates. “The renovation of the street is what everyone is talking about, but I don’t think that is what is causing the vacancies,” she said. “Rents are high, and some of the tenants that were there just couldn’t afford to pay those kinds of rents.”

Despite that uncertainty, there is still retailer commitment to rue Sainte-Catherine. Victoria’s Secret opened a 33,160-square-foot store there in 2015, at the time the second largest Victoria’s Secret store in the world. The largest commitment is coming from Montréal-based Ivanhoé Cambridge, which owns two properties on rue Sainte-Catherine: Montréal Eaton Centre, which is, at 278,000 square feet and with some 26 million visitors yearly, one of Canada’s busiest malls, and the adjacent Complexe Les Ailes, which measures about 200,000 square feet. The two will be combined with a unified appearance and branding and a new name. One other big change in downtown Montréal is the coming of a Four Seasons hotel, which will be attached to the Ogilvy department store.

If there is any shopping area that can compete with rue Sainte-Catherine in terms of lease rates, that would be the super-regional Carrefour Laval mall, just off the Island of Montréal. Lalonde says rents at Carrefour Laval have now surpassed rue Sainte-Catherine. “That mall is about 90 percent occupied,” said Lalonde. “Vacancies come up and they are quickly filled. This is a mall that does well attracting new brands. Any retailer that wants to come to the Montréal market will have its first store at Carrefour Laval.” Lalonde cites Apple, Crate & Barrel and Lego, all of which have used the mall as an entry point into the city over the past several years.

Another Montréal mall doing well is Galeries d’Anjou, in the Anjou borough of Montréal. This mall had more to overcome, having lost a big Target store when the company closed all its Canada stores in 2015. “[Saks Fifth Avenue Off 5th] and a few other stores have taken over the Target site,” said D’Iorio. “It is owned by Cadillac Fairview, which also owns Carrefour Laval.”

Saks Fifth Avenue, now owned by Canada’s Hudson’s Bay Co., is in the process of expanding its Off Fifth brand. Its next Montréal store is to open at the renovated Eaton Centre.

“There’s definitely a gap between Montréal’s class-A malls and the ‘B’ and ‘C’ malls,” said Francescutti. “The class-A malls are really holding their ground well. One of the reasons is that retailers at one time had a strategy of having locations in all the malls. Now they’d rather have fewer locations.”