INDUSTRIAL MARKET SURVEY RED DEER 2015 - … · TREVOR HANSON, AACI, P.App. INDUSTRIAL MARKET...
Transcript of INDUSTRIAL MARKET SURVEY RED DEER 2015 - … · TREVOR HANSON, AACI, P.App. INDUSTRIAL MARKET...
SODERQUIST APPRAISALS LTD | 405, 4901 - 48 Street
Red Deer, AB T4N 6M4
Ph.: 403 346 5533
Fax: 403 347 7730
soderquist.ca [email protected]
Prepared by:
MIKE GARCELON, AACI, P.App., MRICS, Q.Arb
TREVOR HANSON, AACI, P.App.
INDUSTRIAL MARKET SURVEY | RED DEER 2015
WE VALUE WHAT YOU VALUE COMMERCIAL • INDUSTRIAL • AGRICULTURAL • MULTI-FAMILY • RESIDENTIAL
Soderquist Appraisals Ltd. 2015 Red Deer Industrial Market Survey
INDUSTRIAL MARKET SURVEY | RED DEER 2015
About The Study
The industrial sector is a significant portion of the Red Deer economy and therefore the
economic dynamics and trends in the industrial sector are reflective of the overall state and
condition of Red Deer’s economy.
In developing this report we identified and studied sixteen industrial districts in and adjacent to
the City of Red Deer. We did not include any government owned industrial properties because
these are typically owner occupied and therefore do not compete in the open market.
The occupancy status of each industrial property was determined by visual drive-by inspections
conducted in September 2015, as well as additional data gathered from building owners,
tenants, brokers, and municipalities. Buildings currently under construction have been excluded,
but will be included in next year’s study.
About Us
Soderquist Appraisals Ltd. is a full service real estate appraisal and consulting firm providing
valuation and consulting services on virtually every real estate property type. Established in
1977 and located in Red Deer, Alberta we provide our services throughout central Alberta, as
well as all of western and northern Canada. For more information about Soderquist Appraisals
Ltd. please visit our web site at www.soderquist.ca.
Soderquist Appraisals Ltd. 2015 Red Deer Industrial Market Survey
INDUSTRIAL MARKET SURVEY | RED DEER 2015
Qualification
Readers of this report are welcome to use and reproduce the information contained herein,
either in whole or in part, provided that Soderquist Appraisals Ltd. is quoted as the reference
source.
This report is based on data obtained from sources believed to be reliable, however its accuracy
cannot be guaranteed. Soderquist Appraisals Ltd. makes no representations or warranties,
express or implied, in this regard. All information contained in this report is provided as of the
date of this report and is provided in good faith but without any legal responsibility of Soderquist
Appraisals Ltd. in any way. Nothing in this report constitutes investment or other advice.
Readers of this report are advised to conduct their own due diligence in this regard before
making any investment decision. Soderquist Appraisals Ltd. and its affiliates shall not be
responsible for any liability whatsoever for any loss arising from any use of this report or the
information contained herein.
Recognition
Soderquist Appraisals Ltd. acknowledges and is grateful for the assistance of Red Deer County,
the City of Red Deer, Century 21 Advantage Commercial Real Estate, and Salomons Commercial
in developing this study.
Soderquist Appraisals Ltd. 2015 Red Deer Industrial Market Survey
INDUSTRIAL MARKET SURVEY | RED DEER 2015
Red Deer Industrial Market
The Red Deer Industrial Market includes fifteen (15) distinct industrial districts, plus one
additional category for those stand-alone industrial properties outside of established industrial
neighborhoods.
The total inventory of industrial space increased by 327,326 sq.ft. (2.55%) during the 12 months ending September 2015.
The overall industrial vacancy rate is 7.51% as of September 2015 which is an increase of 387 basis points from 3.65% in 2014.
In September 2015 there was 988,557 sq. ft. of vacant industrial space, which is 111% more than 2014 when there was 468,678 sq. ft. of vacant industrial space.
Net Absorption for the 12 months ending September 2015 is -409,472 sq. ft.
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 11,778,672 12,157,947 12,544,269 12,840,692 13,168,018 327,326 ↑
Vacant (sq. ft.) 435,650 418,747 389,174 468,678 988,557 519,879 ↑
Vacancy Rate 3.70% 3.44% 3.10% 3.65% 7.51% 387bps ↑
*Net Absorption (sq. ft.) n/a 396,178 415,895 216,919 -192,553 -409,472 ↓
Trend (y/y)
*Net Absorption: Is the increase or decrease in the quantity of occupied space.
2011 2012 2013 2014
District Vacancy Rate Vacancy Rate Vacancy Rate Vacancy Rate Inventory (sq. ft. ) Vacant (sq. ft. ) Vacancy Rate
52nd Avenue 3.01% 1.97% 1.52% 2.73% 293,138 12,170 4.15%
Belich Industrial 1.39% 1.44% 1.44% 1.44% 433,138 82,544 19.06%
Blindman Industrial 3.76% 1.75% 0.00% 0.00% 544,866 15,358 2.82%
Burnt Lake Industrial 3.30% 4.54% 4.54% 4.04% 1,330,992 145,068 10.90%
Chiles Industrial 8.22% 12.94% 3.29% 3.29% 291,905 9,608 3.29%
Clearview Industrial 2.59% 1.16% 0.44% 5.27% 692,053 23,422 3.38%
Edgar Industrial 4.35% 1.70% 0.66% 1.37% 2,566,573 228,655 8.91%
Golden West/Johnstone 3.95% 3.53% 4.42% 6.23% 1,547,208 72,497 4.69%
McKenzie N/A N/A 19.86% 19.86% 325,502 61,670 18.95%
Northlands Industrial 5.50% 8.95% 4.79% 2.54% 1,476,199 97,615 6.61%
Petrolia Business 0.00% 3.23% 12.18% 7.75% 316,198 8,663 2.74%
Piper Creek Business n/a 46.84% 30.07% 53.71% 57,612 35,610 61.81%
Riverside Light Ind. 4.09% 4.35% 6.53% 2.63% 917,145 38,668 4.22%
Riverside Heavy Ind. 0.00% 0.14% 0.00% 0.00% 1,225,152 25,138 2.05%
Queens Business N/A N/A N/A 16.84% 385,075 37,717 9.79%
"Other" Industrial 5.02% 0.00% 0.00% 0.00% 765,264 94,154 12.30%
TOTAL 3.70% 3.44% 3.10% 3.64% 13,168,018 988,557 7.51%
2015
Soderquist Appraisals Ltd. 2015 Red Deer Industrial Market Survey
INDUSTRIAL MARKET SURVEY | RED DEER 2015
District Analysis
52nd Avenue Industrial District
The 52nd Avenue Industrial district is situated northwest of the Gaetz (50th) Avenue / 67th Street
intersection. It is bounded on the west by the Glendale residential neighborhood, on the south
by 67th Street, on the east by the Gaetz (50th) Avenue commercial strip, and on the north by the
Normandeau residential neighborhood. Some landmark developments include Quinn Pumps
and Automotive Universe.
Belich Business Park
The Belich Business Park is adjacent to the west boundary of the City of Red Deer, and is at the
south west corner of the Highway 2 / Highway 11 interchange. It is bounded on the west and
south by Red Deer County agricultural and country residential lands, on the east by Highway 2,
and on the north by Highway 11. Some landmark developments include Gentex Oilfield
Manufacturing and Line-X Coatings.
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 290,950 290,950 294,472 293,138 293,138 0 →
Vacant (sq. ft.) 8,770 5,738 4,490 8,006 12,170 4,164 ↑
Vacancy Rate 3.01% 1.97% 1.52% 2.73% 4.15% 142bps ↑
Trend (y/y)
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 433,138 433,138 433,138 433,138 433,138 0 →
Vacant (sq. ft.) 4,330 4,480 4,480 4,480 82,544 78,064 ↑
Vacancy Rate 1.00% 1.03% 1.03% 1.03% 19.06% 1762bps ↑
Trend (y/y)
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Blindman Industrial Park
The Blindman Industrial Park is in Red Deer County and is situated adjacent to the north
boundary of the City of Red Deer. It is bounded on the west by Highway 2A, on the south by the
Chiles Industrial Park, and on the east and north by Red Deer County agricultural and country
residential lands. Some landmark developments include Universal Handling Equipment and
Leyen Enterprises Corp.
Burnt Lake Business Park
The Burnt Lake Business Park straddles the City of Red Deer and Red Deer County boundary, and
is situated along the west side of Highway 2 near the north west corner of the City of Red Deer.
It is bounded on the west by Red Deer County agricultural and country residential lands, on the
south by Highway 11, on the east by Highway 2, and on the north by the Queens Business Park.
Some landmark developments include Strongco and UFA.
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 528,584 528,584 534,466 534,466 544,866 10,400 ↑
Vacant (sq. ft.) 19,874 9,230 0 0 15,358 15,358 ↑
Vacancy Rate 3.76% 1.75% 0.00% 0.00% 2.82% 282bps ↑
Trend (y/y)
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 1,144,343 1,257,913 1,257,913 1,295,992 1,330,992 35,000 ↑
Vacant (sq. ft.) 37,735 57,165 57,165 52,318 145,068 92,750 ↑
Vacancy Rate 3.30% 4.54% 4.54% 4.04% 10.90% 686bps ↑
Trend (y/y)
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Chiles Industrial Park
The Chiles Industrial Park is situated on the north side of the City of Red Deer. It is bounded on
the west by Highway 2A, on the south by the allowance for the future extension of Highway 11A,
on the east by the Red Deer River, and on the north by the Blindman Industrial Park. Some
landmark developments include Chiles Sandblasting and Stor-Mor Mini Warehousing.
Clearview Industrial Park
The Clearview Industrial Park is situated adjacent to the south boundary of the City of Red Deer.
It is bounded on the west by 40th Avenue, on the south by the McKenzie Industrial Park, on the
east by Red Deer County agricultural and country residential lands, and on the north by the City
of Red Deer Waste Management Facility. Some landmark developments include In-Land
Concrete and Peak Energy Services.
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 291,905 291,905 291,905 291,905 291,905 0 →
Vacant (sq. ft.) 23,994 37,760 9,608 9,608 9,608 0 →
Vacancy Rate 8.22% 12.94% 3.29% 3.29% 3.29% 0 →
Trend (y/y)
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 573,770 589,191 589,191 629,403 692,053 62,650 ↑
Vacant (sq. ft.) 14,850 6,847 2,577 33,171 23,422 -9,749 ↓
Vacancy Rate 2.59% 1.16% 0.44% 5.27% 3.38% -189bps ↓
Trend (y/y)
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INDUSTRIAL MARKET SURVEY | RED DEER 2015
Edgar Industrial Park
The Edgar Industrial Park is situated toward the north west corner of the City of Red Deer. It is
bounded on the west by Highway 2, on the south by 67th Street, on the east by Johnstone Drive,
and on the north by Highway 11A. Some landmark developments include Finning and Permolex.
Golden West / Johnstone Industrial Park
The Golden West / Johnstone Industrial Park is situated in the north west area of the City of Red
Deer and straddles 67th Street. It is bounded on the west by Johnstone Drive, on the south by
the Oriole Park residential neighborhood, on the east by the Glendale residential neighborhood,
and on the north by the Johnstone residential neighborhood. Some landmark developments
include Great West Kenworth Ltd., and Bruins Plumbing.
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 2,539,829 2,539,829 2,519,530 2,566,573 2,566,573 0 →
Vacant (sq. ft.) 110,526 43,243 17,580 35,289 228,655 193,366 ↑
Vacancy Rate 4.35% 1.70% 0.70% 1.37% 8.91% 753bps ↑
Trend (y/y)
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 1,480,011 1,547,208 1,547,208 1,547,208 1,547,208 0 →
Vacant (sq. ft.) 58,447 56,936 71,264 96,387 72,497 -23,890 ↓
Vacancy Rate 3.95% 3.68% 4.61% 6.23% 4.69% -154bps ↓
Trend (y/y)
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INDUSTRIAL MARKET SURVEY | RED DEER 2015
McKenzie Industrial Business Park
The McKenzie Industrial Business Park is situated in Red Deer County just south of the City of Red
Deer and east of Gasoline Alley. It is bounded on the west by 40th Avenue, on the south by
McKenzie Road, and on the north by Clearview Industrial Park. Some landmark developments
include Schlumberger and the Red Deer Shooting Club.
Northlands Industrial Park
The Northlands Industrial Park is situated towards the north side of the City of Red Deer. It is
bounded on the west by the Gaetz (50th) Avenue commercial strip, on the south by the Pines
residential neighborhood, on the east by Riverside Heavy industrial area, and on the north by the
allowance for the future Highway 11A extension. Some landmark developments include the
Home Hardware Building Centre and Habitat For Humanity.
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) n/a n/a 235,631 235,631 325,502 89,871 ↑
Vacant (sq. ft.) n/a n/a 46,800 46,800 61,670 14,870 ↑
Vacancy Rate n/a n/a 19.86% 19.86% 18.95% -92bps ↓
Trend (y/y)
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 1,450,346 1,476,199 1,476,199 1,476,199 1,476,199 0 →
Vacant (sq. ft.) 79,738 132,126 70,734 37,435 97,615 60,180 ↑
Vacancy Rate 5.50% 8.95% 4.79% 2.54% 6.61% 408bps ↑
Trend (y/y)
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INDUSTRIAL MARKET SURVEY | RED DEER 2015
Petrolia Business Park
The Petrolia Business Park is situated on the east side of the Gasoline Alley district, which is just
south of the City of Red Deer. It is bounded on the west by the Highway 2 commercial corridor,
on the south by Red Deer County agricultural and country residential lands, on the east by the
Piper Creek Business Park, and on the north by Spruce Street. Some landmark developments
include BWS Fabrication Inc., and Fortis Alberta Inc.
Piper Creek Business Park
The Piper Creek Business Park is situated on the east side of the Gasoline Alley district, which is
just south of the City of Red Deer. It is bounded on the west by the Petrolia Business Park and
the Highway 2 commercial corridor, on the east by Piper Creek, on the south by Red Deer County
agricultural and country residential lands, and on the north by Spruce Street.
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 246,396 246,396 283,872 283,872 316,198 32,326 ↑
Vacant (sq. ft.) 0 7,957 34,576 22,000 8,663 -13,337 ↓
Vacancy Rate 0.00% 3.23% 12.18% 7.75% 2.74% -501bps ↓
Trend (y/y)
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) n/a 33,390 33,390 57,612 57,612 0 →
Vacant (sq. ft.) n/a 5,600 10,040 30,942 35,610 4,668 ↑
Vacancy Rate n/a 16.77% 30.07% 53.71% 61.81% 810bps ↑
Trend (y/y)
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INDUSTRIAL MARKET SURVEY | RED DEER 2015
Queens Business Park
The Queens Business Park is situated toward the north west corner of the City of Red Deer. It is
bounded on the west by rural farm land and acreages, on the south by the Burnt Lake Industrial
Park, on the east by Highway 2, and on the north by Highway 11A.
NOTE: At the time of our survey there were eight buildings under construction in Queens Business Park
and therefore have been excluded from this survey.
Riverside Heavy Industrial Park
The Riverside Heavy Industrial Park is situated toward the north west corner of the City of Red
Deer. It is bounded on the west by the Northlands Industrial Park, on the south by municipal
environmental reserves, on the east by the Red Deer River, and on the north by the allowance
for the future Highway 11A extension. Some landmark developments include Olymel and Quinn
Pumps.
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) N/A N/A N/A 385,075 385,075 0 →
Vacant (sq. ft.) N/A N/A N/A 68,150 37,717 -30,433 ↓
Vacancy Rate N/A N/A N/A 17.70% 9.79% -791bps ↓
Trend (y/y)
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 1,203,664 1,208,149 1,208,149 1,225,152 1,225,152 0 →
Vacant (sq. ft.) 0 1,696 0 0 25,138 25,138 ↑
Vacancy Rate 0.00% 0.14% 0.00% 0.00% 2.05% 205bps ↑
Trend (y/y)
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Riverside Light Industrial Park
The Riverside Light Industrial Park is centrally located within the City of Red Deer. It is bounded
on the west and north by municipal environmental reserves, and on the south and east by the
Red Deer River. Some landmark developments include Waste Management of Canada and Red
Deer Co-op Home and Garden Centre.
“Other” Industrial Areas
This category includes those industrial developments and industrial zoned land which are outside
of the established industrial neighborhoods. Some examples include Crimtech Services Ltd. in
Gasoline Alley, and Key Agventures Inc. near the intersection of Highway 11 and Highway 2.
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 917,145 917,145 917,145 917,145 917,145 0 →
Vacant (sq. ft.) 37,496 39,929 59,860 24,092 38,668 14,576 ↑
Vacancy Rate 4.09% 4.35% 6.53% 2.63% 4.22% 177bps ↑
Trend (y/y)
2011 2012 2013 2014 2015
Total Inventory (sq. ft.) 739,481 739,481 731,650 731,650 765,264 33,614 ↑
Vacant (sq. ft.) 40,190 0 0 0 94,154 94,154 ↑
Vacancy Rate 5.43% 0.00% 0.00% 0.00% 12.30% 1230bps ↑
Trend (y/y)
Soderquist Appraisals Ltd. 2015 Red Deer Industrial Market Survey
INDUSTRIAL MARKET SURVEY | RED DEER 2015
52nd Avenue2%
Belich3%
Blindman4%
Burnt Lake10%
Chiles2%
Clearview5%
Edgar19%
Golden West / Johnstone
12%
McKenzie2%
Northlands11%
Petrolia2%
Piper Creek
0%
Riverside Light7%
Riverside Heavy9%
Queens3%
Other areas6%
Neighborhood Comparitive Size Based on Total Building Areas
Soderquist Appraisals Ltd. 2015 Red Deer Industrial Market Survey
INDUSTRIAL MARKET SURVEY | RED DEER 2015