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American retailers “shocked” at Calgary’s fast pace | Print |  Email
Tuesday, 22 October 2013 17:10
Last month, Jeff McGinley, principal of Avison Young, took time from touring representatives of three major U.S. retail clients through Calgary’s “aggressive” retail scene to remark on their jaw-dropping response.
Most U.S. retailers “are shocked by our low vacancy and competitive nature. It is radically different in Calgary,” he said.
While the retail vacancy rate in Calgary is officially 2 per cent – compared to a 10.4 per cent average in U.S. cities – Calgary’s true vacancy rate is zero in many prime retail zones, McGinley explained.
“Many Landlords are intentionally holding vacant space off the market as they are repositioning their centres. Two examples of this are the Shape Properties’ redevelopment of Deerfoot Mall and Harvard’s massive redevelopment of Eau Claire market.”
“We are in an aggressive retail marketplace,” McGinley understated.
Calgary lease rates for its top shopping strolls are also likely surprising out-of-towners. Fourth Street SW and 17th Avenue SW, where lease rates average $60 to $65 per square foot, are ranked among the top 10 most expensive retail streets in Canada, according to Colliers International. In these areas, lease rates have increased by as much as 9.1 per cent in the last year alone.
Calgary has an employment rate of less than 4.5 per cent (compared to 7.2 per cent in the U.S.) and highest average weekly wage - $1,113 - in the country.
Alberta’s retail spending volume is the third highest in the country and it soared 7.7 per cent to $6.1 billion as of mid-year, the biggest increase in Canada.
Giant U.S. retailer Target has zeroed in on Calgary, opening seven stores in the city since May. Seattle-based Norstrom, a high-end fashion retailer, is scheduled to open in Calgary next year, taking the former Sears Canada space in Chinook Centre Mall. New York retailer Saks Inc. is also scouting for top Calgary space, following its purchase by Hudson Bay Company.
It is apparent that Americans catch on fast to what it takes to make it in Calgary. “U.S. retailers are very nimble.” McGinley said, who recently toured Golf Town, Dollarama and 7-11 executives through Calgary’s retail opportunities.
 
Calgary land sales running at $150M per month | Print |  Email
Tuesday, 22 October 2013 16:35
Seen as a harbinger of future development, land sales have become the dominant driver in Calgary’s commercial real estate sector, with sales topping a whopping average of $150 million per month this year.
Sales of land increased 242 per cent in the first six months of this year, compared to 2012, reports Avison Young. Land sales accounted for 42 per cent of all Calgary commercial transactions as of mid-2013, up from a 13 per cent share a year earlier.
“The key driver is land sales, which totaled $902 million [in the first six months]” Avison Young reports in its Fall 2012 Canada, U.S. Commercial Real Estate Investment Review.
Total commercial real estate volumes in Alberta’s biggest city reached $2.2 billion in the first half, up 4 per cent from the same period in 2012.
A big drop was seen in office investments, which plunged from the record-breaking $1 billion posted in early 2012, to $654 million, a 40 per cent drop.
However, Avison Young analysts noted that, “early 2012 was a phenomenal breakthrough period” and cautioned that the current pace remains strong and “should not be viewed as a declining sector.”  Office transactions accounted for 30 per cent of the total commercial sector in the first half of this year.
Real estate investment trusts (REITs) are pulling back from Calgary’s commercial market in response to higher mortgage rates, Avison Young notes, suggesting that this could open opportunities for smaller investors. In the first half of this year – before mortgage rate hikes in late May – just two REIT office deals accounted for $259 million in sales.
 
Red Deer industrial tightens | Print |  Email
Monday, 28 October 2013 00:00

 

The Red Deer industrial real estate inventory grew by about 3.1 per cent last year to more than 12.5 million square feet, but that growth didn't increase the vacancy rate.

That's because of the net absorption of more than 415,000 square feet, according to a recent industrial market survey done by Soderquist Appraisals Ltd.

The Red Deer-based firm found industrial vacancy in the busy market actually declined from 3.4 per cent in 2012 to 3.1 per cent in 2013. In total, the Red Deer market has gobbled up about 810,000 square feet of industrial space in the past two years.

Don't expect that pace to slow.

The City of Red Deer issued 141 permits in July for $17.9 million in new construction, bringing its seven-month 2013 total to $152.9 million. That's an overall increase of about $10.8 million over last year.

While there's been a 54 per cent decline in commercial permit values in 2012, industrial permits hit $38 million this year, up from just $8 million in the same period in 2012.u

– Compiled by Dave Husdal


from Western Investor October 2013

 
Leduc grows, neighbours quarrel | Print |  Email
Monday, 14 October 2013 00:00

 

The City of Leduc is growing by leaps and bounds these days.

The latest census data from the Edmonton-area suburb show Leduc grew by 6.9 per cent from 2012 to 2013, hitting a population of 27,241.

The one-year 6.9 per cent growth rate exceeded the city's five-year annual rate of 5.8 per cent.

Leduc Mayor Greg Krischke said, "It would be a safe bet that Leduc will surpass 30,000 citizens in the next two years."

Of note, the city is looking less like a suburb. The latest data found that only 20 per cent of employed residents commute to Edmonton for work while 70 per cent work in the city itself and another 10 per cent work in the area outside Edmonton and Leduc.

Growth for Leduc will also be automatic come January 1, 2014. That's when the city will grow by another 1,329 acres, which it will annex from Leduc County.

While the county supported Leduc's annexation, it is resisting a much larger application by the City of Edmonton to take control of a large swath of land south of the Alberta capital.

Edmonton wants to annex about 38,000 acres of land - that's roughly five times the current size of Leduc and includes Edmonton International Airport.

The county strongly opposes the application and has been trying to rally opposition to such a large land grab.

According to county officials, Edmonton's proposal would siphon off 17 per cent of the county's tax base and lead to a 10 per cent property tax hike in the remainder of the county. It would also mean a potential 62 per cent tax hike for businesses and residents in the annexation area, county officials contend.


from Western Investor October 2013

 
Three Sisters lands sold under sealed court order | Print |  Email
Wednesday, 02 October 2013 00:00

 

Three Sisters lands sold under sealed court orderAfter more than four years tied up in receivership, lands connected with Three Sisters Mountain Village (TSMV) in Canmore have been sold to its former owners.

A Court of Queen's Bench judge approved the sale of Three Sisters assets to 1712841 Alberta Ltd. in early September. While a redacted copy of the sales agreement was released, the court sealed the price.

Western Investor sources, including an unsuccessful bidder, estimate the sale price at from $30 million to $50 million, with the consensus at the lower end. The secured creditors were owed roughly $90 million, according to documents filed by receiver PricewaterhouseCoopers.

1712841 Alberta Ltd. is affiliated with Blair Richardson and Don Taylor, two men who have been part of TSMV ownership in the past and who were among the secured creditors left holding the bag when a collapse in the resort real estate market in early 2009 put TSMV into receivership.

Exactly what will happen with the 1,495 acres of prime mountainside real estate involved in the sale remains to be seen. The purchaser can't sell the property as part of one massive deal for at least a year.

PwC had been pursuing a new area structure plan (ASP) for the land to increase its sales appeal in the Rocky Mountains resort community, but opposition to its plan, which included fencing off wildlife corridor spaces from development areas, stopped the ASP process in the spring.

As a former bidder noted, the uncertainty surrounding rezoning and allowed use of the property is among the reasons why a discounted price is likely.

The new owners have some history with the community, which may help move future plans along once the fall municipal election results are clear in late October, and the developer knows what kind of political environment it will be facing.

Chris Ollenberger, a former CEO and president of TSMV, will be working on behalf of the new owners to steer the initial post-purchase activities.

He said the new owners haven't settled on a vision for the property yet, and want to get a good handle first on the state of the land and what's been done since they were last involved before settling on what new direction they might take.

"The owners are still interested in health and wellness as an overall thought and process and vision to the property, but the details of how that would actually be worked out and what that would look like and the next steps moving forward is completely up in the air at this point," Ollenberger said.

The 2004 plan called for a high-end spa and golf course, which are now in limbo.


from Western Investor October 2013

 
Three Sisters lands sold under the gavel | Print |  Email
Monday, 09 September 2013 18:53
After more than four years tied up in receivership, lands connected with Three Sisters Mountain Village in Canmore have been sold to its former owners.
A Court of Queen's Bench Judge approved the sale of Three Sisters assets to 1712841 Alberta Ltd. in early September. While a redacted copy of the sales agreement was released, the court sealed the price.
Western Investor sources, including an unsuccessful bidder, estimate the sale price at from $30 million to $50 million, with the consensus at the lower end. The secured creditors were owed roughly $90 million, according to documents filed by receiver PricewaterhouseCoopers.
1712841 Alberta Ltd. is affiliated with Blair Richardson and Don Taylor, two men who have been part of TSMV ownership in the past, and who were among the secured creditors left holding the bag when a collapse in the resort real estate market in early 2009 put TSMV into receivership.
Exactly what will happen with the 1,495 acres of prime mountainside real estate involved in the sale remains to be seen. The purchaser can't sell the property as part of one massive deal for at least a year.
PwC had been pursuing a new area structure plan for the land to increase its sales appeal in the Rocky Mountains resort community, but opposition to its plan, which included fencing off wildlife corridor spaces from development areas, stopped the ASP process in the spring.
As a former bidder noted, the uncertainty surrounding rezoning and allowed use of the property is among the reasons why a discounted price is likely.
The new owners have some history with the community, which may help move future plans along once the fall municipal election results are clear in late October, and the developer knows what kind of political environment it will be facing.
Chris Ollenberger, a former CEO and president of TSMV, will be working on behalf of the new owners to steer the initial post-purchase activities.
He said the new owners haven't settled on a vision for the property yet, and want to get a good handle first on the state of the land, and what's been done since they were last involved, before settling on what new direction they might take.
"The next steps moving forward is completely up in the air at this point," Ollenberger said.
 
Canada ranks 5th as global real estate investment | Print |  Email
Wednesday, 28 August 2013 19:08

Canada is in fifth spot worldwide when it comes to real-estate investment and is the only developed nation to break the top five, according to the results of an EY survey published August 29.
The top four countries on the list are all emerging markets: India, China, Quatar and Chile. Criteria for the ranking included credit availability and economic stability.
"Investors are looking beyond the developed world - with the exception of Canada - and focusing their investment strategies in emerging markets with immense growth potential," said Krista Blaikie, EY's national real-estate leader.
"Canada, on the other hand, continues to attract the attention of investors searching for a stable political and economic environment not found in the Eurozone."
The survey also found that 85 per cent of real-estate industry executives believe the global economy is stable or improving - a significant improvement compared with the results last year (53 per cent).

- Business in Vancouver

 
PwC will sell Canmore lands | Print |  Email
Wednesday, 25 September 2013 00:00

 

The firm in control of almost 1,500 acres of Canmore development land has decided to abandon its plans to obtain a new area structure plan for the massive Three Sisters development.

Receiver PricewaterhouseCoopers (PwC) has instead been granted court backing to sell assets of Three Sisters Mountain Village in order to recover money owed to HSBC Bank, the primary secured creditor for the failed land developer.

PwC's proposed new development plan failed to win civic or public support.


from Western Investor September 2013

 
Work starts on new bridge | Print |  Email
Wednesday, 25 September 2013 00:00

 

Edmontonians living south of the North Saskatchewan River and working downtown will have a new bridge to drive across in early 2016, if all goes well.

After months of prep work, the City of Edmonton started construction in early July on the new $155 million Walterdale Bridge.

The arch bridge will be a landmark spanning the river and will carry three lanes of northbound traffic as well as cyclists and pedestrians.

It will replace the existing two-lane, century-old bridge that currently carries northbound commuters into the core.

The existing bridge will remain open during the 30-month construction phase for the new bridge, with some temporary or partial closures of connecting roads during the construction process.

Still, the city is warning motorists to expect delays, particularly during the peak of construction activities in the summer months.


from Western Investor September 2013

 
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