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Some developers in Edmonton are currently building warehouses following the Trans Mountain Pipeline Expansion Project, suggests a new report on the real estate market in the area.
"I think the market itself is stabilized, there are areas that still cause a little more concern, but I think most of the time we are going through the worst. We have gone through a difficult time, but we will not faint, "said Dave Young, Executive Vice President and General Manager of CBRE Real Estate and Investment Services, this week.
The expansion of the pipeline creates jobs, and the jobs require space, Young said, adding that the latest numbers are cautiously optimistic.
Edmonton has 1.9 million square feet of industrial products currently under construction. In the second quarter, 672,802 square feet of new industrial space became available in Edmonton, the majority of which was completed with the completion of MTE Logistix's 500,000 square foot warehouse.
"In anticipation of the significant demand for warehouse space resulting from the Trans Mountain Pipeline Expansion Project, some developers are considering launching projects on a speculative basis," notes the CBRE report.
And with an availability rate of 8.2%, "our industrial market is very healthy," says Young.
The National Energy Board (NEB) paved the way for the resumption of construction of portions of the Trans Mountain Project between Edmonton and Metro Vancouver by re-validating all orders and decisions received prior to 39, cancellation of its permits last year.
But Edmonton is not a single pony, Young points out.
"We are only third in Toronto and Vancouver in terms of economic diversification," he said, noting that part of this diversification would come from setting up a network of technology companies. implanted locally.
The Vancouver and Toronto Technology Centers now share the title of the most popular office markets in North America. Vancouver's vacancy rate fell to 2.6 per cent in the second quarter of 2019 from only 4.7 per cent a year earlier. The CBRE report indicates that the Toronto office vacancy rate remained stable at 2.6%, despite the construction boom in the downtown core.
"There must be this network or this ecosystem. Toronto, Vancouver, Montreal, they have it and continue to enlarge it. We are now starting to see him. In the future, I think more technology companies will choose our market, not because of the price of the offices, but because of the ecosystem, "Young said.
New technologies in the energy sector, and particularly in artificial intelligence, will be essential for Edmonton, Young said. Research and human resources from the University of Alberta, NorQuest, MacEwan University and the Northern Alberta Institute of Technology (NAIT) strengthen Edmonton's perspective.
The report also shows increased interest from technology companies in quality offices in downtown Edmonton, including software and research and development firms. Many tenants are looking for newer and more efficient offices, making some older buildings obsolete. They also seek to position themselves alongside similar and complementary companies, particularly in the technology sector, said Young.
And while the vacancy rate in the Edmonton office market was increasing, the report notes that more suburban office space has been leased (approximately 30,984 square feet) compared to the market available to the public. market in the second quarter of 2019.
"The market is picking up momentum from last year, when the market recorded its first positive annual absorption since 2015, and there is optimism for suburban badets," the report says.
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