Vancouver developer PC Urban Properties Corp. has bought a fully leased industrial park in south-central Calgary, where it plans to convert the 111,000-square-foot property to industrial strata.
Core Business Park will be one of the few commercial condo conversions in the Alberta city.
“There’s a very limited supply of inner-city resale [industrial] condos in Calgary,” said Sean Ferguson, associate vice-president, industrial, for Cushman & Wakefield, the listing agents for the property. “Most is either newly developed and sold as a shell, without an office or on the periphery of the city.”
He said the 13 tenants at the 24-bay building will leave, either through early termination or by purchasing their unit. Ferguson added that a separate investor could also buy a unit and keep the tenant in place.
“We will work to find an amicable solution,” he said.
Tenants can choose to stay as the developer upgrades the two old buildings on the 5.6-acre site, which is close to major highways and downtown Calgary.
The buildings date to the 1970s and have 18-foot ceilings, considered low by modern standards.
“It’s the location that is really the key,” Ferguson said.
He added that the local industrial vacancy rate is around 5 per cent, and lease rates are in the $10 per square foot range.
PC Urban is well known in Metro Vancouver, where it has successfully converted a number of old industrial sites into modern strata buildings.
But Ferguson said it is unlikely that the Core Business Park will see the $800 to $900 per square foot prices being achieved in Vancouver and will more likely be in the $230 to $245 per square foot range.
“This is a rare opportunity for businesses to invest in their own commercial property in Calgary,” said Brent Sawchyn, principal at PC Urban. “As we’ve seen in our other commercial condo projects in Vancouver and Kelowna, it’s a move many businesses are ready to take.”
Renovations at Core Business Park will start this summer with completion scheduled for 2019’s first quarter.