SUNDRE – Fresh off a substantial year of investments that in 2023 saw the value of permitted construction projects in town topping $9.5 million, the municipality is early on in 2024 already shaping up for another potentially eye-popping year.
During a presentation of departmental report highlights at the regular Feb. 26 meeting, council heard that a single project comprised of residential and commercial components had already brought in a major investment to revitalize the former Parkwood Motor Inn located at 307 Main Avenue West in a central commercial district.
The $1.8-million project is broken down into $1 million residential component as well as an $800,000 commercial element in the form of a laundromat extension to the existing building.
The design presented by the developer, Andrea Warkentin from Red Deer, and subsequently approved by the municipality includes a total of 24 dwelling units – 12 bachelor units, seven one-bedroom units as well as five two-bedroom units.
Coun. Owen Petersen said he felt that result was a testament to what council and especially administration have done to persuade developers to create more housing in town.
“On our level of what’s in our control, I think that Sundre is doing good things to bring more housing into our community, because this is a struggle across the entire country and it’s really exciting to see that (project) come,” said Petersen.
Betty Ann Fountain, senior development officer and special projects co-ordinator, told the Albertan on Feb. 28 in response to follow-up questions sent earlier that same day that the commercial aspect of the project is for a laundromat.
The work to convert the motel into a residential rental accommodation has already commenced, said Fountain, adding that the project’s estimated timeline of completion is unknown.
“This development will add much needed rental accommodations to the community,” she said.
All about the math
Warkentin is a licensed commercial and residential Realtor from Red Deer who partnered up on this project with an Edmonton-based colleague named Brenda Bastell.
With a penchant for adding into her portfolio properties from the Central Alberta region located within about an hour of home, Warkentin told the Albertan on Feb. 28 when asked what in particular appealed to her about the potential she saw in Sundre that last year was a difficult time “to source multi-family properties that financially made sense” as a result of factors such as inflation.
“It was hard to make the math work. And you know, real estate investment’s all about math,” she said during a phone interview.
But where some might have seen a borderline dilapidated building in desperate need of repair or even replacement, Warkentin said she saw the chance to revitalize part of Sundre’s downtown core.
“I looked at it as an opportunity to buy something that’s run down, renovate it, and turn it into something beautiful that would serve the community,” she said.
“Basically, within an hour of it being listed, I already had my offer in.”
Following some conversations with a receptive administration keen to collaborate on making the project possible, the only caveat was to maintain a commercial aspect because of the area’s zoning and a laundromat was the most logical choice, she said.
“Because essentially what we’re doing is we’re taking 33 motel units plus the owners’ residence and office area, and we’re converting it into a 24-unit building plus laundromat,” she said.
That includes what she describes as “micro suites” for bachelors that offer roughly 250 square feet of space, she said, adding room quickly becomes scarcer with the addition of kitchen spaces. So a shared common-use area for a laundromat also made sense from a space-saving perspective.
“When you talk about micro suites, every inch counts,” she said. “So the natural fit to do a laundromat is not so much to be a competitor to other laundromats in town by any means, but it is satisfying the condition of the building permit that we have some sort of commercial operation.”
The plan also includes four handicap-accessible units, she said.
“We really wanted to do that as well; I think that type of unit is very much needed probably all across Canada,” she said, later adding, “it’s really important to have a mixture of units.”
Federal program offers incentive
Warkentin also cited a federal government program called MLI Select that is intended to help provide more housing across the country as another factor that solidified their decision. While regular commercial mortgages with the Canada Mortgage and Housing Corporation could get up to a 30-year amortization on financing, the MLI Select has options up to 50-year amortizations, she said.
“What that does, is it allows investors like us to make sense of the math. Because there’s a lot of older buildings and they can be money pits,” she said, adding that the nearly $2 million cost to renovate the old motel is no small sum.
“Everything in the building is pretty much pooched,” she explained. “So, it’s all new water lines, all new heating system, we have to put all new electrical in there. It’s basically gutting it back to the studs.”
To boot, the work must also factor in clearing out hazardous materials as there remained asbestos in the dry wall tape, she said.
“So all of that’s been removed. We’re really trying to do this the right way,” she said, adding they in theory could have done a minimal amount of work before renting rooms.
Pride of ownership
“But we really wanted to provide something nice that people can be proud of to live in,” she said, adding they also wanted to redecorate the building’s exterior so it looks more like an apartment and less like a motel.
“It’s important for people to have pride in where they call home,” she said.
The feedback they’ve heard to date also seems to have encouraged the developers.
“I think we have a lot of community support; there’s been a lot of people who stop by asking when the rentals will be available,” she said.
“I’m hoping within six months we’ll have people living there,” she said, recognizing any number of factors involved in such a big undertaking could lead to unanticipated delays.
“I think it’ll be a great asset to the community to have more housing available,” she said.
Warkentin also suggested that breathing new life and purpose into old buildings with outdated uses could be part of the way forward.
Adaptive re-use
Referring to a municipal development strategy called “adaptive re-use,” she cited as an example the City of Chicago, where plenty of historic warehouses and manufacturing spaces that sat vacant along waterfronts were refurbished into condos and office towers.
“I think that adaptive re-use will be coming to a town near you,” she said.
“Because there’s a lot of buildings sitting empty – whether they’re office towers downtown Calgary or business centres up in Edmonton – there’s opportunity to re-use these buildings for a better purpose,” she said.
“We’re taking an under-utilized asset and we’re making the most of it.”
That potential also exists in smaller communities.
“I really like secondary and tertiary markets because I believe that people under-appreciate them, but they have a lot of value. And I find that dealing in the secondary and tertiary markets, you get way more buy-in from the community because you actually meet those people,” she said, referring to local leaders with a vested interest in seeing their communities grow responsibly.
“And I think that as we become more community-minded and more environmentally-friendly people, is seeing the opportunity to not just tear something down but to revitalize it, is appealing to a lot of people.”
