Spruce Grove has been experiencing a declining supply of serviced industrial land, particularly larger parcels of 10 plus acres, which is affecting our competitiveness in attracting new industrial investment. Council approved an initiative in the 2019-21 Corporate Plan to assess the situation and develop a strategy to help the City increase the supply of serviced industrial land.
Altus Group was retained to prepare an Industrial Land Strategy which was completed in November 2020. The objectives of the Strategy are to:
- Provide the City a better understanding of the existing and future state of the region’s industrial sector, and the current supply and demand characteristics of the City’s industrial lands;
- Help the City respond to future forecasted demands for industrial lands; and
- Provide options for ways the City can increase the supply of serviced, ready-to-go industrial employment lands.
As part of the strategy, a Cost Model was developed to determine the costs of acquiring and developing vacant land into serviced industrial lots. The average costs consider both urban and rural development standards and include cost of land, off-site levies, servicing, stormwater facilities, grading, access, fibre optics, etc.
The Industrial Land Strategy sets out a range of options for the City to consider to increase the supply of serviced industrial lands. These options have categorized into the two broad approaches as follows:
- Approach One: Incentivize investment in Spruce Grove by existing and new industrial land developers through a combination of policy and regulatory changes to enhance the business case for developing industrial lands.
- Approach Two: In addition to the options identified for Approach One, this approach takes the additional step of having the City take a more direct role in the acquisition and development of serviced industrial land.
Ultimately, a combination of these options may be necessary depending on how the market responds to the need for increasing the supply of serviced industrial lands to meet potential demand. The impact of Covid-19 has slowed absorption in 2020 but this is expected to quickly rebound as the economy starts to recover. As of 2020, there are 109 net acres available which works out to roughly a 4.5 year supply of serviced industrial land. A significant portion of the vacant land (43 acres) is encumbered by pipelines or has other issues such as the extensive use of cul-de-sacs which affect its marketability. This combined with other factors that are identified in the report result in little selection for potential developers/owners particularly for larger parcels.