"It was partially to satisfy local demand here, but also part of the strategy to retain people here in the city and attract people to the city."
The latest building and development data suggest it might be doing that.
While Canada Mortgage and Housing Corp. (CMHC) stats say housing starts were down somewhat in GP for the first three months of the year, from 60 to 45, other numbers paint a positive picture of growth.
The city issued building permits for over $53 million in new construction for the first quarter of 2012, more than doubling the $24.7 million total from the first quarter of 2011.
Power centre
More significantly, perhaps, the 2012 figure doesn't include the application for 250,000 square feet of new retail development in a project known as Westgate Centre.
The new retail complex on the city's west side at the 116th Street Ring Road bypass and Highway 43 will be built in two phases, the first one offering 144,000 square feet of big-box space to satisfy growing consumer demand in the city and from places further north and west in northeast B.C. and northern Alberta.
WAM Development Group hopes to bring the first phase of the project on line in spring 2013, with the second phase to come in 2014.
Grande Prairie is an attractive place for retailers for several reasons, including high annual household incomes - average of $121,000 - and a secondary trading area that includes over 140,000 people, many of them living in under-served resource communities.
Projected tenants for the Westgate development include not only large-format retailers, but fashion retailers, restaurants and smaller shops.
At current development costs the new complex on close to 30 acres will ring in at around $140 million.
It is a sign of confidence in the future of the city, and of the oil and gas industry that supports it.
Grande Prairie skidded somewhat when the oilpatch tanked in 2008 and the global financial markets went into a tailspin. Natural gas prices sagged and industrial building lots sat empty in the northern resource city.
But things have been picking up significantly in the past couple of years with escalating oil prices and the greater emergence of natural gas liquids (linked to oil prices) in the market.
The latter has meant more demand for industrial property in the city, and outside the city in the surrounding County of Grande Prairie.
The surrounding county is a hub for oilpatch, agriculture and forestry businesses, all of which seem to be doing well, or well enough nowadays to generate growth.
In the words of Walter Paszhowski, a former area MLA who still handles the economic development duties for the county: "Things are going quite well."
"It looks like a good year," Paszkowski said of 2012 prospects. "It's going to build on the regrowth of 2011, and it certainly appears that 2012 will improve on 2011 by a fairly significant amount."
Affordable homes
The county's building-permit values totalled roughly $885 million from 2007 to 2011, with the peak coming in 2007, when permit values hit $312.7 million.
They fell to $100.4 million in 2010, but bounced back in 2011 to $151.6, and Paszkowski expects that number to climb again this year thanks to a general increase in activity.
"What we've got here is a pretty good balance of agriculture, energy, forestry and, to a growing degree, tourism. We have close to 3,000 hospitality suites in this community. Those four are the drivers," he said, explaining how Grande Prairie's reach is expanding.
"It's generally growing in all directions as the quality of service delivery improves and grows overall."
Unlike Fort McMurray, Grande Prairie isn't known for overpriced housing beyond the reach of many in its workforce.
The average price for homes sold in mid-2011 was in the $260,000 range, according to the Grande Prairie & Area Association of Realtors, though that number has also climbed.
Even new homes finished in the past quarter rang in for an average of only $330,858, according to CMHC data.
Things are picking up in the real estate market though, according to Paszkowski.
"I was just talking to some realtors, and they were saying that homes that used to be on the market for a month or two are now going in a week or two," he explained.
The rental market is also definitely tightening up, giving landlords the potential to earn positive cash flows.
Vacancies tighten
CMHC's fall rental market survey for 2011 pegged Grande Prairie's apartment vacancy rate at 3.9 per cent in October 2011, down from 10.5 per cent only 12 months earlier. Average apartment rents climbed from $798 to $845 in the same period.
Glavin says internal city data now suggest the vacancy rate has moved closer to zero, and that will inevitably push up rents. A quick scan through various websites with local rentals produces a range of properties, including houses commanding $1,600 to $1,800 per month for families looking for big yards and lots of room for outdoor toys.
It's expected the ramping up for construction of the new regional hospital in Grande Prairie will also put more demand on the stressed rental market.
Tightening vacancy rates and growing building totals tell part of the story for the area. Another is reflected in the profusion of "help wanted" signs these days.
"You virtually can't go by a major employer without seeing a sign for hire. There are very few that don't have those signs up," noted Paszkowski.
That, he says, is another solid indicator that Alberta's northwest hub has plenty of growth potential ahead.
from Western Investor June 2012
