Developers of mixed-use projects for downtown Calgary say that projects work well as long as partners share a common vision and retail, commercial and residential uses are kept separate.
You have to share the same desire for mixed-use because it is not easy to do,” says Todd Werre, Development Vice President of Westcorp Properties Inc., the firm developing Heritage Station in southwest Calgary. “There are lots of challenges in terms of differentiating between the uses physical and operationally. There is going to be overlap; the challenge is to minimise that and be able to articulate those costs and rationalize them to both sides because nobody wants to pay for somebody else’s stuff. Those challenges also present opportunities, in terms of diversified cash flow stream, a real sense of community and convenience for the people that live in the projects.”
John Torode, the visionary behind Hotel Arts and Ramsay Exchange, agrees that shared visions simplify projects. “A classic project is a hotel with condominiums attached to it,” he said. “It helps the condos sell and the hotel stands on its own merits.”
When he bought the former Holiday Inn, for example, he kept the existing management team in place and benefited from their experience in the industry to switch the operation to a boutique hotel.
You really need to understand your market and who is going to live there, why they are living there and what they need to live there comfortably,” says Werre, “If you don’t attract the right retail mix, the retail component of a mixed-use project becomes a hindrance to the project and the businesses will be challenged because it is an environment where everybody has to live together.”
Note: This article was published on page 45 of Canada’s Leading Real Estate Forum, Ottawa, Fall 2012 as part of a bigger Issues Concerning Calgary Developers story.
