New development to double size of area's retail power centre
Winnipeg Free Press
Thursday September 8 2005
By Murray McNeill - Business Reporter
ANOTHER $50-million-plus retail development is planned for what is already one of the fastest-growing retail hubs in the city.
Calgary-based Hopewell Developments Inc. will break ground later this month on a new 20-hectare development that is expected to nearly double the size of the Kenaston-McGillivray retail power centre in southwest Winnipeg.
When complete in three to five years' time, the Hopewell development is expected to add another 450,000 square feet of retail space to the area, which already boasts a host of big- box retailers such as Wal-Mart, Canadian Tire, Canada Safeway, Sobeys and a soon-to-be-opened Home Depot store.
It's also expected to draw more traffic to an already-congested area, although the planned $44-million Kenaston Boulevard underpass near Kenaston and Wilkes Avenue should help improve traffic flows in the area when construction finishes in 2007.
The anchor tenant for the new Hopewell development, which will be situated on the northwest corner of the intersection and will be called Kenaston Common, will be a new 104,000-square-foot Rona Home & Garden store. Construction of the Rona outlet -- the Quebec-based retailer's third big-box store in Winnipeg -- is to get underway later this month and should be complete next spring.
Rona officials were unavailable for comment yesterday. Ron Holowatuk, Hopewell's vice-president of retail, said negotiations are also underway with more than a half a dozen other retailers who are interested in leasing space in the new development.
They range from restaurants to clothing stores "and everything in between."
Holowatuk said Hopewell officials hope to have a number of them signed up within the next four to six weeks. The development is expected to include more than 17 buildings and in excess of 20 tenants.
The Hopewell project is the latest phase in the development of the Kenaston-McGillivray area as one of six major retail hubs in Winnipeg. In the space of six or seven years, the area has gone from essentially no retail development to 515,000 square feet of developed "land and floor area" as of 2004, city figures show.
However, that doesn't include a new 42,000-square-foot Cinema City theatre complex that opened in the area earlier this summer, and the addition of a new 95,000-square-foot Home Depot outlet in November will boost it to more than 650,000 square feet. Add another 450,000 square feet from the Hopewell project and the Kenaston-and-McGillivray area will be close in size to several other major retail hubs in the city -- the areas around the St. Vital and Garden City shopping centres. However, it will still be well back of the city's two largest retail hubs -- the area around Polo Park and the Regent Avenue-Lagimodiere area in east Winnipeg.
Construction of a new Rona store and other retail outlets in the Hopewell development will help fuel construction activity in the city in the coming months. This has been another busy year for local construction firms, even though new Statistics Canada figures issued yesterday show building permit activity hit the skids in July.
The figures show there was a 43.4 per cent drop in the value of residential and non-residential permits issued in the province in July, and a 53 per cent drop in Winnipeg alone. Most of that decline was on the non-residential side of the market, where the value of permits issued in the province fell by 65.5 per cent from June ($82.1 million compared to $144.9 million in June).
Ron Hambley, executive vice-president of the Winnipeg Construction Association, said yesterday he was surprised by the Statistics Canada numbers because most of the construction companies he's talked to recently say they've had a busy summer.
Hambley said the only reason he can think of for the weaker permit numbers is that two weeks of excessively rainy weather in June may have delayed the start of some projects in July, which would have resulted in fewer permits being taken out.
He also noted that after the first seven months of the year, the value of non-residential permits issued in the province was still running six per cent ahead of last year's pace for the same period.
Patrick Hamilton, president of Stevenson Real Estate Group in Winnipeg, which worked with Hopewell in planning Kenaston Common, said Kenaston and McGillivray is a natural spot for retail development because of all the residential growth that has taken place in the southwest quadrant of the city over the last 20 years with such middle-class housing developments as Linden Woods, Linden Ridge, and Whyte Ridge.
Also soon to be added to that list is the giant Waverley West subdivision, Kennedy added. Construction of the first phase of that 13,000-home development could begin as soon as next fall.
Holowatuk said that's one of the reasons why Hopewell officials, including company president and Manitoba native Kevin Pshebniski, are so excited about the Kenaston Common development. "We consider it one of the strongest retail nodes in Winnipeg, with excellent potential for further growth with Waverley West and everything."
Hamilton said there will only be a few other pockets of land left to develop in the Kenaston-McGillivray area once the Hopewell project is complete, and they're mostly on the southeast corner of the intersection..
The president of Fairweather Properties Inc., the Winnipeg real estate development firm which owns much of the land on that corner, confirmed there are still about 18 to 20 acres (7.2 to 81 hectares) of vacant land in the approximately 50-acre (20.2 hectare) site.
Michael Nozick said Fairweather officials also are negotiating with a number of prospective new tenants for its site, and hope to have some deals done by the end of this year.
murray.mcneill@freepress.mb.ca
Ranking the centres
Here is the 2004 ranking, in terms of the number of square feet of developed land and floor areas, of the six areas in Winnipeg which have been designated as "areas of regional, commercial and mixed use concentration" under Plan Winnipeg:
1. POLO PARK: 4,060,000;
2. REGENT AND LAGIMODIERE: 2,780,000;
3. ST. VITAL: 1,220,000;
4. GARDEN CITY-LEILA AVENUE: 1,170,000;
5. KENASTON AND MCGILLIVRAY: 515,000;
6. The area around the former Unicity Shopping Centre site: 472,000.
-- Source: The City of Winnipeg