The Cherry Lane Shopping Centre, the only enclosed shopping centre in the South Okanagan and Similkameen Valley, has been put on the market by the owners, according to a commercial real estate listing published last week.
Located at 2111 Main Street directly east of Lion's Community Park, the Cherry Lane Shopping Centre sits on 21.6 acres of land that is bounded by Warren Avenue W on the north, Main Street on the east, Kinney Avenue on the south, and Atkinson Street on the west. The property includes 1,144 parking stalls, including a 1.50-acre excess surface parking lot on the other side of Warren Avenue W that is also part of the same legal parcel.
The mall is home to around 50 stores and 277,336 sq. ft of retail space, with major tenants including Save On Foods, London Drugs, Valley First Credit Union, Angry Otter Liquor, and CIBC. Smaller tenants include Booster Juice, Canada Post, Royal LePage, and The Shoe Company. Prior to its insolvency, Hudson's Bay was also in Cherry Lane, but the embattled retailer has since vacated its space in the centre.
The Cherry Lane Shopping Centre originally opened in 1975 and BC Assessment values the property at $68,764,000, according to an assessment dated July 1, 2024, and marking an increase from the previous assessed value of $62,093,000.
The Cherry Lane Shopping Centre at 2111 Main Street in Penticton. / JLL
The shopping centre is held under Cherry Lane Shopping Centre Holdings Ltd. and beneficially owned by Manulife Financial Corporation, according to documents from the Hudson's Bay court proceedings. The mall is managed by commercial real estate services firm JLL, who reached an agreement with Manulife in December 2022 to manage all of Manulife's properties in Canada.
The Listing
Last week, the Cherry Lane Shopping Centre was listed for sale by JLL's Capital Markets team and National Retail Investment Group, who described Cherry Lane as a "dominant" shopping centre and said that a 100% freehold interest in the property is being offered free and clear of any financing. The property appears to have been listed previously, as JLL described the listing as a "relaunch."
- Address: 2111 Main Street, Penticton
- Year Built: 1975
- Site Area: 21.56 acres
- Gross Leasable Area: 277,336 sq. ft
- Current Occupancy Rate: 90.7% (excluding former Hudson's Bay space)
- Price: Unpriced
- Listed By: JLL (Edgar Buksevics, Kevin Meikle, Kevin Douglas, Brodie Henrichsen, Matthew Smith, Nick Macoritto)
According to JLL, the shopping centre has an occupancy rate of 90.7% as of June 1 when excluding 94,643 sq. ft that was formerly occupied by Hudson's Bay. That space is located at the western side of the mall and JLL notes that the space could either be re-leased or redeveloped.
A site map (left) and tenancy overview (right) of the Cherry Lane Shopping Centre in Penticton. / JLL
"Functioning as a regional shopping hub, Cherry Lane attracts customers and visitors from a growing trade area of 68,560 residents that includes the City of Penticton and the neighboring communities of Summerland, Okanagan Falls, Naramata, Oliver, and Osoyoos," said JLL in a sales brochure. "Strategically positioned in the heart of Penticton's primary shopping district, Cherry Lane features prime visibility along Main Street, the city's main north-south thoroughfare. The Property benefits from a wealth of nearby amenities, growing neighborhoods, and a vibrant daytime population supported by nearby employment centers."
The listing also suggests that the property — renovated in 1995, 2005, and 2015 — could potentially be redeveloped.
"Immediate value-add strategies are available on the Property with the recent availability of the former 94,643 sf Hudson's Bay Box, offering the opportunity to strengthen the retail offering through re-leasing or undertake mixed-use development under the City of Penticton's Transit Oriented Areas policy of 2.50 floor area ratio," said JLL. "Cherry Lane's significance is further underscored by its location on one of the largest land parcels in Penticton. The Property's transit-oriented land use designation offers exciting potential for future redevelopment into higher density, mixed-use residential and commercial uses."
Whether or not the mall will be redeveloped — an increasing trend for large shopping centres across Canada — remains to be seen, but the possibility undoubtedly enhances the value of the property.
Although the commercial real estate market in BC has been somewhat slow this year, retail properties have continued to transact at a relatively steady pace. Manulife recently sold Piccadilly Mall — an 226,213-sq.-ft shopping centre located at 1151 10 Avenue SW in Salmon Arm, BC — in a sale that was brokered by Marcus & Millichap, alongside Cushman & Wakefield. The buyer remains unknown, but was represented by Newmark. Other malls that have transacted this year include the Cottonwood Centre in Chilliwack and Willowbrook Park in Langley.
