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Thread: Downtown Office Tower Vacancies

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    Default Downtown Office Tower Vacancies

    Perhaps this is too broad of a topic for a single post, but I'm curious to get a handle on what the office vacancies situation is. With all of the moving around in the next few years, I'm curious what will be happening to these buildings. Who will be moving into them, will they be getting renovations - or perhaps even complete 'REIMAGININGs" - as a way to attract new tenants. What would you like to see happen to them?

    HSBC Place
    A smaller tower, but well connected to Manulife and the Oxford towers via City Centre. The City of Edmonton is currently the primary tenant.

    CN Tower
    City of Edmonton has a sizable presence in this tower as well, though I'm not sure how much, or who else is in the building. I know a lot of us would like to see this building get the attention it deserves.

    Chancery Hall
    Once again, COE is the main tenant - is there anyone else in this one? If not, once the City moves out, it'll be free for a major renovation. I know the idea of a residential conversion has been thrown around a lot.

    Any other towers significantly impacted by COE's move?

    Enbridge Place and Enbridge Tower will both be emptied when they move. Does Enbridge have a major presence in the other locations that they're moving from?

    I know Stantec will be vacating the building beside Bell Tower, but where else are they located Downtown? Obviously there Oliver campus will be emptied, but anything else specifically downtown?

    Any other downtown office towers which significant vacancies (pending or current)? Obviously 9Triple8 is empty right now, but they have a major tenant moving in if I'm not mistaken.

    As a final note, I'm not intending this as a harbinger of doom "we have too many vacancies!" post. I'm just curious which buildings are being impacted by the shuffling, and want to keep an eye on what will become of them.

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    Very far from doom. These vacancies open up future opportunities. It was hard for people to move downtown when there was no space. Now that there will be space and various steps of rental rates, there could be some interesting companies moving downtown.

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    Quote Originally Posted by Aptkwen View Post
    Very far from doom. These vacancies open up future opportunities. It was hard for people to move downtown when there was no space. Now that there will be space and various steps of rental rates, there could be some interesting companies moving downtown.
    Exactly. I imagine, for instance, that Stantec's Oliver HQ will be very attractive to small and medium-sized firms when it opens up.
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    To get a handle on the current situation, Colliers International publishes a quarterly Edmonton Skyline Report. Most recent report is Q3 2014 available here: http://www.collierscanada.com/en/Com...n&rpp=5&page=2

    The report shows the vacancies (tracked by floor) in pretty much every office building in the Downtown and even a few buildings in adjacent areas like Oliver. It can be accessed through a LinkedIn account or be creating an account. It's a huge document (48.5MB) so it may take some time to download depending on your connection speed.
    Last edited by East McCauley; 10-12-2014 at 07:53 PM.

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    I am also wondering who will possibly move into all these vacated downtown towers. Can't convert every tower into residential.
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    Backfilling space in older office buildings will be a challenge for many landlords. You have to remember that many of these buildings are older A-class borderline B-class office space. The premier A and AA-class space will be highly coveted and will continue to command good rates. There will be some that 'may' look to repurpose to other uses, but for the most part I think many will stay as office buildings.

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    Vacancy is opportunity.
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    Not sure if BMO qualifies for the list as it has been all but unleaseable since it was built. It might have a better chance once connected to Kelly Ramsey, but I could see it continue to sortof bottomfeed even still due to the weird floorplates.

    About the larger situation, I would expect rates to decrease among every pre-1979 building until one way or another their vacancy recovers, except Chancery, whose office days should be over, and BMO until they do something drastic.
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    With a lot of these movers and shakers vacating B Class office space in downtown. This could open up the market for firms to move into downtown due to increased affordability. I think the city should siege this opportunity by putting tax incentives on firms that choose to relocate to downtown. In turn, by vacating a lot of the office space in industrial type areas, the city could redevelop and infill that empty land into residential, which could mitigate our sprawl problem.

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    Remember when The Bow in Calgary was being built and the worry? Vacancy is a good thing, more room for others. Also gives opportunity or renos. The ones worried the most are the colliers of the world... Of course they are they primarly concerned about lease rates.

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    Quote Originally Posted by ChrisD View Post
    Backfilling space in older office buildings will be a challenge for many landlords. You have to remember that many of these buildings are older A-class borderline B-class office space. The premier A and AA-class space will be highly coveted and will continue to command good rates. There will be some that 'may' look to repurpose to other uses, but for the most part I think many will stay as office buildings.
    Correct. You won't see any of the upcoming batch of vacated buildings repurposed, they will remain office use

    Some of those buildings will be challenging to lease due to less than ideal floor plates, location and fewer amenities.

    Some landlords may need to dig deep to attract new tenants

    ** except Chancery. Can see that being sold to CRHA or something to that effect
    Last edited by 240GLT; 11-12-2014 at 07:13 AM.

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    Quote Originally Posted by East McCauley View Post
    To get a handle on the current situation, Colliers International publishes a quarterly Edmonton Skyline Report. Most recent report is Q3 2014 available here: http://www.collierscanada.com/en/Com...n&rpp=5&page=2

    The report shows the vacancies (tracked by floor) in pretty much every office building in the Downtown and even a few buildings in adjacent areas like Oliver. It can be accessed through a LinkedIn account or be creating an account. It's a huge document (48.5MB) so it may take some time to download depending on your connection speed.
    Cool link, not one I've seen before.
    Based on that info, there certainly isn't 9 floors of space to be shuffled around at Manulife for Enbridge, there will definitely be some tenants packing up into other buildings.

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    Likely a combination of not renewing some leases and re-stacking the tower

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    Anyone remember the 1980s and 1990s?

    We've been here before - several times. Whenever there's a recession or deep government cuts, new space attracts some tenants and some stays vacant for extended periods of time. Those who move into new space vacate older, lower class space. Then companies failing or downsizing vacate space randomly all over the place. There's no great rush downtown because a lot of businesses go into cost cutting mode and simply find cheaper space in the outlying areas.

    Landlords start to offer a year or more of free rent, free something, upgrade the space or whatever. They lobby government to move into their space too. So while everyone says they hate big government, they crave a cut of the spending. There's nothing like a nice cushy long term government lease to pay the bils and pad the wallet.

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    ^you mean $6-9 rents...
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    Quote Originally Posted by 240GLT View Post
    ** except Chancery. Can see that being sold to CRHA or something to that effect
    Working on this one for you
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    Quote Originally Posted by KevinW View Post
    Quote Originally Posted by East McCauley View Post
    To get a handle on the current situation, Colliers International publishes a quarterly Edmonton Skyline Report. Most recent report is Q3 2014 available here: http://www.collierscanada.com/en/Com...n&rpp=5&page=2

    The report shows the vacancies (tracked by floor) in pretty much every office building in the Downtown and even a few buildings in adjacent areas like Oliver. It can be accessed through a LinkedIn account or be creating an account. It's a huge document (48.5MB) so it may take some time to download depending on your connection speed.
    Cool link, not one I've seen before.
    Based on that info, there certainly isn't 9 floors of space to be shuffled around at Manulife for Enbridge, there will definitely be some tenants packing up into other buildings.
    enbridge already has a number of floors in manulife that are included in those 9.
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    Quote Originally Posted by East McCauley View Post
    To get a handle on the current situation, Colliers International publishes a quarterly Edmonton Skyline Report. Most recent report is Q3 2014 available here: http://www.collierscanada.com/en/Com...n&rpp=5&page=2

    The report shows the vacancies (tracked by floor) in pretty much every office building in the Downtown and even a few buildings in adjacent areas like Oliver. It can be accessed through a LinkedIn account or be creating an account. It's a huge document (48.5MB) so it may take some time to download depending on your connection speed.
    Thanks for the resource!

    Out of curiosity, what is the difference between Financial class buildings and Government class buildings?

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    Area they are located in. Financial is CBD, Gov't is sorta 106st west.
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    ^ that's one of MANY differences

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    Quote Originally Posted by kcantor View Post
    Quote Originally Posted by KevinW View Post
    Quote Originally Posted by East McCauley View Post
    To get a handle on the current situation, Colliers International publishes a quarterly Edmonton Skyline Report. Most recent report is Q3 2014 available here: http://www.collierscanada.com/en/Com...n&rpp=5&page=2

    The report shows the vacancies (tracked by floor) in pretty much every office building in the Downtown and even a few buildings in adjacent areas like Oliver. It can be accessed through a LinkedIn account or be creating an account. It's a huge document (48.5MB) so it may take some time to download depending on your connection speed.
    Cool link, not one I've seen before.
    Based on that info, there certainly isn't 9 floors of space to be shuffled around at Manulife for Enbridge, there will definitely be some tenants packing up into other buildings.
    enbridge already has a number of floors in manulife that are included in those 9.
    Right, but on the low end, even accounting for Enbridge already being in the building and them re-organizing everyone else to the best of their ability, there is probably 100k-ish of tenants that will need to find new space.

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    Quote Originally Posted by 240GLT View Post
    ^ that's one of MANY differences
    Not really. The question was asked in the context of a Colliers report. That's the only difference, location.

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    ^ Umm... yes, there are many differences that go well beyond a leasing brochure

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    Quote Originally Posted by 240GLT View Post
    ^ Umm... yes, there are many differences that go well beyond a leasing brochure
    Again, the context of the question WAS that leasing brochure. Quite literally, the difference in that context is location and nothing else. Colliers breaks up each area accordingly to class AA, A, etc, which are the differences you're talking about (there's no AA in the government district, for example). But "government" vs. "financial" is location and nothing more. No different than how they break up suburban office areas to 124 street, 149 street, 118 avenue etc.

    There's no question that in general financial district buildings tend to be larger and higher class, I wouldn't argue otherwise.
    Last edited by Marcel Petrin; 11-12-2014 at 11:30 AM.

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    ^ I didn't read that he was looking for the differences in the context of the Colliers brochure, but if that's what he was looking for, so be it, it's primarily location as far as a leasing agent may be concerned.

    But those of us who manage buildings (especially good ones) know that there are quite a few distinct differences between a fiancial class and a government class building

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    Quote Originally Posted by 240GLT View Post
    But those of us who manage buildings (especially good ones) know that there are quite a few distinct differences between a fiancial class and a government class building
    Such as...?
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    Quote Originally Posted by Sonic Death Monkey View Post
    Quote Originally Posted by 240GLT View Post
    But those of us who manage buildings (especially good ones) know that there are quite a few distinct differences between a fiancial class and a government class building
    Such as...?
    Availability of u/g parking, access to the pedway system, shopping and LRT, quality of HVAC, elevators, and common areas.

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    What? Expand on what the true differences are... that list is hogwash! What you listed basically tells me who is willing to pay X amount for these conveniences that is all but does not differentiate government to financial.

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    Isn't it all kind of subjective? Is there clear criteria that distinguishes AA from A, and so on? My understanding is that the class B, A, AA is somewhat subjective, and that the scale differs for government vs financial, ie what qualifies as class A government space may not necessarily for financial space. The subjective rankings are based on the quality of items laid out by ChrisD.

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    Quote Originally Posted by ctzn-Ed View Post
    What? Expand on what the true differences are... that list is hogwash! What you listed basically tells me who is willing to pay X amount for these conveniences that is all but does not differentiate government to financial.
    Sigh...not hogwash. Read this and you'll know what I'm saying.

    http://www.boma.org/research/Pages/b...finitions.aspx

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    It still does not differentiate the diferences between financial and government which SDM asked. You gave an answer and article that anyone with commonsense could figure out. Just like condos, you have different classifications, so we know there are differences. So, what are the differences between government and financial aside from the government district being older, so obviously, those buildings will be lowered in standards?

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    This isn't related to the current conversation, I just wanted to look at a compact list like this so I thought maybe someone else might too:

    Empty buildings:

    1. BMO - 2014 <--- conversion candidate
    2. 9Triple8 - 2014
    3. CN Tower - 2016
    4. HSBC - 2016
    5. Chancery Hall - 2016 <--- conversion candidate
    6. Enbridge Tower - 2016
    7. Enbridge Place - 2016 <--- conversion candidate
    8. Stantec Technology Centre - 2018
    9. Bell Tower back building - 2018 <--- conversion candidate

    (and maybe provoke a bit of discussion about conversion)
    Last edited by JayBee; 14-12-2014 at 03:45 PM. Reason: mixed up my enbridges
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    Quote Originally Posted by ctzn-Ed View Post
    It still does not differentiate the diferences between financial and government which SDM asked. You gave an answer and article that anyone with commonsense could figure out. Just like condos, you have different classifications, so we know there are differences. So, what are the differences between government and financial aside from the government district being older, so obviously, those buildings will be lowered in standards?
    ...I think Marcel took a good stab at answering this question...in bold italics...

    Quote Originally Posted by Marcel Petrin View Post
    Quite literally, the difference in that context is location and nothing else. Colliers breaks up each area accordingly to class AA, A, etc, which are the differences you're talking about (there's no AA in the government district, for example). But "government" vs. "financial" is location and nothing more. No different than how they break up suburban office areas to 124 street, 149 street, 118 avenue etc.

    There's no question that in general financial district buildings tend to be larger and higher class, I wouldn't argue otherwise.
    Quote Originally Posted by Sonic Death Monkey View Post
    Quote Originally Posted by 240GLT View Post
    But those of us who manage buildings (especially good ones) know that there are quite a few distinct differences between a fiancial class and a government class building
    Such as...?
    The crux of the angst here is classification v location as others have said...

    Classification of a "government" building is a penchant to develop more B/C level product IMO. "Financial" is usually a penchant to develop A and higher. Notwithstanding the generic pigeon holes that this thread espouse (government v financial) which in the Edmonton context are more location based...this does not mean government clients may not once in awhile develop an A/A+ product...and that financial people may have locations that are B and below...

    ...nor does that mean this is exclusive to either. PCL could build an A or higher product for itself if it so chose...are they then "financial"? no...

    Let's just leave the building classifications as they are...and as Chris and others have listed. Let's just call "financial" the area on the map, and "government" the area on the map close to the leg...and know that in each neighborhood, any "class" of building can exist...
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    Quote Originally Posted by JayBee View Post
    This isn't related to the current conversation, I just wanted to look at a compact list like this so I thought maybe someone else might too:

    Empty buildings:

    1. BMO - 2014 <--- conversion candidate
    (...)
    Curious...just how well are these conversions v just simply building new residential product and renovating old office buildings to house offices? From what I see, these highrise conversions are not going over so well...
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    I know the ex-St Joseph Hospital on Whyte Ave and the Cambridge Downtown have been good successes both for residential and retail. I don't know as much about The Ten Downtown, but I haven't heard about issues.

    I've heard the tenants of the MacLeod building have had issues but not anything like Penhorwood class issues.

    Just by the by, you included BMO in what you quoted of me, but my thought for BMO is it might make better retail, not necessarily residential.
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    Quote Originally Posted by RichardS View Post
    Quote Originally Posted by JayBee View Post
    This isn't related to the current conversation, I just wanted to look at a compact list like this so I thought maybe someone else might too:

    Empty buildings:

    1. BMO - 2014 <--- conversion candidate
    (...)
    Curious...just how well are these conversions v just simply building new residential product and renovating old office buildings to house offices? From what I see, these highrise conversions are not going over so well...
    Conversions can work reasonably well, although not ideal sometimes. I expect most on that list to remain office with the exceptions being Chancery for mixed use and BMO for retail or mixed retail office.
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    Quote Originally Posted by ctzn-Ed View Post
    It still does not differentiate the diferences between financial and government which SDM asked. You gave an answer and article that anyone with commonsense could figure out. Just like condos, you have different classifications, so we know there are differences. So, what are the differences between government and financial aside from the government district being older, so obviously, those buildings will be lowered in standards?
    1. Location.
    2. Many of the buildings in the Government District are not linked by a pedway or underground walkway system.
    3. Limited access to the LRT network.
    4. The buildings generally have smaller common areas and amenities.
    5. There is limited direct access to major shopping and retail areas.
    6. Buildings are generally smaller in size and are not home to many 'blue chip' tenants (e.g. financial, legal and insurance companies).

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    Quote Originally Posted by JayBee View Post
    (...)

    Just by the by, you included BMO in what you quoted of me, but my thought for BMO is it might make better retail, not necessarily residential.
    ...I try to keep quotes short...hence the (...) elipsis at the end. If one wants your full list, it is just above. No intent was made to single out one building v another on your list.

    Quote Originally Posted by IanO View Post

    Conversions can work reasonably well, although not ideal sometimes. I expect most on that list to remain office with the exceptions being Chancery for mixed use and BMO for retail or mixed retail office.
    ...conversions can...but I hear and see more horror stories than not...

    In a market where building net new is still really feasible given our abundant open land even downtown, retros aren't as necessary or economically viable IMO. In a place that has huge demand, density, and no new land...then the equation seems to make more sense and people put more into the conversion...
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    Horror stories? In Edmonton?

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    Keep ^in mind who did many of them, most are doing well now from accounts.
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    Yeah, a few of the conversions do have issues, because they were done by poor developers, sometimes with poor consultants and poor contractors (or just contractors who don't normally do that kind of work). Even Phillips Lofts was left stuck with an absolutely atrocious mechanical system that is not easily fixed, designed by a mechanical consultant who has long since gone out of business.

    Worthington...

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    Bingo!
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    I must have been away when this came out, but Richard was asking about highrises, has that happened?


    Quote Originally Posted by IanO View Post
    Quote Originally Posted by RichardS View Post
    Quote Originally Posted by JayBee View Post
    This isn't related to the current conversation, I just wanted to look at a compact list like this so I thought maybe someone else might too:

    Empty buildings:

    1. BMO - 2014 <--- conversion candidate
    (...)
    Curious...just how well are these conversions v just simply building new residential product and renovating old office buildings to house offices? From what I see, these highrise conversions are not going over so well...
    Conversions can work reasonably well, although not ideal sometimes. I expect most on that list to remain office with the exceptions being Chancery for mixed use and BMO for retail or mixed retail office.
    I think the Bell Back Building could be a retail candidate as well, due to its form and proximity to EAD, while Enbridge Place will be caught in the flurry of 2016 vacations, and having the smaller floorplates it seems a good candidate for residential. Keeping in mind the Stantec, Edmonton, and KR could still have significant blocks of availability.
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    ^ Something will happen to the old Centre Club space and it won't be office use. That space is awkward for what it's currently being used for anyways.
    h
    The rest of them will stay as office uses, except for Chancery, which as noted, will likely be turned into apartments

    KR's got four floors left, Stantec and the city both around 100k sf I think

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    Enbridge and former ING will undergo a top to bottom reno is my prediction to prepare them for the next 30yrs.
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    Quote Originally Posted by JayBee View Post
    I must have been away when this came out, but Richard was asking about highrises, has that happened?
    Worthington did Cambridge Lofts as well, did they not? There have been some growing pains there as well, I believe. I don't recall who did the Ten, nor McLeod (was Dub involved?). Procura did Park Square, and that one's solid from what I'm aware. Otherwise, what other high rise conversions have there been?

    I think that conversions done properly by the right people can make sense, but not every conversion will. Sometimes there's particular limitations of the building, and in general the only thing you're really saving from the existing building is the structure and envelope, relative to building new. I would imagine that often those cost savings can be offset by the additional costs of demolition and retrofitting the building to work for an entirely different purpose. And you're stuck with the limitations particular to that building. Balconies, for example, which for some people is a pretty big limitation. I'd never buy a condo where I can't have a BBQ, personally.

    And as Richard said, it's not like we have a massive shortage of development ready land in most of our core. Maybe in the financial district there's not a lot of room left, but residential doesn't really make a lot of sense there anyways. Meanwhile west of 105 street there is an absolutely massive amount of empty lots ready to go.
    Last edited by Marcel Petrin; 15-12-2014 at 09:02 AM.

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    Ten was Worthington, McLeod was Gene. Worthington also did the Executive Lofts on 9th and the Liberty on Jasper if I recall.
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    heh, yeah, so a horrible developer did the vast majority of the conversions. No wonder some are having problems!

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    Quote Originally Posted by IanO View Post
    Enbridge and former ING will undergo a top to bottom reno is my prediction to prepare them for the next 30yrs.
    Hopefully both of them completely re-imagine their interaction at street level, similar to the EPCOR re-do.

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    Specifically former ING... sickening street interaction and mostly opaque film.
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    There used to be a resto-lounge on the north side of the ING lobby until about the late-90s (name escapes me). Apparently that's been used as storage space for years. A pity really, that would be a good spot for a coffee bistro with a patio. Unfortunately that entire block of 103 St is a pedestrian dead zone.
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    Which was good for Top_Dawg when he wanted to go incognito.

    Years ago he had to check in weekly with his PO at ING.

    And she would yell at poor Top_Dawg and lecture him that he was not abiding by his release conditions.

    Top_Dawg would act all contrite and promise to do better.

    Then down the elevator, out the door, and straight down the street to the Grande Tavern.



    Can't tame the Top_Dawg.

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    ^^
    Yeah it went through a few incarnations over the years.

    Last one was Shecky's or something like that.

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    Shecky's sounds about right.
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  55. #55

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    I think there was a restaurant named Amandine or something on the second floor.

    Sure would be nice for the street if it became residential.
    Last edited by JayBee; 15-12-2014 at 11:38 AM.
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    ^no residential please. We need it to be employment...
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    That building is still relatively new and is pretty close to modern spec. It's also seen a fair amount of capital work over the past ten years. There will be no interest in converting that building to residential any time soon

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    The City of Edmonton also has a presence in Century Place. Not sure how much, or if they'll be part of the move, but another tower to keep an eye on.

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    The City owns Century Place, and I understand will keep it full.

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    ^^^ & ^^^^: fair enough.
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    Quote Originally Posted by highlander View Post
    The City owns Century Place, and I understand will keep it full.
    Correct

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    Quote Originally Posted by tristin.deveau View Post
    HSBC Place
    A smaller tower, but well connected to Manulife and the Oxford towers via City Centre. The City of Edmonton is currently the primary tenant.
    Word around the SSP campfire is a possible repurpose to a hotel. This would make sense, given its proximity to ECC, Ice District and a parkade. They would have to clear out the HSBC bank branch, some retail such as the jeweller and create a drop-off zone on either 101 St or 103 Ave.
    “You have to dream big. If we want to be a little city, we dream small. If we want to be a big city, we dream big, and this is a big idea.” - Mayor Stephen Mandel, 02/22/2012

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    Yup, although I have also heard this is not happening...
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  64. #64

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    I know Dream has had significant difficulty in leasing HSBC Place so it's not necessarily a terrible idea...

  65. #65

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    Is this that glass tower next to and north of the mall?
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    I was told to "Look for more on this in the future"...repurposing to a hotel would make sense. Great location, connected to the pedways, next to the financial core, ICE District, great parking, has space on the second level of the podium for conference/meeting rooms. HSBC could be easily relocated.

  67. #67

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    ^^
    Disregard.

    If that becomes a hotel, I wonder if that would affect the current Bacarat site with Katz plans for the second hotel?
    Last edited by ctzn-Ed; 01-08-2016 at 08:34 AM.
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    I would love any breath of new residential on 101 Street, be it condo, rental, or hotel, if only so the street doesn't get so deserted and there's a little less legitimate reason to close the malls so early.


    But if hotel, it would be another bellwether showing that our Downtown truly is coming back to some level of relevance in Western Canada. Would be more indicator than leader, but a welcome sign of progress.

    ^ I don't think it would affect the Katz Group plans for a hotel on the Baccarat site much, if at all. Katz Group are certainly able to "anchor" and "lead", but while it depends what Dream does specifically, I imagine this site more "following" or "catching the overflow."
    Last edited by JayBee; 01-08-2016 at 08:53 AM.
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    In regards to the hotel, I hope so as we have a brand new one about to open and one under construction, one proposed ; Katz potential 2nd, and existing stocks. I'm more in favor of condos/ rentals to bring permanent and consistent mass there. A hotel is a hit and miss for the mass factor.
    " The strength of a man is in the stride he walks."

  70. #70

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    I don't think Dream intends to go residential with HSBC Place. I know they are offering some incredible deals for prospective tenants. I've heard rumblings such as two years of free rent (only op. costs paid by the tenant) and then it jumps to market rate.

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    ... with a report on the G&M today about how commodity price Provinces are going to be quite weak for rates, yields and occupancy over the next 2-3 yrs.
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    From Colliers.com









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  73. #73

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    ^ handy, thanks for posting.

    I wonder when they start diagramming Stantec Tower? They've already started diagramming the effect it will have in upcoming vacancies. Would be nice to see it all on one page.
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    Interesting morning breakfast presentation from the DBA's MBA student on office conversions. Whether mixed use or to hotel or resi, there certainly is some good opportunity right now. Expect to see a few go that way...

    The presentation will be hosted here shortly:

    http://www.edmontondowntown.com/about.php?sid=83

    We also had a presentation by Randy Ferguson of Strategic Group on The Baron building conversion to boutique hotel in Calgary, the various potential opportunities with CN and the potential with a couple of buildings in the Downtown.
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    Edmonton Downtown Business Association report touts benefits of refurbishing old highrises

    CLARE CLANCY

    Edmonton’s vacant office towers could be turned into residential space, hotels or even multi-floor gardens, a new report suggests.

    “Instead of breaking buildings down and doing major renovations, it’s easier to have temporary, environmentally friendly, low-cost conversions that you can always change a few years down the line,” said the report’s author, Satish Narayanan.

    His report released Thursday by the Downtown Business Association highlighted seven towers around the world that have been successfully revamped after sitting vacant for more than five years. Approaches included turning office space into university housing, retail space and multi-generational dorm-style living. In Japan, a recruitment company incorporated an urban farm into its building, growing vegetables, fruit and rice.

    Edmonton’s business community should assume that buildings will serve multiple uses during the next decade, Narayanan said, adding that conversions will fail if the needs of the city aren’t carefully evaluated.

    http://edmontonjournal.com/business/...-old-highrises
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  76. #76

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    ^Like the idea of them being converted into residential spaces but multi-floored gardens. How would that work. Would humidity and bugs not be a problem?. Humidity caused by watering the plants could cause major mould problems. Bugs, even those beneficial to that kind of environment would linger in the building for a long time. Using them for multi-floored gardens would be such a waste. I could see a multi-floored open parking lot being used for gardens but not a building.
    Gone............................and very quickly forgotten may I add.

  77. #77

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    Affordable housing is one option as the possibilities are endless.

  78. #78

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    This very much smells like "OMG we're getting seriously over-built!" Are there any new companies or populations moving into town to take up some of this new space or is it just cannibalizing what exists now?
    I am in no way entitled to your opinion...

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    ^ That's always been the biggest disappointment for me with all these new office tower developments, that they have only resulted in lateral movement among existing downtown tenants instead of attracting more head offices from outside downtown and from other cities. True, some companies are now moving from the suburbs, but we've lost so many HOs to other cities over the past few decades and it's high time this trend was reversed. Though with the economy being what it is in this province, I'm not so hopeful that will happen.
    “You have to dream big. If we want to be a little city, we dream small. If we want to be a big city, we dream big, and this is a big idea.” - Mayor Stephen Mandel, 02/22/2012

  80. #80

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    ^ not quite. With the vacancies of the ex-ATB tower and the ex-EPCOR tower, there has been a cascade of movement resulting in several (mostly engineering) firms moving Downtown from the suburbs.

    Intuit also moved Downtown, but due instead to the new EPCOR Tower.

    Not from other cities (yet?) but the Stantec tower may have stopped one of our best companies going to another city.

    Furthermore, there aren't any really large blocks available in the CBD for the taking, and only "B" class in the government district. There needs to be empty space to see what happens, but we have to wait until next year, really, for that to happen (HSBC, Enbridge Tower, Enbridge Place), plus the time it would take for renos.
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  81. #81

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    Couldn't agree more Jaybee. We have to move off of the position of which market do we steal from in order to define success. Instead let's evolve to find success - not all buildings are meant to be the same use as originally intended. Just as not all locations will work for a company indefinitely. A lateral move from one building to fill another has been the way this market has been for decades and we need to move past the fantasy of bringing in head offices from other cities. It would be nice but don't be saddened to not see it happen.

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    The Great Downtown Shift is Coming
    With new office towers at the ready, what will Edmonton do with all of its new commercial space? Converting older buildings is an answer.

    BY STEVEN SANDOR

    The Stantec Tower, all 62 storeys of it, should be complete in two years. The Kelly Ramsey Tower, which already boasts heavy hitters like KPMG and Enbridge as tenants, is offering leases. The EPCOR Tower still is leasing space.
    These new towers will change not only the city’s skyscape, but the nature of Edmonton’s downtown. And, it’s time for landlords to start looking at alternative uses for some of the ageing commercial buildings in the core.

    That’s the clear message from the Downtown Business Association’s meeting Thursday morning. University of Alberta student Satish Narayanan presented the findings of his study on how Edmonton office buildings can be converted for other uses.

    “Our job is to bring more people to the city centre,” he said.

    Narayanan said that Edmonton’s commercial vacancy rate jumped from 9.83 per cent in the first quarter of this year to 15.3 per cent in the second. Because new office spaces are available, what we’re seeing is business moving to the shiny towers — and leaving the old digs behind, with no one left to fill it.

    He talked about projects in Europe, the United States and Australia where vacant buildings have been transformed into suites, lofts or student housing. In one example, a vacant commercial building in Amsterdam was converted into a mix of student dorms and a four-star hotel. The students staying in the dorm work at the hotel.
    Jim Taylor, executive director of the Downtown Business Association, said there are several ways to address the changing nature of the core.

    http://www.avenueedmonton.com/Septem...ift-is-Coming/
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  83. #83

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    Won't these new uses just draw people out of other existing buildings, leaving them to be converted into something else, and on and on? Without significant population/corporate inflow aren't we just rearranging deck chairs?
    I am in no way entitled to your opinion...

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    Hence going after other uses for outdated stock.
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  85. #85

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    What uses other than more commercial and more residential space though? That Avenue article doesn't offer much more than that except for a dorm/hotel run by students.

    Because new office spaces are available, what we’re seeing is business moving to the shiny towers — and leaving the old digs behind, with no one left to fill it.
    Where will those someone-s be coming from?
    I am in no way entitled to your opinion...

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    I think outside firms might see downtown Edmonton with more interest.

    My thinking is that the B or C class building space could hurt.
    Last edited by The_Cat; 01-09-2016 at 02:04 PM.
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    ^

    out of curiosity, are you considering a move to high level, alberta or eyebrow saskatchewan or port greville nova scotia because houses are cheaper and rents less than in edmonton? businesses don't move for cheap rent either or at least not the sort of businesses you want to attract because if that's all their interested in then they'll leave as quickly as they came...

    the places most businesses want to locate - or at least those businesses you want - are chosen for business reasons, not rental levels. that's why rents in those cities are the highest, not the lowest (i.e. san francisco, new york, london, zurich, singapore etc.).
    "If you did not want much, there was plenty." Harper Lee

  88. #88

    Default Downtown office vacancies

    Quote Originally Posted by The_Cat View Post
    I think outside firms might see downtown Edmonton with more interest.

    My thinking is that the B or C class building space could hurt.
    I think you are right on both counts. Over the years, one of the things large corporations have said is they had trouble finding quality space of the right size in downtown Edmonton. It may have been a factor in some companies not expanding their Edmonton offices or getting more office space elsewhere in Alberta.

    However, there will also be local corporations that will look at the nicer new office space and decide to move from older buildings. I think every owner of an older building needs to have a good plan to deal with this one (ex. upgrade or convert old office space to another use). If they don't they will get hit hard when the new space becomes available.

  89. #89

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    Quote Originally Posted by Spudly View Post
    Won't these new uses just draw people out of other existing buildings, leaving them to be converted into something else, and on and on? Without significant population/corporate inflow aren't we just rearranging deck chairs?
    Quote Originally Posted by Spudly View Post
    What uses other than more commercial and more residential space though? That Avenue article doesn't offer much more than that except for a dorm/hotel run by students.

    Because new office spaces are available, what we’re seeing is business moving to the shiny towers — and leaving the old digs behind, with no one left to fill it.
    Where will those someone-s be coming from?

    It's hard to say what exactly the market will decide in the future, but the last major increases to our office space stock (EPCOR Tower, Federal Building, and Telus contraction) resulted in three older buildings being upgraded (KRP, Jacobs, WSP) and the net increase in available space being taken by several companies moving in from the suburbs and numerous others expanding. As a result right now there are only three significant blocks available (Financial Building, Highfield Place, and about 5 floors in EPCOR), and we have one brand new and 5 nicely renewed buildings which make our city a significantly better place to work.

    On the immediate horizon we've got a similar situation in terms of new spaces on the market (Kelly Ramsey and Edmonton Tower instead of EPCOR, Federal, Telus), so to some extent I'd expect a similar result:

    1. Renovations to older buildings to compete (Scotia, HSBC, Enbridge Tower, Enbridge Place)
    2. Movement from suburbs
    3. Organic expansion
    4. Some holes
    5. A significantly better city to work



    Of course your focus is on the holes, but there are other things in there which are great, and point 5, I think you'd agree, is probably the best thing to keep in mind.

    Some buildings, probably not the ones listed, will probably be converted into residential, and yes the Downtown rental population has had its downs and ups, but the market will respond, and a lot of people currently renting in the suburbs will take the opportunity to relocate into that vacancy, as its also become a better place to rent.

    Then three years later we discuss Stantec.
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  90. #90

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    ^Yah the last 2 years I've met several people who have moved downtown cause it's becoming a better place to live. These people have no work downtown and have to reverse commute out. So that's quite encouraging.

  91. #91

    Default Downtown Office Tower Vacancies

    Overall, I think the city has grown by a lot more in the last 20 to 30 years than the supply of downtown office space, so I would argue we are not necessarily just rearranging the deck chairs. I look at it as downtown catching up to the rest of the city and the region. I also think with its old and limited downtown office stock, Edmonton has not been in a good position to take much advantage of corporate inflow for decades. This could change soon.

    There are a number of uses old office space can be put to - hotels and seniors housing come to mind as well as rental accommodation and space for not for profit organizations. As the LRT system expands being in a central location works better for more people, but not everyone can afford or wants a deluxe condo.

    Quote Originally Posted by JayBee View Post
    Quote Originally Posted by Spudly View Post
    Won't these new uses just draw people out of other existing buildings, leaving them to be converted into something else, and on and on? Without significant population/corporate inflow aren't we just rearranging deck chairs?
    Quote Originally Posted by Spudly View Post
    What uses other than more commercial and more residential space though? That Avenue article doesn't offer much more than that except for a dorm/hotel run by students.

    Because new office spaces are available, what we’re seeing is business moving to the shiny towers — and leaving the old digs behind, with no one left to fill it.
    Where will those someone-s be coming from?
    It's hard to say what exactly the market will decide in the future, but the last major increases to our office space stock (EPCOR Tower, Federal Building, and Telus contraction) resulted in three older buildings being upgraded (KRP, Jacobs, WSP) and the net increase in available space being taken by several companies moving in from the suburbs and numerous others expanding. As a result right now there are only three significant blocks available (Financial Building, Highfield Place, and about 5 floors in EPCOR), and we have one brand new and 5 nicely renewed buildings which make our city a significantly better place to work.

    On the immediate horizon we've got a similar situation in terms of new spaces on the market (Kelly Ramsey and Edmonton Tower instead of EPCOR, Federal, Telus), so to some extent I'd expect a similar result:

    1. Renovations to older buildings to compete (Scotia, HSBC, Enbridge Tower, Enbridge Place)
    2. Movement from suburbs
    3. Organic expansion
    4. Some holes
    5. A significantly better city to work



    Of course your focus is on the holes, but there are other things in there which are great, and point 5, I think you'd agree, is probably the best thing to keep in mind.

    Some buildings, probably not the ones listed, will probably be converted into residential, and yes the Downtown rental population has had its downs and ups, but the market will respond, and a lot of people currently renting in the suburbs will take the opportunity to relocate into that vacancy, as its also become a better place to rent.

    Then three years later we discuss Stantec.

  92. #92

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    So then, all the migration still looks like it's coming from somewhere else in the city, pushing vacancies down the Class A-B-C-D stack. Point 5 is nice to think about, but how does someone living and working in the other 99% of the city feel that significant difference?

    My interest is in the holes because I've seen this happen through 3 booms already and the lots of holes that came after boom-time building. When Stantec moves, they're going to leave a Stantec-sized hole, like their 4 towers on Jasper/112th (at least), in not-downtown. Those 2 towers on Jasper were the result of prior boom-bust and took quite a while to reactivate. Are we just hoping the oil taps turn on again to make Edmonton a place to head to again? An explosion of clerks and managers to administer the new Carbon Tax? Windmill/Solar people? Another Stantec?

    My interest isn't in the holes because I want to be a pissy old goat and argue, but my work involves risk-analysis-oriented activities and this sudden bloom of New Shiny makes my spider sense tingle, like deja vu all over again. And then I want to know more.

    Does anyone have projections on what might be coming down the pipe? Or is the realty biz hoping and waiting? Somebody must be number-crunching this stuff or have a seasoned veteran's insight. Out my window will be nearly 100 floors worth of residential in 4 towers within 4 blocks in the next couple years. What's driving that market? Or will we be seeing those lots sit idle for a while, or unfinished?
    I am in no way entitled to your opinion...

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    Quote Originally Posted by Spudly View Post
    So then, all the migration still looks like it's coming from somewhere else in the city, pushing vacancies down the Class A-B-C-D stack. Point 5 is nice to think about, but how does someone living and working in the other 99% of the city feel that significant difference?

    My interest is in the holes because I've seen this happen through 3 booms already and the lots of holes that came after boom-time building. When Stantec moves, they're going to leave a Stantec-sized hole, like their 4 towers on Jasper/112th (at least), in not-downtown. Those 2 towers on Jasper were the result of prior boom-bust and took quite a while to reactivate. Are we just hoping the oil taps turn on again to make Edmonton a place to head to again? An explosion of clerks and managers to administer the new Carbon Tax? Windmill/Solar people? Another Stantec?

    My interest isn't in the holes because I want to be a pissy old goat and argue, but my work involves risk-analysis-oriented activities and this sudden bloom of New Shiny makes my spider sense tingle, like deja vu all over again. And then I want to know more.

    Does anyone have projections on what might be coming down the pipe? Or is the realty biz hoping and waiting? Somebody must be number-crunching this stuff or have a seasoned veteran's insight. Out my window will be nearly 100 floors worth of residential in 4 towers within 4 blocks in the next couple years. What's driving that market? Or will we be seeing those lots sit idle for a while, or unfinished?
    Natural population growth and organic business growth will fill space.

    There are hundreds of firms in the city none of us have ever heard of. Only one needs to make it big. It will probably be in a field unknown to us today.

  94. #94

    Default

    Quote Originally Posted by Spudly View Post
    So then, all the migration still looks like it's coming from somewhere else in the city, pushing vacancies down the Class A-B-C-D stack. Point 5 is nice to think about, but how does someone living and working in the other 99% of the city feel that significant difference?
    First of all if our labour force is 830k, and Downtown employment is 80k, your 99% is closer to 90%.

    That aside, the people whose opinions it will affect are those who have the ability to choose where they work. If this becomes a more desirable place to work than historically it had been, we are on the right track. It is not simply a trend, but a structural aspect of the economy that we haven't "enjoyed" since before Lougheed.


    My interest is in the holes because I've seen this happen through 3 booms already and the lots of holes that came after boom-time building. When Stantec moves, they're going to leave a Stantec-sized hole, like their 4 towers on Jasper/112th (at least), in not-downtown. Those 2 towers on Jasper were the result of prior boom-bust and took quite a while to reactivate. Are we just hoping the oil taps turn on again to make Edmonton a place to head to again? An explosion of clerks and managers to administer the new Carbon Tax? Windmill/Solar people? Another Stantec?

    My interest isn't in the holes because I want to be a pissy old goat and argue, but my work involves risk-analysis-oriented activities and this sudden bloom of New Shiny makes my spider sense tingle, like deja vu all over again. And then I want to know more.
    It sounds like you're discussing Downtown fabric and not economic strategy, but in that case, the evolution of Downtown has taken it in an extremely different direction than it was in the bust of '81 or in the bust of '95. Three huge differences now:

    1. People live in large numbers there again
    2. People will soon be entertained in large numbers there again
    3. People will soon flow through/past on mass transit in large numbers again



    We're becoming something like "real cities" are, and a natural turnover in office space that we see now is not only "normal" but it is quite unlike anything we saw in the "bleeding era" from the '70s to the 2000s.


    Does anyone have projections on what might be coming down the pipe? Or is the realty biz hoping and waiting? Somebody must be number-crunching this stuff or have a seasoned veteran's insight. Out my window will be nearly 100 floors worth of residential in 4 towers within 4 blocks in the next couple years. What's driving that market? Or will we be seeing those lots sit idle for a while, or unfinished?
    I'd fully expect all three ICE District towers plus Encore to finish and become habitable, as well the crucial streetscape improvements in their podiums.

    After that, it will depend partly on the economy, but I do think The Pearl demonstrated we've become a place than can put up a condo tower even in a recession.

    Perhaps not at the hectic pace we see now, but I 'project' a very different, more positive Downtown evolutionary path than we've seen since the '60s regardless the economy.
    Let's make Edmonton better.

  95. #95

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    Quote Originally Posted by The_Cat View Post
    I think outside firms might see downtown Edmonton with more interest.

    My thinking is that the B or C class building space could hurt.
    That's what tends to happen, the A grade space gets filled (albeit at big discounts), but the B and C starts emptying. The hope is buildings are repurposed as lofts, not converted into gravel lots, which sadly has more often (not in all cases) been the result of past busts after booms. The population decline in downtown is a bad sign, which concerns me, I have always thought the key to making Edmonton downtown more vibrant lies in condo's not office space. I think its poor city planning re where Council is allowing the city to endlessly grow at much faster rates, but others are more fatalistic, or perhaps "optimistic" that somehow what has been a repeated trend can change without a change in urban policies (e.g. implementing a prioritized neighbourhood growth plan instead of just hoping it will happen). That suburban office space is retaining higher leases is IMO a symptom of that lack of control leading to the continued higher desirability of SW neighborhoods, even for condos now, but time will tell. If you want to invest in a condo to rent out in Edmonton now, the place to do and make money, is Windermere, not downtown. That needs to change.
    Last edited by moahunter; 02-09-2016 at 08:13 AM.

  96. #96

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    ^The city should exert more restraint with schools and transit.

    Stop building sprawl schools (emptying out inner city schools). Stop extending transit service and improve core routes. They can even reduce the snow plow SLA for sprawl neighborhoods until they are fully built out. Then tell people that if they want a raise their family in a big house on the edge of the city, be prepared to spend their time, money and patience driving their kids around everywhere.

    Residents will have to make the decision between square footage or quality of life. Right now, most people just consider square footage and feel entitled to QoL improvements.

  97. #97
    C2E Long Term Contributor
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    Don't mess with the system, the system is what everyone wants!
    www.decl.org

    Ottawa-Edmonton-Vancouver-Edmonton

  98. #98
    I'd rather C2E than work!
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    Quote Originally Posted by moahunter View Post
    Quote Originally Posted by The_Cat View Post
    I think outside firms might see downtown Edmonton with more interest.

    My thinking is that the B or C class building space could hurt.
    That's what tends to happen, the A grade space gets filled (albeit at big discounts), but the B and C starts emptying. The hope is buildings are repurposed as lofts, not converted into gravel lots, which sadly has more often (not in all cases) been the result of past busts after booms. The population decline in downtown is a bad sign, which concerns me, I have always thought the key to making Edmonton downtown more vibrant lies in condo's not office space. I think its poor city planning re where Council is allowing the city to endlessly grow at much faster rates, but others are more fatalistic, or perhaps "optimistic" that somehow what has been a repeated trend can change without a change in urban policies (e.g. implementing a prioritized neighbourhood growth plan instead of just hoping it will happen). That suburban office space is retaining higher leases is IMO a symptom of that lack of control leading to the continued higher desirability of SW neighborhoods, even for condos now, but time will tell. If you want to invest in a condo to rent out in Edmonton now, the place to do and make money, is Windermere, not downtown. That needs to change.
    AA-class space in new buildings is NOT being discounted. A flight to quality is what we're seeing in our market as tenants like Stantec, KPMG, etc are looking at newer buildings with newer amenities and are paying the rates. Existing A-class buildings are having to offer inducements to retain/attract tenants. The B and C-class market is what it is. It is the cheaper alternative with some buildings holding their own with respect to rates and vacancy. Other buildings that are dated will struggle.

    The downtown population decline is primarily the result of higher apartment vacancies versus those in owner-occupied units moving out. While I still question how that number was derived we are seeing a greater number of condominiums added to the overall downtown market.

  99. #99

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    Lol.

    Clearly it's AA that's building the new towers, but ha ha, oh well...
    Let's make Edmonton better.

  100. #100
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    Quote Originally Posted by IanO View Post
    Don't mess with the system, the system is what everyone wants!
    True.

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