Location, location, location: Alberta’s housing market in a national context

August 18, 2022 By

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If you’re a homeowner, headlines like “a sharp correction is coming” and “the bubble is about to burst” send shivers up your spine, but they are music to the ears of anyone looking to break into the market.

The extreme downward trajectory of house prices suggested by these headlines and expected in some parts of Canada is not, however, on the horizon in Alberta.

Average home prices in Vancouver and Toronto were already skyhigh going into the pandemic while other Canadian cities have experienced rapid price escalation since COVID became a household word.

Take Moncton, New Brunswick: According to the Canadian Real Estate Association, the benchmark* price of a home on the resale market in the city jumped by 82% between February 2020 and July 2022. With the benchmark at $334,500, it was still a relatively affordable market (the benchmark in Toronto in July was, for example, $1,184,100), but buyers still had to come up with over $150,000 more for a typical home in the area than they did just two-and-a-half years ago.

While markets like Halifax-Dartmouth (+70%), Victoria (+50%) and Hamilton-Burlington (+49%) saw prices spike during the pandemic, Calgary and Edmonton posted solid, but more modest, growth at +25% and +16%, respectively. As such, because a housing bubble didn’t form here, there isn’t one to burst.

At the same time, robust economic growth in Alberta (we will likely lead the country in this regard in 2022), the recent return to being a net recipient of interprovincial migrants, a somewhat younger (though still aging) population, and the high quality of life offered here provide strong support for the provincial housing sector going forward.

As a recent report from Desjardins points out, “the oil-producing provinces of Alberta, Saskatchewan, and Newfoundland and Labrador [are] benefitting from post-pandemic tailwinds, largely in the form of higher commodity prices. The resulting job creation and workers it attracts from across the country will provide support to existing home sales and prices.”

Higher interest rates combined with national and global economic uncertainty may eat away somewhat at home prices in Alberta, but we should be able to avoid the potentially severe erosion that some other markets may experience.

*The MLS® Home Price Index (HPI) model is used to calculate benchmark prices in key Canadian markets. A “benchmark home” is one whose attributes are typical of homes traded in the area where it is located and includes single family homes, townhouse/row units and apartment units.

Filed Under: Miscellaneous Articles

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August 18, 2022 By

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Filed Under: Featured Listings

Demand high for industrial space across city

August 17, 2022 By

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Michael Erickson, the city’s director of economic development, said the last four years has seen 1.4 million square feet of industrial completed and absorbed in St. Albert.1008 construction main sup CCThe City of St. Albert is working toward creating an area structure plan for the west end of the city, which will include the Lakeview Business District. The area will help expand the industrial space in St. Albert to allow for more businesses in the community. 

The scarcity of industrial property in the region and the high demand for the space is driving the city to focus on building more space for businesses to set up shop, said one expert in St. Albert’s economic development department.

Michael Erickson, the city’s director of economic development, said the last four years has seen 1.4 million square feet of industrial space completed and absorbed in St. Albert.

“To put that in context, that’s about a third of the city’s entire industrial inventory that has been added in the last four to five years,” Erickson said.

In the past few years, St. Albert has seen large corporations open, including the Alberta Liquor Gaming and Cannabis building in 2018 and the Uline branch distribution facility — a 600,000-square-foot space set up in the Anthony Henday Business Park (AHBP)

The AHBP is also adding two new buildings, Erickson said, both slated to start construction this year, which together will offer around 400,000 square feet.

“This isn’t slowing down anytime soon,” Erickson said of construction.

“We continue to receive a ton of interest from industrial developers and from end users, from businesses that were ultimately located in some of those properties under construction,” Erickson said.

The expert said he doesn’t know if many people think about St. Albert as being a surging place for industrial companies to come for warehousing and manufacturing, but that is what the city is quickly becoming.

The Lakeview district will be the next location for businesses to develop, as the rest of the business parks in the city start to reach capacity.

Currently industrial space is scarce across the entire region and Erickson said the city sees a lot of demand for the space they have to offer to businesses.

Lakeview Business District — formerly known as the Employment Lands — comprises 618 acres west of Ray Gibbon Drive between Giroux Road and McKenney Avenue. According to the city, the preliminary servicing plans for the new business district are being completed as part of the St. Albert West Area Structure Plan and Neighbourhood Plan and the city expects these to be completed by June 2023.

The design and construction of any servicing to Lakeview will be subject to council approval in the future, city spokesperson Nicole Lynch said in an email.

The economic development department is fielding tons of calls from potential industrial development groups which have an interest in developing in the business park, Erickson said.

Some end users would be considered mega-site users — looking for more than 500 acres — while others might be smaller businesses which would be the type of users going into the Anthony Henday Business Park right now.

“For us, we sort of see that as the future, a key employment area for St. Albert, and an economic engine for St. Albert for decades to come,” Erickson said.

Filed Under: Industrial, Miscellaneous Articles

Commercial tower added to Riverbank Landing in St. Albert

August 12, 2022 By

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Boudreau Communities says demand has meant adding a sixth commercial building to the riverfront mixed-use project.

A recent ground-breaking ceremony was held on the large mixed-use development.

Boudreau Communities has added a commercial tower as it began its Riverbank Landing project in St. Albert, an affluent suburban community near Edmonton, Alberta.

Dave Haut, CEO of Boudreau Communities, said the site is ready to start servicing underground this summer. Construction on the first building, a 15-storey tower and commercial space along the river, will begin later this year.

The entire project will include 360 residential units, with condo prices starting at less than $300,000 and ranging to more than $900,000.

Situated on the banks of the Sturgeon River the project is to include two residential high rises, nine-storey seniors building, micro-loft suites, new restaurants, and boutique retail / office buildings.

Ten acres are set aside for a riverfront park and nature preserve.

Haut said a ground-breaking ceremony received a good turnout, with attendance from council members and “a number of potential purchasers” for both commercial space and condos.

“I think a lot of people are looking forward to this project getting started.”

While original plans included five buildings, Haut said plans have expanded to include a small sixth building which will provide additional commercial space.

“There’s a big hill there and we needed to deal with it somehow,” Haut said frankly,  adding that the expansion is also a result of market demands.

Haut said about 65 per cent of the condo units have already been reserved with a refundable deposit.

Boudreau Communities can’t finalize the site’s drawings until they receive a permit from the city.  “In the fall, when everything’s planned down to the last ditch, then we reach out to those people [who have reserved space],” Haut said.

As far as whether the previously estimated construction timeline of five to seven years remains accurate, Haut said it would be closer to five because the “market acceptance has been really strong.”

I think we’re going to be able to accelerate that,” Haut said, adding that in terms of commercial space, Boudreau is seeing interest from small local restaurateurs and service providers, as well as from medical providers such as physiotherapists and doctors.

Filed Under: Boudreau Communities, Commercial Real Estate