What do you think of this project?

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whattheheck said:
What a misinformed comment. OEG didn't 'abandon' anything. As a private sector developer, they obviously ran the numbers and the return on investment wasn't there.

There seems to be a lot of misdirected anger at why developers are not building downtown. The question should be WHY no one is building DT.

Here's a hint: despite all the armchair cheer leading here, the DT generally sucks, is seen as unsafe, not accessible. And the irony, to see the push back on this same forum on the idea of back to work at the office in the DT.

Oy.
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Here’s the issue. When OEG designed this whole thing, part of the momentum behind the retail, especially massive tenants like city market, was that there would be thousands of new permanent residents literally connected to these buildings or within 2 blocks. OEG was entirely in control of the entire vision and promises made to retailers coming in.

Then, through a mix of bad luck with covid, a growing drug crisis, etc, things got harder. OEG also made some poor choices like the copy cat Toronto sky residences which had no chance of succeeding in a very different condo market. Then they scaled back other plans, delayed the 3rd tower, lost momentum, didn’t move on phase 2 at all, and boom, here we are.

Obviously there were lots of external factors. But I’d argue they hurt themselves a lot too. Mega projects can create momentum of their own, but when you stop 20% into them, you jeopardize the success of it all. City Market needed 3000 new residents in the area. And OEG barely gave them 500…
 
^ These are conditions that could happen anywhere (and do) -- we build on what we can but we don't start clutching our pearls in response to market conditions and "what ifs" Edmonton is not going to solve every problem confronting it "next year" -- look at positives on the horizon and be patient about getting there.
 
archited said:
^ These are conditions that could happen anywhere (and do) -- we build on what we can but we don't start clutching our pearls in response to market conditions and "what ifs" Edmonton is not going to solve every problem confronting it "next year" -- look at positives on the horizon and be patient about getting there.
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Yes, a big project that takes years to complete is based it on the conditions when you start it and what you expect to happen. Of course things can and do change, in this case way more dramatically than expected.

Here it wasn't just a negative economic change which is not so unusual, but also COVID which was very unexpected/unusual and which led to a huge change in people not going downtown for an extended period of time.

Yes, that is mostly over now. However, it is kind of like big disaster, an earthquake or a forest fire, you can't just quickly recover and the after effects are still being felt. It takes time to get things back on track.
 
What's sad to see is that there are always breakdowns in any kind of initiative directed at improving Edmonton. Start a business, criminals start hanging out there. Improve transit, criminals ride the train or try to ride buses for free. Build infill housing, somebody will burn it down. Build a park, open drug use will take place there.
 
thommyjo said:
Here’s the issue. When OEG designed this whole thing, part of the momentum behind the retail, especially massive tenants like city market, was that there would be thousands of new permanent residents literally connected to these buildings or within 2 blocks. OEG was entirely in control of the entire vision and promises made to retailers coming in.

Then, through a mix of bad luck with covid, a growing drug crisis, etc, things got harder. OEG also made some poor choices like the copy cat Toronto sky residences which had no chance of succeeding in a very different condo market. Then they scaled back other plans, delayed the 3rd tower, lost momentum, didn’t move on phase 2 at all, and boom, here we are.

Obviously there were lots of external factors. But I’d argue they hurt themselves a lot too. Mega projects can create momentum of their own, but when you stop 20% into them, you jeopardize the success of it all. City Market needed 3000 new residents in the area. And OEG barely gave them 500…
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Agreed. But also things were well set up before COVID to proceed with the planned residential towers. And the parks, falcon and switch were all initiated in 2021 during the same conditions

The value of the Oilers had skyrocketed by start of 2020.

In 2018, OEG sold the Edmonton Tower to the Alberta Investment Management Corporation (AIMCo).

OEG sold the commercial portion of the Stantec Tower to German real estate company Deka Immobilien in 2019. This sale involved over 620,000 square feet of office space and 62,000 square feet of retail space.

With those sales, OEG freed up a ton of capital before 2020 to keep the momentum going and were even given a municipal incentive in 2021 to proceed with tower. But everything stopped except its activation of the 101st parking lot for events - and we see the result with Connect Centre bank proliferation.
 
TAS said:
Agreed. But also things were well set up before COVID to proceed with the planned residential towers. And the parks, falcon and switch were all initiated in 2021 during the same conditions

The value of the Oilers had skyrocketed by start of 2020.

In 2018, OEG sold the Edmonton Tower to the Alberta Investment Management Corporation (AIMCo).

OEG sold the commercial portion of the Stantec Tower to German real estate company Deka Immobilien in 2019. This sale involved over 620,000 square feet of office space and 62,000 square feet of retail space.

With those sales, OEG freed up a ton of capital before 2020 to keep the momentum going and were even given a municipal incentive in 2021 to proceed with tower. But everything stopped except its activation of the 101st parking lot for events - and we see the result with Connect Centre bank proliferation.
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That’s what I don’t understand. How does the rental tower not work when the foundation and everything is already built…. Yet multiple other concrete towers have proceeded since.
 
thommyjo said:
That’s what I don’t understand. How does the rental tower not work when the foundation and everything is already built…. Yet multiple other concrete towers have proceeded since.
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Same reason telecommunications, banking companies have bamboozled our government for decades spinning PR like: it costs a lot to put infrastructure in Canada, competition will hurt us, the list goes on and on. In this case, the market just doesn't work or whatever they are cooking up. I imagine it is more along the lines of Katz wanting certain profit margins and this project not meeting whatever that looks like.

I get that Katz is in it to make money, but we just handed him over the bag again without the previous development finished. Now they are literally selling off chunks of it to pay for the next phase. Unfortunately, the public is always left holding the bag with these things whether it is high fees or left with unfinished projects after our investment. Meanwhile, they'll put out some PR about how the Ice District is great and the majority will eat it up.

I woke up cynical this morning.
 
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TAS said:
Agreed. But also things were well set up before COVID to proceed with the planned residential towers. And the parks, falcon and switch were all initiated in 2021 during the same conditions

The value of the Oilers had skyrocketed by start of 2020.

In 2018, OEG sold the Edmonton Tower to the Alberta Investment Management Corporation (AIMCo).

OEG sold the commercial portion of the Stantec Tower to German real estate company Deka Immobilien in 2019. This sale involved over 620,000 square feet of office space and 62,000 square feet of retail space.

With those sales, OEG freed up a ton of capital before 2020 to keep the momentum going and were even given a municipal incentive in 2021 to proceed with tower. But everything stopped except its activation of the 101st parking lot for events - and we see the result with Connect Centre bank proliferation.
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Maybe at some point Katz realized or decided it should not fall entirely upon him to revitalize or save our downtown, perhaps around the time COVID happened. Fortunately there are several other projects nearby that have gone ahead and are going ahead, so maybe we don't need to look at him as our sole savior. Partly because of this after the switch of Connect Centre to office development fell through, it wasn't as necessary or viable to go back to residential development right away. The nearby Event Park and related residential development will be good for Edmonton and the downtown core when they happen.
 
David A said:
Maybe at some point Katz realized or decided it should not fall entirely upon him to revitalize or save our downtown, perhaps around the time COVID happened. Fortunately there are several other projects nearby that have gone ahead and are going ahead, so maybe we don't need to look at him as our sole savior. Partly because of this after the switch of Connect Centre to office development fell through, it wasn't as necessary or viable to go back to residential development right away. The nearby Event Park and related residential development will be good for Edmonton and the downtown core when they happen.
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Then why did we decide to give him more money for the event park? The second try is the charm? Anyone who thinks he is doing any of this out of goodwill needs to give their head a shake in my opinion.
 
Tropical said:
Can someone please educate me - so why can't the rental tower be built? And I'm not talking about costs and market conditions - is there something about the foundation or ownership that means this won't happen? (Or are we just panicking based on a rumor?)
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I don't think it is that it can't be built; more that the current owner will not be doing so and has listed the property for sale. Whether the next owner proceeds with something is unknown at this point.
 
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