Frantic construction to pay big dividends
Mario Toneguzzi, Calgary Herald
Published: Saturday, June 23, 2007
Calgary's frenzied pace of downtown construction may be causing some frustration and inconvenience for people and business in the short-term, but the long-term impact on the city will far outweigh today's woes.
More than half the entire country's downtown office construction is currently taking place in Calgary and that's becoming more and more obvious each day with traffic congestion, road closures and scarce parking availability becoming an almost daily headache.
But that construction activity will dramatically transform Calgary's downtown.
"I think we're becoming very metropolitan. We're much more than a cowboy town. We really are," said Maggie Schofield, executive director of the Calgary Downtown Association.
"I think the biggest thing is the amenities and really moving us into a world-class city and I think we're well on our way. . . . The whole cosmopolitan, metropolitan city is really where we're heading, fast and furious.
"It's a really, really exciting time to be part of Calgary. There's frustration with it. There's always pros and cons."
The biggest issue for downtown retailers these days is parking -- or the loss of spots because of the magnitude of construction.
"Certainly, the retailers are concerned. We always go back to parking. Short-term parking is our big, big focus and that's the area that the retailers are struggling with a bit," said Schofield.
"During the weekday, it's difficult to find a spot. . . . We need to be able to have people come and go and do their business, whether it's an insurance business, whether it's retail, shopping, whatever it may be."
Weekends and evenings are a different story, she said, because there are many parking lots that are accessible and cheap.
Sandra Neill, vice-president of research and communications, of the family-owned Encorp Inc., which owns Art Central, said construction that has begun on EnCana's The Bow, a 58-storey office tower, has made it more difficult for customers, especially if they are driving, to get to Art Central, which is located across the street from the megaproject.
Art Central houses 57 individual studios, galleries, shops and cafes.
"I know on weekends there seems to be even more construction. So it's even more difficult and also because of the construction there's less parking," said Neill. "It is affecting (business) for sure.
"But it's all good in the long term. We're excited about the EnCana building and the development of 7th Avenue and the whole area. So I think the benefits outweigh the negatives in the short-term."
According to real estate firm Avison Young, in its Calgary Office Market Report for the second quarter of 2007,
there are currently 14 office buildings under construction, containing nearly 7.5 million square feet in downtown Calgary, and another five buildings, containing a further 2.4 million square feet, preparing to begin construction in the next 12 to 18 months.
Adam Legge, director of research and business information at Calgary Economic Development, said the organization has not heard about any specific impacts to business due to the amount of downtown construction.
"Obviously everyone knows that it's a little inconvenient while construction is happening, but hopefully the long-term view is that it's going to provide much-needed office space and I think the bigger detriment to the business community would be if we didn't have new space coming on and companies were still forced to pay escalating rents and forced to be in really cramped quarters," said Legge. "To me that would be the bigger business impact.
"There's so much employment that happens in the core that business will continue to operate on a day-to-day basis without probably a huge change in people demanding goods and services and things like that."
He said the future in the downtown includes "some very active, vibrant streetscapes. We're going to have a lot of mixed-use, some architecturally stunning buildings, including The Bow. And I think we're starting to see a real better mix of uses in terms of residential, commercial, arts and culture, office space. I think we're seeing a far better integration of the downtown core with the Beltline . . . I just think it's going to be a far more vibrant and active place, only solidifying its presence as one of the strongest downtowns in North America."
Schofield said about 200,000 people work in the downtown area. The Calgary Downtown Association has about 3,700 members that range from the mom and pop shop, to EnCana. For retailers in the downtown, plenty of business is done during lunch hour with a captive market in the core.
"There's a lot of spending going on in Calgary and a lot of people that are doing that spending are people that work in the core," said Schofield. "And any given day, particularly when there's sunshine happening, you go outside the mall, or even inside, and it's teeming with people. So I would suggest that retail is going quite well."
Schofield said traffic overall throughout the city due to construction is a challenge for people.
"We refer to it as an inconvenient benefit because we believe that the infrastructure that will come out of that . . . the new arts facilities, the new restaurants, all those amenities that will come out of some of the construction and development that's going on will be fabulous for the city," said Schofield.
mtoneguzzi@theherald.canwest.com
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Thought this might be of interest to people out there. The amount of construction in Calgary is truly staggering for a metro of 1.1 million people. It should be noted as well that the community just south of the CBD (The Beltline) sort of the midtown of Calgary also has an addition 1.1 million sq ft of office construction as well. Calgary's current downtown inventory (excluding Beltline is about 32 million sq ft. It will be 40 million sq ft. in 4 years. Including Beltline there will be about 45 million sq ft.
There is also several thousand residential units U/C with many more thousands approved and proposed.
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