Urban Development and Proposals Discussion

[CBBarnett]

Apparently One Properties has purchased the east half of Fram + Slokker's Verve site, with a rumour of a whack of units (600-800 if I recall correctly) in 2 towers, so each probably similar in size/height to Arris' taller tower. No application or renderings yet though. Also, I heard a rumour that Cidex had purchased the lot north of the NMC. And thirdly, there's a 4 tower project in the works on the block with the youth hostel on it, but not sure of the status of that one either.

Unfortunately EV is Ground Zero for the opioid/fentanyl and homelessness crises. I hear that is substantially affecting sale prices for condos there, which are anecdotally selling at prices well below similar units in Beltline and Eau Claire.

I would be curious to understand a bit more about the Calgary-specific dynamics of the urban condo market.

Prices have been flat for so long it's quite the opposite of many other narratives about the escalating housing cost crisis. Granted the market condo segment is fairly small in Calgary relative to the Vancouver and Toronto mainstream, but seems strange that there's been so little interest for so long, yet the inner city population continues to climb and boom.

Is it that the condo market is more nuanced and there's different stories for different product types (e.g. 1 v. 2 bedrooms)? Specific locations? Level of finishes? Seems like everywhere has mostly meh prices for nearly 15 years and only anecdotes to explain otherwise. I am sure niche location situations will apply here as anywhere but the whole of the market seems flat, not just units near interchanges or homeless camps.

Meanwhile it's not like we haven't been growing in population in the inner city, even before the current boom. Did we just build sufficient rental stock of the quality and type that is competing with market condos? Is the success in adding population in the surrounding areas via the robust ongoing infill projects like townhomes and infills taking some of the demand away that other cities would typically see concentrate into the towers?

Here's the price history of a large 1 bedroom in Bridgeland. Below the 2007 and 2014 peaks:

Here's a smaller unit in Garrison Woods directly in Marda Loop. Same boring story - essentially the same price since 2009:

These are just random anecdotes with long sales histories. But seems to be indicative of the only real trend in condo prices - flat.

 

[Albertasaurus]

I expected One Properties to prioritize the third Boulevard tower.

Yeah it is unfortunate that the zombie apocalypse has despoiled what should be one of Calgary's best public amenities.

I think you are probably right re: One Properties, probably easier to start the third Blvd tower with amenities already existing in the complex than to start a whole new development (that they don't have any approvals for as of yet). One also has that tower project on the TransAlta site which has a DP in already so I expect a few other projects to go ahead before their EV lands. Similarly I expect Cidex to proceed with its 3rd West Village Tower before building its big 3 tower Elbow River Hat.

 

[MichaelS]

Cidex owns so many properties downtown, maybe they are acquiring more, but just because they buy something doesn't mean it will turn into a project any time soon. Remember, they bought the site directly east of Vantage Pointe back in 2018. No project for that one:

Cidex buys high-density Calgary redevelopment site

Cidex Group of Companies, a real estate developer with several multi-residential projects in Calgary’s downtown area, has purchased a prime high-density development site in the Beltline neighbourhood previously owned by ATCO, RENX has learned. The 1.79-acre site was sold for

renx.ca

 

[badc0ffee]

These are just random anecdotes with long sales histories. But seems to be indicative of the only real trend in condo prices - flat.

I have an anecdote, but for detached houses.

I bought my last place (near Marda Loop) in 2012, and sold in 2021. The 2021 price was 5-6% higher than 2012.

I bought my current place (nearish Chinook mall) in 2021, and the land title record showed that the most recent sale before that was 2008. In that case, the 2021 price was 3% higher than 2008.

I'm not saying the whole city was like this, and things have probably changed at least a little since 2021. Neither place had major renovations during that time. The years I picked also do not cover the frenzied peaks of 2007 and 2013. But, that is pretty flat.

 

[outoftheice]

I thought CMLC had been hinting that Minto's site in the north east corner of East Village was supposed to launch in 2024? If that is still accurate, we should probably expect to see some sort of DP submission from them rather soon and it will likely be the next project to launch and complete the perimeter of East Village.

 

[gsunnyg]

Man! East Village has been such a letdown. The core, heart, of the community, is still a sea of parking lots. I wish CMLC would introduce some incentives to get the rest built out sooner before completely diverting their attention South of the train tracks, to Victoria Park. I know the homeless and addict populations haven't made it ideal to sell the area but I feel like if they can develop the pedestrian retail centre, AKA "The Riff," it could bring enough foot traffic in to counter illegal activities and shady hours. The Police Services could also plant one or two permanent patrol vehicles to allow residents to feel safe. What I fear is if nothing gets built now, in this high housing demand period, we'll have another 10 years of parking lots when a future slowdown in the economy occurs.

 

[trtcttc]

I’m wondering if developers are waiting for the arena plan and the 6th street underpass work. Most of the development seems to be condos vs purpose built rentals. As a developer, there’s fairly little carrying cost that it probably makes sense to wait a bit and sell units when you can advertise a 10-15 min walk to the brand new arena and associated amenities.

 

[trtcttc]

I would be curious to understand a bit more about the Calgary-specific dynamics of the urban condo market.

Prices have been flat for so long it's quite the opposite of many other narratives about the escalating housing cost crisis. Granted the market condo segment is fairly small in Calgary relative to the Vancouver and Toronto mainstream, but seems strange that there's been so little interest for so long, yet the inner city population continues to climb and boom.

Some anecdotal lessons from Vancouver. Condos were a money losing asset (taking into account inflation) that it was not popular to own. Rent control also made it a bad income asset. Then in the 2010s, SFH home prices shot through the roof, and condos started to be the only affordable option and took off.

Calgary is seeing some similar trends. With higher interest rates, condo prices increased the most last year compared to other housing types (as we probably all heard when assessments came out). One caveat is that Calgary can sprawl, so affordability can still be found, just further from the core. Maybe at some point people will say enough, it’s too far, but there’s no natural limit to sprawl like Vancouver and Toronto (Greenbelt).

I don’t think Calgary will ever see the explosive growth of Toronto/Vancouver, the city is doing a much better job rezoning and expanding. However, as the city gets bigger, and affordability doesn’t look like it’ll come back to Toronto/Vancouver, Calgary is really the most attractive metro for young people (jobs + affordability), immigrants (diverse population), and young families (good schools and amentities). I’m sure some people here think the “Alberta is calling” migration is another boom+bust cycle but the city and economy is much more diversified than those years.

 

[Albertasaurus]

Some anecdotal lessons from Vancouver. Condos were a money losing asset (taking into account inflation) that it was not popular to own. Rent control also made it a bad income asset. Then in the 2010s, SFH home prices shot through the roof, and condos started to be the only affordable option and took off.

Calgary is seeing some similar trends. With higher interest rates, condo prices increased the most last year compared to other housing types (as we probably all heard when assessments came out). One caveat is that Calgary can sprawl, so affordability can still be found, just further from the core. Maybe at some point people will say enough, it’s too far, but there’s no natural limit to sprawl like Vancouver and Toronto (Greenbelt).

I don’t think Calgary will ever see the explosive growth of Toronto/Vancouver, the city is doing a much better job rezoning and expanding. However, as the city gets bigger, and affordability doesn’t look like it’ll come back to Toronto/Vancouver, Calgary is really the most attractive metro for young people (jobs + affordability), immigrants (diverse population), and young families (good schools and amentities). I’m sure some people here think the “Alberta is calling” migration is another boom+bust cycle but the city and economy is much more diversified than those years.

Agreed The one thing I would mention is that, compared to Calgary, Edmonton is even more affordable by a significant margin (to the point where, sadly, my son has been contemplating moving there for that reason). Calgary is a bit bigger, considerably more diverse, has the main gateway airport, close to the mountains and milder weather, but otherwise Edmonton offers the same urban amenities, good jobs and services. Out of the million-plus metros, Edmonton really is a steal compared to any of the others.

With regard to the economics, Calgary seems to have reached a critical mass in the past few years where O&G is just one of many things going on. Even though oil prices have been robust there hasn't been a lot of employment growth in that sector anyways as far as I know. The growth in tech, distribution, renewables, film, and even aerospace have given us that diverse economy we've been seeking all these decades.

 

[CBBarnett]

Some anecdotal lessons from Vancouver. Condos were a money losing asset (taking into account inflation) that it was not popular to own. Rent control also made it a bad income asset. Then in the 2010s, SFH home prices shot through the roof, and condos started to be the only affordable option and took off.

Calgary is seeing some similar trends. With higher interest rates, condo prices increased the most last year compared to other housing types (as we probably all heard when assessments came out). One caveat is that Calgary can sprawl, so affordability can still be found, just further from the core. Maybe at some point people will say enough, it’s too far, but there’s no natural limit to sprawl like Vancouver and Toronto (Greenbelt).

I don’t think Calgary will ever see the explosive growth of Toronto/Vancouver, the city is doing a much better job rezoning and expanding. However, as the city gets bigger, and affordability doesn’t look like it’ll come back to Toronto/Vancouver, Calgary is really the most attractive metro for young people (jobs + affordability), immigrants (diverse population), and young families (good schools and amentities). I’m sure some people here think the “Alberta is calling” migration is another boom+bust cycle but the city and economy is much more diversified than those years.

Part of this is we are hitting the next scale of urban development at about 1.5M population for the region. 1.5M is a bit arbitrary, but is the next notable arbitrary point on our march to 2M in the coming decades. Growth will inevitably moderate from today's record pace, but all projections are for sustained growth for the coming decades.

While local factors apply, pure size of a city becomes a characteristic in itself. Sub-markets for different housing types and locations are just larger and more robust to booms-and-busts than they were when Calgary was at 750K or 1M people. Commutes are longer by car, and traffic congestion gets worse, incentivizing different location decisions of where to work and live. Niche districts start intensifying and areas start multiplying because the population can support multiple districts with the same or different amenities - University District, Marda Loop and others are examples already, but expect even more of this going forward.

Of Canada's larger cities, all had a development pattern change around 1.5M people:

• Vancouver -1.5M in 1985
• Toronto - 1.5M in the late 1950s
• Montreal - 1.5M in the early 1950s

Notably - all these cities continued to sprawl and have ample space to sprawl at the time they were at 1.5M (of course, all with a far denser core city to start with than Calgary hitting that threshold in 2023). This may play a factor in how Calgary's next era of growth plays out - commutes are relatively easy but distances are already far, won't take much more growth to create the nagging congestion and extended trip times that starts encouraging more people to live closer to where they actually want to be. The current sustained incremental infill boom is already a product of this dynamic and will likely continue, expand and strengthen as the market grows.

All in all - I can see many expected and unexpected growth clusters to start emerging around the city, just like in the other cities before us. Exciting times for sure.

 

[AtlanticAvenue]

I expect a lot of areas in the city to look very different 10 years from now, especially if the demand for housing stays as high as it is.

 

[Albertasaurus]

Our civic population surpassed 1.4m last year I believe. With Airdrie alone closing in on 100,000, Calgary's metro population is probably more in the 1.6-1.7m range now so hitting that 2 million will come sooner than a lot of people think.

 

[Dārayavauš]

Notably - all these cities continued to sprawl and have ample space to sprawl at the time they were at 1.5M (of course, all with a far denser core city to start with than Calgary hitting that threshold in 2023).

In the late 80s Downtown Vancouver and West End had about half the population of today so around 50k. That’s not a huge amount more than Calgary Downtown today (38k) and a similar size.

Granted we aren’t going to urbanize the downtown for living quite like Vancouver did as Calgary can sprawl. However more and more young people do want that downtown lifestyle so it’ll definitely increase rapidly by the time we hit 2.5 million.

 

[JoeUrban]

Was curious so went back and looked. Our favorite empty lot at 17th and 1st.
From '95, when the block was occupied.
View attachment 529198
To 2009, when it looks like the structures are vacant.
View attachment 529200
And finally, 2010 to today really, except now the funeral home is dead (pun intended).
View attachment 529201

Need a land value tax or some sort of hybrid. It's crazy that in the middle of a housing crises it's cheaper/easier to hold onto empty land than retain the housing.

 

[trtcttc]

Need a land value tax or some sort of hybrid. It's crazy that in the middle of a housing crises it's cheaper/easier to hold onto empty land than retain the housing.

That's being tried by Detroit in the US, decoupling land and structure in property taxes to encourage development. Our current assessment system basically let land speculators off the hook. Businesses think they pay too much property taxes and want to shift to residential, but land speculators are withholding residential stock increasing costs for everyone. The only issue I see with this is that older homeowners living in older homes would receive a massive increase in property taxes.

Could this obscure tax idea reshape American housing?

Detroit may put the land-value tax to the test

www.vox.com