Oilpatch pumps up market

Glenn Moore is doing something you might not have expected of a commercial real estate agent in recent years: working long hours.

Glenn Moore is doing something you might not have expected of a commercial real estate agent in recent years: working long hours.

“We had our busiest month in the last 10 months in August,” said the Realtor with Century 21 Advantage Commercial of Red Deer.

Moore described several sizable deals that he’s working on, and pointed to a rejuvenated oilpatch as the main reason.

“If you look at the number of ads and the people who are gearing up and hiring, and you ask a few of the big players in the oil business, things are coming around.”

Davin Kemshead, also with Century 21 Advantage Commercial, sees further reason for optimism in the number of hits his online listings are getting.

“In September, we are already over our hits — on a monthly basis — for the last five months.”

Web traffic usually evolves into phone calls, which in turn can translate into deals.

Daniel Goldstrom, an agent with NAI Commercial in Calgary, said his office is now averaging a couple inquiries every week about land in Clearview Industrial Park south of Red Deer.

“We actually have two offers for land purchases there, right as we speak,” he said, adding that one is for a nine-acre lot, on which the prospective buyer — a local oilfield service company — wants to build a 38,000-square-foot building.

“That’s paper that wasn’t available earlier in the year.”

Ralph Salomons of Ralph Salomons Commercial Inc. in Red Deer said the past 12 months have actually been pretty good for his company.

“It was a good market, and the market is actually getting stronger all the time.”

Things usually pick up in the fall, he acknowledged, but this year is better than the last.

“There’s a real sense of optimism out there,” said Salomons, agreeing that the oilpatch has been the impetus.

“The multinationals are the ones that are doing a lot of the purchasing and leasing.”

Compared to the local land rush of several years ago, buyers now have greater choice, better prices, more predictable construction costs and lower interest rates, he said. The only real impediment is continued tight financing.

Moore and Kemshead agreed that it seems to be a seller’s market, with more interest in buying opportunities than actually exist.

Big industrial properties are probably in the greatest demand.

“Anything 10,000 square feet and up, we’re seeing activity,” confirmed Kemshead.

Goldstrom said NAI Commercial has noted good interest in light industrial and retail properties.

Salomons has also observed a growing demand for retail space, although much of it is coming from smaller users like restaurants and specialty shops.

“The big box stores aren’t doing anything.”

The market for office space has also been active, said Kemshead, although its the lower-cost options that are moving. Much of the newly completed Executive Place office tower in downtown Red Deer, for instance, remains unspoken for.

“It’s like having a car dealership full of Porsches right now, when people are in the price range for Hyundais and Kias,” said Kemshead.

But, he added, this situation will come around.

“Executive Place will fill.”

Although the commercial and industrial markets look a lot brighter now than they did a year ago, Kemshead is taking things one month at a time.

“I’m very cautious about saying, ‘Yes, we’re climbing out of the recession.’ All it takes is a really bad situation in the U.S. and then we’re scrambling.”