Commercial real estate sales volume in Edmonton grew 12% in 2016. The office sector had higher vacancies and the multi-family market shifted, but confidence in the retail sector is on the rise. As the City recovers from declining oil prices, a mixed bag of up and down performance is expected for 2017.
Retail has Best Year Since 2013
The retail sector had its best year since 2013 with 101 total transactions, totaling $524 million. This marked a 172% increase from the previous year in 2015. A strong retail market has resulted in some downtown development plans gaining new life. A new look at 100 Acres and the Quarters may bring even more growth.
The City of Edmonton planners have a vision for the downtown area. They want to see it become an environmentally sustainable and walkable community with office space, boutique shops and plenty of homes. The overall vision did hit a road block, but many investors have entered into the picture helping to push the vision for the downtown area forward.
The owner of National Cappuccino, Jim Oilvieri, recently purchased and renovated an aging building near 9th Street and 102 Avenue, and he is just one of the many investing in the downtown retail market. With no signs of the retail market fading, more investors are expected to step up. The Brewery District is nearly completed, which may become the benchmark for downtown retail development.
Industrial Sector also on the Rise
Along with the strong retail market, the industrial sector of Edmonton posted gains last year in 2016. With 142 total transactions, work more than $600 million, a 47% increase was seen last year compared to 2015. These gains are expected to continue in 2017.
Top energy companies are opening up their wallets this year. Suncor Energy has created a $5.2 billion spending program, while Cenovus Energy has $1.4 billion they plan to invest in oil sands projects. In addition, the expansion pipeline project was approved and started. It’s expected to benefit the industrial sectors by piping more Alberta oil to the Vancouver coast.
Edmonton expects to see more gains within the retail and industry sectors of commercial real estate throughout 2017. The mixed-bag market may have seen the office sector and the multi-family sector slow. However, the retail sector is growing stronger with each day and the industrial sector has the momentum to bounce back even stronger in 2017.