Talk about a mystery. Mention Calgary to most people and they’ll recall it was once an Olympic host city, and maybe if you’re lucky they’ll name-drop the sometimes notorious Stampede (the annual cowboy shindig is not a popular event with animal welfare organisations). Current helmet-haired Canadian Prime Minister Stephen Harper hails from Calgary, as does NFL MVP quarterback Mark Rypien. Then again, so does Glee star Cory Monteith, but we won’t hold that against a whole city.
Investors may know a little more, but the city is still something of a mystery, overshadowed often by nearby Vancouver and the country’s major business centre, Toronto. But that could, and probably should, change in the coming years given Calgary’s elite position within the energy industry and its power ranking inside the province despite not being the capital.
“The [Calgary] market was slower to recover from the global recession in 2008 than either Toronto and Vancouver,” explains Ashley Osborne, executive director of international properties for Colliers International in Hong Kong. “The energy sector is continuing to drive the economy and jobs pull population growth from other provinces and abroad.
That’s an understatement. Alberta has experienced some of the fastest economic growth anywhere in the world for 15 years running. The province is debt-free, boasts the lowest corporate taxes in the original G7 and the lowest corporate and personal taxes in Canada. The energy industry (oil and gas) generates and average of $100 billion in revenue, and Calgary is home to approximately 1,500 energy companies. The city has the fastest employment growth in Canada and a young, educated labour force among its one million-plus residents — and skilled labour is still in short supply. The tourist numbers the Rocky Mountains generate is a bonus (3.2 million arrivals to the Rockies alone in 2010 according to the ministry of Tourism, Parks and Recreation) and should get better after Calgary International Airport’s fourth runway opens in 2014.
Yeah. About those mountains. “Many Asian buyers have abundant capital, usually spend heavily and are more likely to invest in overseas properties. Currently, Canada is one of the most popular places for them to invest in,” theorises Cherrin Loo director and head of China international residential sales at Savills in Hong Kong. “Many of the properties offer homebuyers ample space, amazing natural scenery and spectacular landscapes, which no one can resist.”
But for all its economic robustness and natural splendour, Alberta is the beating heart of Canadian-style conservatism. If Canada has its own Texas, it’s Alberta. The more liberal attitudes nearly synonymous with Canada are more frequently found in British Columbia, Ontario and Québec, and in all fairness that’s a concern for some. That said, if Texas has progressive and easy going Houston, Alberta has Calgary — the province’s proudly progressive oddball. And for all Alberta’s “small government” rhetoric, the provincial government, the public health sector, the City of Calgary and public schools (including universities) were among the provinces largest employers.
So who buys property in Calgary? For now it’s largely concentrated in local buyers, but with the energy industry so prominent — and the one most in need of radical innovation that tends to creates jobs — investors may start lining up. “The market is primarily local and for enduse or some investment,” notes Osborne. “That said there are rumours of the odd project being marketed in China.” Canada’s stability makes it a wealth haven, and the country has a welcoming immigration policy. In addition there are no restrictions on purchasing property in Canada. As it stands, international flights are predominantly to the United States and Europe and, “Calgary is a one hour flight from Vancouver,” Osborne admits, “but [it] has less desirable climate. In fact, most Albertans vacation in BC in the summer.” Alberta is renowned for its cold.
To go back to the Texan analogy, there may not be that many “Southfork”s in Calgary, but houses are still the way to go. “The single family home is still king especially for the wealthy who prefer to dwell in large custom homes on half to two-acre lots [a] 20 to 25-minute commute from downtown,” states Osborne. “The multifamily market in the downtown core is not nearly as deep as Vancouver and Toronto with average values in the $400 to 600 (HK$3,000 to $4,500) per square foot range. It is showing signs of life as projects that were shelved move ahead again and one or two new offerings enter the market, such as East Village,” the 49-acre development mixing townhouses, condominiums, retail and commercial on the Bow River, not surprisingly just a few minutes from the downtown core. Could be that a decade and a half of upward growth and viable industry outside of energy (agriculture, tech and transportation among others) have perched Calgary on the cusp of a major renaissance. And there are those mountains.