Costco has opened its 7th location in the Edmonton region, and at 154,000 square feet it will also be the largest. While Costco members are undoubtedly happy to have another location to shop at, what we find particularly noteworthy about this new location is the vote of confidence for the Leduc / Nisku region.
For a major industrial hub with heavy exposure to the oil and gas sector, it’s no surprise that the region struggled during the provincial recession. When oil prices starting falling in 2014, we watched as pressures mounted on prices and activity in Nisku and Leduc’s commercial real estate market. The rush hour traffic jams in and out of the industrial parks were replaced by empty buildings and for lease signs. 2015 and 2016 were definitely tough years in that market.
However, we noticed a reversal of that trend about mid way through 2017. What caught our attention was the number of large commercial sales starting to regularly occur. In addition to a pickup in industrial activity, construction started on the Premium Outlet Collection Mall at the airport. While some were still skeptical of a recovery, others were forging on with new projects and capital investments. With oil prices coming off a depressing low and currently hovering around $70 / barrel, we’re optimistic the market will continue improving alongside it.
We suspect the improving economy was a big factor for Costco when it decided to add the new location. Also, there’s a large population in the area. Leduc County is just over 70,000, and there’s no doubt that the new Costco will also draw from areas in south Edmonton. If you happen to go to the new Costco, or even to the airport, send us a note and let us know how busy it is.
On a side note, with the addition of Costco and the premium outlet mall, coupled with a large scale commercial development to the north of it, we are speculating that this will accelerate the development of the annexed land from Leduc. It’s bewildering to consider how far south residential development already extends, with communities like Allard and Creekwood Chappelle butting up to 41 avenue SW. How long until we have residential neighbourhoods even further south?
Chad GriffithsPartner, SIOR, CCIM
Chad is a partner with NAI Commercial Real Estate and focuses on the Greater Edmonton area. Chad entered the industry in 2004 and has completed over 400 commercial transactions with clients ranging from small, local companies to large institutional owners. Chad has been a top 15 producer with NAI Canada-wide since 2013.
Ryan BrownPartner, BCom, SIOR
Ryan is a partner with NAI Commercial Real Estate in Edmonton and is currently ranked nationally as one of NAI's top advisors. Having executed in excess of $100 Million worth of sales transactions and over 2 Million square feet of lease transactions, Ryan has developed a firm understanding of asset evaluation and an aptitude for building design, functionality, and long-term practicality.
Darcie is a licensed Commercial Real Estate Agent in the Province of Alberta with a focus on the Edmonton market and its surrounding areas. Darcie accomplishes custom solutions for her clients through her personable nature and results driven attitude. Darcie can help if you are looking to invest in commercial real estate or are looking for representation for a sale or lease transactions.
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