Calgary Co-op is investing $2.25 billion in the city with several innovative mixed-use redevelopment projects that will create 2.4 million square feet of retail, restaurant, office and residential space as well as revitalize underutilized areas in strategic urban locations.
Tony Argento, director of real estate and development for Calgary Co-op, said the total investment in the Calgary market includes about $1 billion in new centres and improvements to existing inventory and about $1.25 billion of mixed-use development.
It also involves the company looking to expand in other rural markets in the Calgary area as well as in more inner-city Calgary locations.
“We’ve got a very limited sandbox that we can play in. We have to maintain our market share. So if we don’t pick up those spots competitors will and we’re going to lose that market share to them. So our focus is to grow our business,” said Argento.
Key projects that will transform different neighbourhoods throughout the city include Mission Landing, Boulevard at Dalhousie, Oakridge Crossing, and Winston on Sixteenth.
Argento said many Co-op owned and controlled properties are under-utilized and the company realized a few years ago that there was plenty of potential for them in the future.
“And a lot of the sites are strategically located in mature communities where development has stopped for many, many years. So there’s nothing new that has been brought on the market. I saw a big opportunity for redevelopment,” he said.
“We’re differentiating ourselves from our competitors to remain viable. Technically if we were just competing on groceries probably Co-op would not exist for too long. A lot of our revenue now is coming from our real estate, from our tenants. We’re a fairly large landlord. By the time we start doing the majority of these re-developments the real estate department will be number one in terms of earnings for our members. It will exceed petroleum. It will exceed grocery.
“It’s important what we’re doing. We’re able to help the groceries to regulate itself to compete because of all the revenues we’re getting from the real estate portfolio.”
Residential developer Quarry Bay is working with Calgary Co-op on several of the innovative mixed-use redevelopments in established Calgary neighbourhoods.
“One of the advantages that we’ve got is that some of our centres are in mature communities. People are getting to the age of downsizing or rightsizing. They don’t want to leave the community. So by offering the residential components on our properties with all the amenities it’s an attraction for people,” said Argento. “There is that pent-up demand for these projects in those communities.”
The key developments, which will take up to six years to complete in some cases, include:
Boulevard at Dalhousie. Redevelopment will include 632,325 square feet. It will have 436 residential units in two buildings. There is also a 58,000-square-foot medical office planned. A new grocery store of 47,000 square feet will be added with a functioning greenhouse on the roof which will produce products for the store. A co-generation system will power the site. Also planned is a 5,200-square-foot liquor store, 39,500 square feet of retail space with a cannabis store and perhaps a small restaurant or coffee shop. Construction is expected to be completed in about six years;
Oakridge Crossing. The 438,772 square feet of new development will include a new 56,000-square-foot grocery store, 34,800 square feet of office space, 32,700 square feet of retail space and 249 residential units. Co-op is going to tender with some of the contractors to start the first phase of the project which is the professional building. The project could start in January or February 2020 with completion expected by around 2025;
Winston on Sixteenth (also known as North Hill). It was built in 1960, making it the company’s oldest store. The major redevelopment will include a new 44,000 square-foot grocery store, a new gas bar, a new car wash and potentially a new 4,800-square-foot Wine Spirits and Beer store. In addition it will add 8,200 square-foot of retail space and 12,500 square-foot of office space. There will be 115 residential units. It will take about five years to complete all phases of the project;
Mission Landing. The project is under construction with a new gas bar, car wash, and liquor store. There will also be 70 affordable apartment rental units in a five-storey building. There will be an underground parkade with about 60 stalls. The gas bar may be open spring or early summer of next year. The residential tower will open about a year after that.
“All the projects that we’re doing will have greenhouses, community gardens, co-generation. We may look at some for solar panels. So anything that we can do to reduce the carbon footprint. That will differentiate us from our competitors because none of them are doing that,” said Argento.
He said Co-op also has about six other new store locations it will be building over the next few years: Sage Hill Shopping Centre, Springbank Hill across from Aspen Landing, Silverado, Okotoks, the Eau Claire Market and Cochrane.
Argento said the company has finalized a purchase of property at Crossfield where a gas bar is planned and possibly a fast food retailer. The company is also actively looking for sites in Cochrane and Chestermere.
“We’re identifying spots there. Those are the only two rural markets that we don’t have a grocery store presence in,” he said.
Argento said Co-op has also started to partner with some local companies like Spolumbo’s and Cluck N Cleaver creating food kiosks for them in the company’s West Springs store in Calgary.
“We’re kind of looking at that model now looking to work with some small, local providers that we can create space for them and allow them to operate their businesses within our grocery store. It creates good traffic and synergies in helping the smaller businesses get a lot more exposure than they would on their own,” he said.
Six co-gen units are now operating for the company.
Co-op is also going to be building several new gas bars in the near future as well as several new liquor stores, and cannabis stores.
Editor’s note: Retail landlords across the country are intensifying under-utilized real estate by adding mixed uses. Learn more about the trend at Retail Council of Canada’s Brick-and-Mortar Forum, being held the morning of Tuesday, November 19th in Downtown Toronto.
