Edmonton Area Industrial Real Estate ‘Surge’: Report

garretschoenbergNovember 3, 2022

“The lack of commercial space is starting to spur new development, which is very exciting.”

The Edmonton Chamber of Commerce encourages employers to adopt a return-to-office plan. Photo by Ian Kucerak /post media, file

The industrial property market is “booming” in and around Edmonton, says a new market report.

Meanwhile, office vacancy rates continue to rise as the retail market recovers slowly.

Edmonton’s industrial market share rose to 96.4% in the third quarter of 2022, NAI Commercial Real Estate said in a report, citing land availability and prices attracting investment from B.C. added. In the Edmonton market, industrial vacancy rate he is 0.2%.

Jeffrey Sandquist, president and CEO of the Edmonton Chamber of Commerce, said the biggest gains were seen in Leduc and Nisk, south of the city, but still benefiting the region. says.

“This is why regional cooperation is so important,” Sundquist told Postmedia, adding that local governments could benefit from breaking down the “virtual barriers” that separate them. “These businesses create jobs and economic prosperity and bring them back to the city in many ways, including nightlife, retail shopping, dining, transportation and festivals.”

“They want to be near the action”

The industrial vacancy rate in the Edmonton metropolitan area will decline steadily from the fourth quarter of 2021 (4.6%) to the third quarter of 2022 (3.6%), the report said. City.

The report identifies Ledac as a “major beneficiary” of the industry surge, with vacancy rates dropping to 4.7% last quarter from 6.3% over the same period.

For the city of Leduc, oil and gas supplies and services continue to be the main drivers behind the trend, economic development manager Harold Wilson told The Post Media.

In addition to its proximity to the airport, Queen Elizabeth II Highway and the 65th Avenue Interchange, which will connect to this corridor, this is one of its mainstays, he added.

“They want to be near the action or in that sector because they might have great suppliers too,” he said. It’s fascinating because it could be.”

He added that declining vacancy rates have spurred new commercial development, with $20 million worth of industrial permits already in place for 2022.

living space opportunity

Meanwhile, the office market is having a strong day, affected by remote work during the COVID-19 pandemic, says the report.

The reported vacancy rate in the Edmonton metropolitan area was 9% in Q4 2021 and has gradually increased to 9.6% in Q3 2022. The same thing happens in downtown Edmonton, with rates of 10.1% to 11.7% and 14.5% to 15.2% in the university and Garneau area.

Sundquist said the trend is worrying, but the chamber remains hopeful.

The Chamber of Commerce is encouraging employers to adopt a return-to-office plan, which will revitalize businesses around stores and businesses, but interest rates continue to rise, leaving the sector ready for investment. must be ready.

“That means our downtown is clean, safe, and easy to get around,” he said, adding that the city still has work to do in that regard. Prioritizing and making sure we do the very basics will help us secure investment from businesses and businesses outside the city.”

The city could also consider converting downtown office towers for residential use, he said, adding that the Chamber of Commerce is asking the council to encourage pivot incentives.

“Increased housing migration brings an influx of people, which is sorely needed to restore and rejuvenate the core,” he said.

“Starting to spur new developments”

In the Edmonton metropolitan area, the recovery in the retail market has slowed, with vacancy rates at 4.3% this quarter, compared to 4.8% in the fourth quarter of 2021, the report said.

Chad Snow, president of the NAI, said the trend signaled an approaching recovery in the capital with increased demand for brick-and-mortar stores for the kinds of products people prefer to buy in person.

Again, Leduc stood out in this area with its vacancy rate dropping from 4.1% to 1.2% over the same period.

Similar to the industrial market, Wilson said high occupancy is boosting projects and has already tripled the value of commercial permits compared to 2021.

“The lack of commercial space is starting to spur new development, which is very exciting,” he said.

hissawi@postmedia.com

@hamdiissawi