Edmonton real estate investments bounced back from a slow start to the year with a surge in commercial real estate transactions in the second quarter (Q2) – and strong land demand was among the highlights.
Second-quarter 2022 total investment jumped by more than $930 million to $1.46 billion, reports the Network, which tracks Alberta commercial real estate market.
“This dramatic turnaround was fueled in large part by a renewed appetite for industrial and multi- family properties, as well as strong demand for land. These three asset classes increased by $440 million, $180 million and $159 million respectively,” noted Network president Nathan Gettel.
Coming out of a two-year trough, the land asset class saw transactions double from the $78.8 million seen in the first quarter. Year-to-date total dollar volume of land sales made a major upswing as a result, surpassing a four-year record of $233.4 million set at the mid-point of 2019.
The stand-out land transaction of 2022 to date is the $60 million ($399,627/acre) purchase of 150 acres at 13004 33 Street NE by Air Products Canada Ltd. The land is destined to become the site for a major hydrogen power project.
Air Products is building the world’s largest net-zero hydrogen network at the northeast Edmonton site. The company said the $1.3 billion facility, expected to be operational in 2024, will make Edmonton the centre of western Canada’s hydrogen economy and set the stage for Air Products to operate the most competitive and lowest-carbon-intensity hydrogen network in the world.
“By being a first mover and investing in this innovative landmark project, we are paving the way for hydrogen from Edmonton to meet industrial and transportation needs throughout western Canada,” said Air Products CEO Seifi Ghasemi.
Edmonton land is also being purchased for residential development. An example is the sale of 60.6 acres of agricultural land at 18103-17 Street NE, Edmonton. Bought for $3.35 million in the first quarter of this year, it has the potential for a residential subdivision, according to Avison Young, Edmonton, which brokered the sale.
Quarter-over-quarter commercial real estate investment in Edmonton were up across the board as of June 30, with even the office sector seeing approximately $35 million in new purchases. Retail saw approximately $80 million in new investment and commercial condominiums saw a $25 million increase in dollar volume.
Year-over-year sales activity increased by more than 120 per cent overall, with both transaction volume and dollar volume marking the best mid-year level seen since 2020.
