Cheap rent is part of it, and indeed, not a great pull and furthermore not anything unique to Calgary. The unique thing about Calgary is the volume of space, which puts confidence in deep initial investments which have the potential to grow operations.
I'm not sure why you think I'm advocating for wholesale moving of operations, I am focused only on expansion, and how Calgary, through a combination of cheap rents and sheer volume of office space (along with being a major city, with a major university, and a young educated workforce) is an attractive candidate for big players to diversify their operations and especially American companies thinking about expanding office space into Canada.
The Scotiabank announcement was not just about moving, but about growing as well:
Quote:
“We conducted a full RFP to determine the best available space for our growing offices in Western Canada, and to ensure that we had access to the most up to date tools and technology to provide an excellent customer and employee experience in our new space. Brookfield Place met each one of our goals and we look forward to serving our customers from this premier location.”
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Start ups and all that are great as well, but realistically investments today will take decades to turn into enterprises with the financial clout whereby it makes sense to lease and move into full floor AAA office space downtown.
The bigger play with this office vacancy today is enticing large cap operation expansion with Calgary's advantages. Scotiabank is part of it, but if we can get 10-20 other deals like that to ensure some level of diversification, we would be looking at more like 15% office space vacancy. With a slight upturn in oil and gas, that could be sustainable in no time.
How long does it take to make that many deals? I'm not sure, maybe 5 years, given stable pricing. As such, I don't mind riding out this current wave of office space glut (not to mention lower commercial rates make companies like mine more profitable by default).
As much as I like pretty buildings and skyscrapers, I'm a Calgary resident first and skyscraper fan second, so if we lose some tall commercial buildings downtown as a sacrifice for 5 years of diversification, that's a great deal IMO.