2014 is shaping up to be a promising year for Alberta real estate for the following reasons:
Massive Alberta Surplus
The new budget features a $2.6 billion operating surplus, while managing to keep pace with the blossoming school growth. The province even outdid what used to be the center of the financial universe €“ New York. No new taxes and a multi-billion dollar surplus will not only help existing Alberta businesses expand, but will also gain the confidence of the rest of the world as it pertains to investing in Alberta.
Workspace and the U.S. Invasion
New commercial real estate forecasts for 2014 to 2017 continue to place Edmonton as a leader in the Canadian economy. "Cautioned optimism" may still be the buzz phrase of the day for the Calgary office market while it attempts to balance supply with demand, but it's pedal to the metal for the Edmonton market. One of the world's largest commercial real estate analytics firms recently predicted that U.S. economic and Canadian dollar trends would push growth and industrial activity in Alberta markets, including Edmonton. Office is certainly a fast changing sector, which can be summed up perfectly by the name of a U.S. flexible workspace provider intent on invading the province €“ LiquidSpace. The U.S. was recently credited with dominating the world's flexible co-working space with 781 such office locations in 2013. Now players like Regus have been cashing in on the trend in Canada with about 200,000 Canadian businesses using this type of space. At least 10% of those are in Calgary alone. A recent Regus survey shows 79% of workers say they would choose one job over another if it offered flexible working. However, many of the new enterprises and startups being hatched and incubated in these Edmonton and Alberta spaces are now growing up and are attracting major funding. Those with physical products are going to need storefronts and retail space to sell their wares.
Build it and They Will Come
With vacancies in Alberta pretty close to zero there is a lot of development in the works. Statistics Canada reports that January 2014 building permits were up 49.2% year over year for the province. On the residential side Edmonton's permit value outpaced Calgary at $83 million for the month. Commercial investment in the city is also exploding. Construction on the downtown arena officially began March 3rd 2014. These recent trends are indicators that 2014 may be a promising year for commercial real estate in Alberta.