"Cows were grazing here three years ago," marvelled commercial agent Eugene Hritzuk of ICR Commercial Real Estate of Saskatoon as he watched Black Iron take shape. Hirtzuk said the developer, primarily involved in residential, was not interested in becoming a retail landlord and so opted to sell the land rather than build-to-suit.
"We thought they were being aggressive on the pricing," he said, admitting he was surprised that land sales were so strong.
"Getting Tim Hortons in gave us a lot of credibility. They are known for their due diligence."
At least one of the retailers has bought additional land at Black Iron, where it plans to build-lease for other retail clients, Hritzuk said.
Black Iron is not the only new retail centre taking shape. Sunset Ridge, also owned by North Prairie, currently hosts a Dairy Queen and a Second Cup, with a Little Caesars Pizza just starting construction.
Martensville Mayor Gordon Rutten said the city's rapid growth has led to the surge in retail: "It's very significant because many businesses use a benchmark of 7,500 [residents] in terms of franchise."
According to Rutten, the city has plans to grow to 10,000 people in short order.
John Williams, the founder of North Prairie who has been investing in Martensville for 15 years, said more retail announcements are coming.
"We've had interest from other national fast-food chains, a large hotel chain, a large-format food store and a big-box retailer," he said. "We are in negotiations with many."
The city has also zoned about 30 acres of land in north Martensville for industrial use, Shewchuk said.
Families first
As is often the case, retail and other commercial development is following a residential trend. There has been a movement from Saskatoon to Martensville in recent years by families seeking larger lots, a small-town atmosphere and less-expensive homes.
"We have a lot of families with two or more kids," Hritzuk said. "Martensville has become a bedroom community."
In fact, nearly a third of residents are under age 19 and 55 per cent are between 20 and 55.
North Prairie has developed the 40-acre McCormack Ranch residential subdivision and Sunset Ridge, a 73-acre residential community, to meet housing demand.
Homes in Martensville are no longer real cheap compared with Saskatoon. The average detached house price in Martensville is $313,000 according to Royal Lepage, while a similar two-storey house in Saskatoon sells for around $376,000. According to a Royal LePage survey, Martensville has a current average price of $261 per square foot for a detached house, considered high by small-city Saskatchewan standards.
The residential rental vacancy rate in Martensville mirrors Saskatoon in the 2.5 per cent to 3 per cent range, according to Shewchuk, who said most rentals are fourplexes, duplexes, condos or suites in private homes.
Last year, 125 detached houses and 28 multi-family housing starts were reported.
Incentives
In recognition that a growing population will need more shops and services, Martensville has an incentive-rich tax environment for those opening or expanding businesses. The city, for example, has a business incentive bylaw that allows up to a five-year property tax holiday on new construction if someone invests $1 million. As well, the Canadian Federation of Small Business said last year that Martensville had the "fairest municipal tax system" among Saskatchewan's small cities. Based on a $200,000 commercial property, taxes in Martensville are $2,642 - the lowest in the province.
from Western Investor March 2013
