Josan Properties will be converting the lower half of the office building into rental homes while retaining the top office floors.of introducing a financial incentive program to faciliate office conversions like that of Calgary. That is no longer happening after the City was unable to find the funding for the program, but at least one office conversion project is nonetheless carrying on.
After its previous pension fund owner — CN Pension Fund, through Canapen Investments — decided to sell the Phipps McKinnon building along with the nearby Sherlock Holmes Pub and Sorrentino's restaurant properties, Josan Properties acquired the three properties in a deal brokered by"It was really borne out of what happened to the office market during COVID," says President & CEO Raka Josan.
The building, which was originally constructed in the 1970s, had also received a mechanical upgrade — new boilers, new chillers, among other things — in recent years thanks to its previous owner, which means Josan Properties won't have to do that.From a financial perspective, it made more sense because there is no longer going to be any financial help from the City.
"The general consensus of the real estate community here in Edmonton for the last year was, 'Yeah, of course the City will do something; this just makes too much sense,'" Josan says., Managing Director of Avison Young's Edmonton office, says the City just had other priorities and he doesn't expect them to find the money for an incentive program in the next year or two.
"What we're seeing right now, in real time, is some off-market transactions that are in the works that are potentially putting these properties into the hands of investors that are looking very closely at conversion," Wosnack says. "We're going to see only a few. We will not see half a dozen or more that we could've seen with an incentive ."
According to the Building Industry and Land Development Association , every 1,000 new condo units that are cancelled erases $400M in potential economic activity in the GTA.PricewaterhouseCoopers also says 930 creditors have filed a total of $317M in claims against Martel and Shop Your Own Mortgage.As part of the City Plan adopted in 2020, the City plans to become a "communities of communities" by treating Edmonton as 15 distinct districts.