First Capital Realty – Edmonton Brewery District

First Capital picFirst Capital Realty incorporates the look and history of a former brewery into its latest shopping center development.

By Tim O’Connor

Edmonton is a tough place to live for those who love shorts and T-shirts. The temperature is cold most of the year, averaging about 13 F in winter and topping out at about 64 F in summer, according to Canadian government statistics. “Nine months of winter and three months tough sledding,” jokes Ralph Huizinga, vice president of acquisition and development for Canadian developer First Capital Realty. So when the weather is nice, Edmonton residents want to soak in as much of it as possible.

With the Edmonton Brewery District, First Capital Realty is creating a shopping experience that caters to that Edmonton lifestyle. On warm days, people are drawn to the center’s rooftop restaurants and wide pedestrian pathways. In the winter, visitors can slip on their light athleisure wear, park in the underground climate-controlled garage and enter their gym without ever needed to brave the frigid air outside. The mall itself connects to a multi-use city trail used by bicyclists and joggers alike. “You have to provide for that opportunity,” Huizinga says.

First Capital has successfully struck a balance between convenience and fresh air. “It’s tough in a city like Edmonton because as much as you want to create that environment, you’re dealing with an environment that’s inhospitable for most of the year,” Huizinga adds.

Knowing how to develop a shopping center that blends customer experience with tenant needs comes with experience. First Capital Realty built, owns and manages 160 properties in Canada, making it one of the country’s largest developers of grocery-anchored, urban properties. “The national platform is important because it allows us to be flexible in terms of our capital spend,” Huizinga says. First Capital can shift its spending to strong markets that warrant investment while holding off on investing in markets such as Alberta, where low energy prices have stymied growth.

The Brewery District is one of the company’s most interesting developments. The project takes its name and design inspiration from the Molson Brewery, a 103-year-old, 85-foot tower located on the western portion of the property. The brewery and an adjoining building recently received a historical designation from the province of Alberta and city of Edmonton. First Capital box

The city agreed to contribute $4.2 million toward the restoration of the brewery with the understanding that it will be repurposed for new businesses. “We’re actually going full circle on the use,” Huizinga says. “We’re going to have a microbrewery and restaurant in the first floor of this thing.”

The other four floors of the brewery will be turned into industrial-style office space. The former administration building adjacent to the brewery will likewise be retrofit for a sandwich shop and basement wine bar.

The old brewery building is just a portion of the total project area, which will encompass 289,300 square feet of retail space and another 40,000 square feet for offices. The total budget of the project is about $120 million.

Phased Development

The Brewery District project began with land assembly. The site was previously a Chrysler car dealership and operating brewery separated by a city road, 120th Street. An adjacent shopping center owned by Sun Life Financial served as the only possible location for all-turns access into the Brewery District, so First Capital entered into a joint venture agreement with the financial company to secure that access. First Capital then took ownership over the road and the city granted approvals to rezone the site to be used as a retail center.

The development is occurring in phases. Construction on the first phase, consisting of a 6.5-acre underground, single-level parkade and the first three surface buildings, commenced in 2014 and has since opened. The shopping center now boasts several retailers and restaurants including Loblaw’s City Market, Goodlife Fitness, Shoppers Drug Market, South St. Burger, a spa, high-end massage business and large physiotherapy provider. Mountain Equipment Co-op, an outdoor recreation retailer, is expected to open in a 40,000-square-foot, two-story standalone building this spring.

Restaurants and anchor retailers may bring in the crowds, but First Capital is working to get a healthy mix of other businesses into the center. Customers today want tenants that can support all aspects of their lives, so First Capital is talking with spas, medical labs and even daycare providers about relocating to the Brewery District. “Getting the right mix is important to the success of any center,” Huizinga says.

Adding Accessibility

Among the challenges in building on the Brewery District is the city’s plan to construct a light rail line through area. As part of the approval process, First Capital had to negotiate a swap with the city for 15 meters of frontage land in the median of 104th Avenue to eventually accommodate a rail stop. Although it meant less space for the development, the rail stop will bring thousands of visitors to the Brewery District’s door.

Once built, the Brewery District would be only a few stops away from Edmonton’s Ice District, a mixed-use sports and entertainment area that is home to Rogers Place, where the Edmonton Oilers play hockey. Huizinga says the Ice District lacks adequate parking for all its visitors so it is expected that some people will park at the Brewery District, where there is plenty of space, and then take the train to the stadium. After the game or concert, those people are likely to enjoy the Brewery District’s many pubs and restaurants.

Two years after construction began, the Brewery District development is about 75 percent complete. The next phase will include the restoration of the brewery tower, the Mountain Equipment Co-op structure and another restaurant with rooftop bar. Originally, the development called for a restaurant on the key corner of 121st Street and 104th Avenue, but Huizinga says First Capital is now exploring a hotel on that spot.

Edmonton, like all of Alberta, has struggled economically in recent years due to falling energy prices creating a lack of investment in the region. But Huizinga says the mix of retail and quick service restaurants in the Brewery District has so far mitigated sales issues for the shopping center.

The development is 70 percent leased and several more tenants are looking to move in. “Preliminary reports from our tenants are that they exceeded their sales projections for their stores,” Huizinga says. “The response from the community has been good.”

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