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  #1  
Old Posted Feb 15, 2012, 12:37 AM
miketoronto miketoronto is offline
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What is Calgary's Secret in the fight against decentralization

Calgary is perhaps the only young North American city where the downtown has and continues to attract a large amount of new office construction.

In fact while almost all other North American cities are sitting and watching as new office projects only open in the suburbs, Calgary has seen mega projects open over the past few years.

What is the secret behind Calgary's success with building a strong office core downtown? Surely the companies opening downtown could build in the suburbs if they want. What has Calgary done to make the downtown a continued attractive place to put up mega towers, when almost every other North American city is struggling to even get a small tower built?
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  #2  
Old Posted Feb 15, 2012, 12:47 AM
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By the fact that the central municipality is home to 91% of the metro population. They can therefore plan the city how they like and businesses will have to follow suit unless they want to be on the fringes of the urban area. And with a booming economy, there are simply a whole lot of businesses opening up and expanding.
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  #3  
Old Posted Feb 15, 2012, 1:00 AM
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Not sure about that. Detroit has just about the same amount of people in the city as Calgary and you see how that is playing out.
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  #4  
Old Posted Feb 15, 2012, 1:23 AM
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Not sure about that. Detroit has just about the same amount of people in the city as Calgary and you see how that is playing out.
Uh, Detroit has about 16% of its metro population living in the city.

It also has (or had) a manufacturing-heavy economy in a country that has been hit hard by the recession.
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Old Posted Feb 15, 2012, 1:26 AM
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First, what types of companies are driving the growth in demand for space? Are they companies that benefit from agglomeration and proximity to services and government offices?

Second, having never been there I can only go by Google Maps, but I don't get the sense that Calgary's outskirts are particularly highly accessible. Most high capacity transport is oriented N-S converging on downtown, with the only crosstown artery far to the north. It could be as simple as Calgary's downtown being far and away the most accessible and viable place for office employment in the region irrespective of all other considerations.

Last edited by VivaLFuego; Feb 15, 2012 at 1:39 AM.
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  #6  
Old Posted Feb 15, 2012, 1:36 AM
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Quote:
Originally Posted by MonkeyRonin View Post
By the fact that the central municipality is home to 91% of the metro population.
No. That's not what he means. Calgary is a unicity but it comprises a large land area and the office development COULD have been in "suburban" areas within the city limits. It's not.

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  #7  
Old Posted Feb 15, 2012, 2:18 AM
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Originally Posted by Rusty van Reddick View Post
No. That's not what he means. Calgary is a unicity but it comprises a large land area and the office development COULD have been in "suburban" areas within the city limits. It's not.

Mike, we're just awesome.
Yeah but you don't have suburban governments trying to bring businesses to the outskirts to add to their tax base. The government in charge of the "suburban" areas is the City of Calgary, and I guess they want their employment downtown.

It does seem like other Canadian cities with municipalities that include most of the urban area, such as Edmonton, Ottawa, Winnipeg, Hamilton and Quebec City are fairly centralized, although their economies aren't booming as much so I guess their downtowns aren't quite as big.
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Old Posted Feb 15, 2012, 2:32 AM
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Calgary doesn't have nearby competitors. There is no nearby Surrey or Brampton selling cheap land to get an edge over it. There really wasn't any reason for Calgary to ever develop suburban business parks; it would just devalue their downtown, and the booming economy ruled out doing so due to necessity, like poorer cities like Thunder Bay did. Calgary does have many industrial parks, but those are different. They're full of businesses that, due to their nature, cannot be easily located downtown, nor would residents and workers downtown want them there.

Also, Calgary itself got so big so fast compared to other communities around it that none of them got a chance to rival it. Toronto had many competitors on its borders, each one wanting a piece of the development pie, most of them growing rapidly since the 1960s and taking up pieces of Toronto's built area. Calgary was surrounded by communities that basically seemed to accept their fate as rural communities, and its urban sprawl has yet to spill over into other municipalities. Even if they made the case for suburban business parks, they would never be able to compete with downtown Calgary at this point.

I'd say it's a combination of circumstance and foresight. They didn't need to build suburban business parks, and saw no practical reason to ever do so.
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Old Posted Feb 15, 2012, 3:20 AM
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Quote:
Originally Posted by Rusty van Reddick View Post
No. That's not what he means. Calgary is a unicity but it comprises a large land area and the office development COULD have been in "suburban" areas within the city limits. It's not.

The above two posts just about covered what I was getting at...but basically, the more power and less competition a single level of government has within a metro area, the easier it can plan the city how it wants - in this case, with a strong centre.
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  #10  
Old Posted Feb 15, 2012, 3:24 AM
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I never got why people hated decentralization so much. For example, both London and Tokyo are crazy decentralized, and they are both crazy urban, dense, cities. Would they be any better if they were centralized?
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  #11  
Old Posted Feb 15, 2012, 3:41 AM
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You need critical mass to create vibrant urban areas. In a city the size of Calgary, only one center makes sense. London and Tokyo have multiple centers, but each one is the size of a Calgary on its own.
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  #12  
Old Posted Feb 15, 2012, 4:23 AM
miketoronto miketoronto is offline
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Bot many cities have uni city governments, and still can't get downtown employment growth. Many have much larger boundaries than Calgary does.

As for London and Tokyo. London happens to be one of the most centralized cities you can find. It is one of the only cities which is planning a large majority of future economic growth to be within the city centre.
In fact even Wendle Cox who hates cities, states that London is one of the only cities to continue downtown economic growth and stop large decentralization.
Anyway thats for another thread.
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  #13  
Old Posted Feb 15, 2012, 4:36 AM
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Quite a few cities are adding offices in their downtowns, or at least near them. Mine certainly is, even if Downtown doesn't have Calgary's market share.

Generally, land values in a growing but slow-sprawling city will be high enough that surface parking is difficult. Once even the suburban office buildings need to structure their parking, or go below-grade, going highrise might not be much of a cost jump.

Also, certain industries tend to align better with highrises than others. Oil companies apparently. Other firms tend to prefer larger floor plates and/or smaller buildings, possibly in more unique/cool formats.

Two reasons among presumably many. I agree with the point about not having other municipalities angling for office districts, though I don't know Calgary.
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Old Posted Feb 15, 2012, 4:01 PM
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Sydney has a number of satellite downtowns that are quite successful spanning more than a 50 mile radius but that hasn't been a hinderance to the main downtown.
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Old Posted Feb 15, 2012, 4:01 PM
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Probably the lack of a manufacturing base means that there is less demand for industrial jobs that cannot be located downtown. As a result, it allowed more employers to centralize and avoid spreading into the suburbs.
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  #16  
Old Posted Feb 15, 2012, 4:30 PM
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Quote:
Originally Posted by miketoronto View Post
when almost every other North American city is struggling to even get a small tower built
is that even true? speaking for chicago (the city i know best), there have been 10 major office towers* built downtown within the last 10 years. and the suburbs of chicago have not seen a recent boom in office construction. the suburban office market in chicagoland is dismal at the moment (26% vacancy rate, with no new inventory currently under construction).



(*) "major office tower" defined as 400' or taller
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Old Posted Feb 15, 2012, 5:05 PM
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Originally Posted by Illithid Dude View Post
I never got why people hated decentralization so much. For example, both London and Tokyo are crazy decentralized, and they are both crazy urban, dense, cities. Would they be any better if they were centralized?
Neither Tokyo nor London is remotely decentralized in the U.S. context.

They both are very highly centered on a given geography, with the largest bulk of commerce, and the highest land values, within that geography.
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  #18  
Old Posted Feb 15, 2012, 5:17 PM
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Originally Posted by miketoronto View Post
Bot many cities have uni city governments, and still can't get downtown employment growth. Many have much larger boundaries than Calgary does.
Such as? The only ones I can think of in North America that are in the same population range as Calgary where most of the metropolitan area is concentrated in a single municipality are Edmonton, Winnipeg, and Quebec City.

And the first two are seeing quite a lot of new office space being built downtown relative to the suburbs. They're just not seeing quite the same level of development because the sectors of their economies that would make use of office space isn't as robust as Calgary's.

In Quebec City on the other hand, its not concentrated "downtown" because their downtown is the historical centre. Most new development does seeo to be concentrated in a few focal points within the municipality though.
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  #19  
Old Posted Feb 15, 2012, 5:41 PM
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There are plenty of "suburban" office parks in Calgary and the adjacent City of Airdrie is booming on Calgary's leftovers since it is cheaper to locate and live there.
The reason Calgary's downtown is a success is because of the oil and gas industry and its need to be close by to competitors, suppliers, banks, and government regulators (Energy Resources Conservation Board, National Energy Board).
Calgary is also becoming the dominant retail distribution hub of the prairie provinces which means millions of square feet of space being developed mainly on the fringes of the NE of the City near the airport, main highways and rail.
The massive Target distribution centre is under construction right now in Balzac in the Municipal District of Rockyview between Airdrie and Calgary.
There will probably be half a dozen office towers starting construction this year downtown as the AAA class office space vacancy is close to zero.
- Eighth Avenue Place west tower has announced construction will commence this spring
- Centre 10 - 7 floors of underground parking are done already so the office building won't take long to build.
- City Centre - an entire block with a hotel/residential tower and an office tower by Cadillac Fairview
- Bow south block
- Centennial Place 3 (Eau Claire tower) by Oxford
As well, Brookfield is planning demolition on the site of Herald Square which could be one of the biggest office towers built downtown.
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  #20  
Old Posted Feb 15, 2012, 5:42 PM
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Calgary is a unique market. I've actually worked on a few big office deals and have a few going on right now. The main driver of the compact nature of this city simply comes from the fact that it is a boom town. Its economy is chugging along faster than the metro can sprawl outwards right now. This doesn't really leave a lot of choice in the matter of where one can choose to locate their office.

Also, I think Calgary is, to a certain extent, just from a different age. Calgary wasn't big enough to suffer from the rape and pillage of its downtown when that was in style in the 60's and 70's and, as a young boom town, is a product of a new age where we've learned that surrounding your downtown in parking lots is a very bad idea. Instead Calgary has surrounded its downtown in a series of wonderful parks along the river and compact residential neighborhoods.

Quote:
Originally Posted by VivaLFuego View Post
First, what types of companies are driving the growth in demand for space? Are they companies that benefit from agglomeration and proximity to services and government offices?
Calgary is powered by energy and raw materials companies and whole slough of sister industries that tend to accompany them. Engineering is absolutely huge out there right now as Calgary is basically the new frontier in North America as the Canadian north is increasingly exploited for tar sands and other natural resources. Every major engineering company is fighting for space there right now and vacancy rates are sub 10% downtown and at like 12% in the "suburbs".

It's ironic that you ask if they are companies that thrive on agglomeration because the engineering industry is notoriously fickle about what neighbors they are willing to share a building with. Because their work is so IP sensitive they want to be as far away from their competitors as possible while still being in the same metro so they can have access to the same labor pool. This is part of why Quarry Park and other Suburban office parks are booming right now; all the engineering firms are attempting to spread out and get away from each other.

Quote:
Second, having never been there I can only go by Google Maps, but I don't get the sense that Calgary's outskirts are particularly highly accessible. Most high capacity transport is oriented N-S converging on downtown, with the only crosstown artery far to the north. It could be as simple as Calgary's downtown being far and away the most accessible and viable place for office employment in the region irrespective of all other considerations.
I am currently trying to sublet out about 20,000 SF of raw space in Quarry Park which counts as a "suburban market" in Calgary. Suburban in Calgary means "5 miles from downtown". I think this has a lot to do with the fact that Calgary has a very underdeveloped freeway system compared to most sprawling metropolises and therefore just goes from city on one side of the street to farmland on another. The entire developed area is pretty much 6 miles wide by 12 miles long which is absolutely minuscule compared to most areas.
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