Fast flow
Marsden understands the Highway 2 city's lure to larger industrial clients. Those clients have immediate access to Alberta's north-south highway backbone, not to mention the Trans-Canada Highway bypass around the north end of Calgary. The latter means there are now virtually no traffic snarls or delays to ship east or west from Airdrie. In contrast, inner-city Calgary-based warehouses close to the Deerfoot Trail freeway are sometimes accessed only through snow-day gridlock.
Then there are the numbers that matter considerably to many large building leaseholders: lease rates and tax rates.
Airdrie, says Marsden, does comparatively well in both categories when lined up against the metropolis to the immediate south.
Low taxes
"Your property taxes are significantly lower, anywhere from 13 to 17 per cent," Marsden explained. On top of that, Airdrie doesn't have a business tax. Calgary is still contemplating how to get rid of its business levy.
Taxes played a role in the decision of TransCanada Turbines to relocate a production facility to Airdrie, Marsden notes. The company opened a new shop with 180,000 square feet of production space along Highway 2 in summer 2011.
Airdrie's ongoing growth has also produced a huge new labour pool in the city for potential employers, and while Airdrie residents have shown a willingness to drive to Calgary for work, the potential is there for large, new employers to reduce commuter numbers over time.
As things now stand, only about one-third of employed Airdrie residents actually work in their home community, according to city census figures.
"There's been significant growth in the population over the last three to five years. What that's doing is creating a critical mass of people for the workforce to draw from," Marsden noted.
Industrial
Marsden is involved in marketing the city's new Highland Park industrial subdivision on behalf of Beddie Group, and says that factors such as lower land costs also help to make Airdire projects such as Highland Park attractive. Airdrie industrial land typically sells for 70 to 75 per cent of the cost of Calgary land ($425,000 to $475,000 in Airdrie, as compared with up to $700,000 in Calgary) making it possible for companies such as Beedie to offer shell lease rates as low as $5.95 per square foot on new warehouse space.
Kent Rupert, the City of Airdrie's economic development team leader, noted Airdrie's attractiveness while summarizing the city's 2011 numbers in mid-February.
"It was another great year for Airdrie business," Rupert said. "From the expansion of existing businesses to new strip malls to construction of a large-scale industrial building [a $9 million building in Highland Park], the market reflected there is still a lot of confidence in the Airdrie market."
Indeed. The city recorded an average of 27 new businesses licensed each month in 2011 and, according to the city's satisfaction survey, 89 per cent of businesses believe Airdrie is a good place to do business.
Housing hot
It's also a popular place to move to, according to city stats. New-housing building permits hit 1,070 units in 2011, including 629 single-family homes, 182 duplex units and 259 multi-family units.
The past year marked a recovery in permits for multi-family units, which fell to zero for 2008, 2009 and 2010 after accounting for 1,543 units in the three previous years, roughly 34 per cent of the market in 2005-07.
Multi-family units account for 24 per cent of new housing in the city in the past nine years, suggesting Airdrie is far more than just single-family suburbia.
Area structure plans approved since 2005 allow for more than 16,600 housing units, with multi-family construction accounting for roughly 44 per cent of those.
While new homes keep coming, MLS housing stats show housing prices are still down from four years ago. The average selling price for a single-family home in the city hit a peak of 379,581 in 2008 and had fallen to $360,836 for 2011. The average condo sold for $210,303 last year, down from a high of almost $260,000 in 2007.
The city's tax regime may make rentals a good investment, particularly with more larger employers such as Costco set up in or coming to Airdrie. The retail giant was one of the first major companies to set up a state-of-the-art warehouse in industrial Airdrie, taking the plunge back in 2007.
While Airdrie pretty much sells itself due to location and logistics advantages, its chamber of commerce isn't afraid to detail the advantages of southern Alberta's fast-growing city.
Notes Lorna Hunt, the executive director of Airdrie's chamber, Airdrie has no business tax, straddles Alberta's busiest highway and is a closer commute to Calgary International Airport than most of Calgary.
Those factors help businesses stay in the city, even when expanding.
"Businesses will expand, or relocate, but they stay in Airdrie," explained Hunt. "That's what I find exciting. If there's something wrong with where they are, they will look within Airdrie and find something better."
As a longtime resident, Hunt has seen service levels to residents and businesses grow. There's better access to everything from medical services to a wide range of shopping and excellent schools.
Land values
The amenities of the growing city and the community feel of the place make it competitive even as land values have gone up.
Veteran Century 21 commercial realtor Ed Eggerer says the community itself is a selling point, one that helps Airdrie compete against the growing retail and industrial cluster of development at Balzac, between Calgary and Airdrie.
"We have a quality of life inside the city here that's very well established, and people realize that when they come looking to either locate their company or their plant here," said Eggerer.
Commercial retail space in the Airdrie market varies in cost, from under $20 a square foot annually to the high 20s or over $30 in the newest power centre development.
Eggerer says vacant industrial space in the city can be found for $8 to $9 per square foot, at least for larger shops. There isn't too much spec building going on right now, Eggerer says, with new construction being pushed more by owner-users in need of more space.
While industrial land costs may not be considerably less than around Balzac any more, the look and feel of Airdrie still make it attractive, he says. They also like the growth, says Richard Glubish, director of leasing for Hopewell Development, which is developing the 43-acre Sierra Springs retail project on the south end of Airdrie along Highway 2.
from Western Investor April 2012
