Canada ICI and Maclab Development Group break ground on $220-million student housing project
Photo by Maclab Development Group
As post-secondary housing demands are on the rise in Edmonton, Canada ICI and Maclab Development Group work together to fill the void with a $220 million student housing project in the Garneau district.
Post-secondary students in Edmonton will receive a much-needed addition for housing, as Canada ICI has come together with Maclab Development Group to fund one of the largest private-funded student housing projects in Western Canada in the last decade.
Glenn Fisher, director of mortgage origination at Canada ICI, says the project has been in the works for many years.
“The area in which it is located is landlocked, so there are only a certain number of locations where this project could be done. The developer [Maclab] has been assembling this particular site since the 1960s,” said Fisher.
In addition to being one of the fastest-growing metro areas in Canada, the Edmonton metropolitan region is one of the most educated in the world, with more than 100,000 students enrolled in post-secondary institutions in the region. This is a number that will likely be on the rise in the years to come, as the city continues to emerge as a leader in the tech sector, and is among the world’s leading public research-intensive universities – drawing the attention of talented students from across the world to study at one of the top five universities in the country.
The city’s vibrant and innovative technology sector, coupled with the ability to recruit world-class talent in a relatively low-cost jurisdiction, has increasingly begun to attract capital investors like Maclab.
However, as universities in the city resume in-person classes, some students have been left in a last-minute dash to find affordable accommodations, as the on-campus residences routinely go quick, and have waitlists of a hundred people or more.
“Students end up having to select from older assets, or they’re renting a basement of a house … it is a scramble for students, and the universities can only do so much,” says Fisher. “It is certainly an opportunity for developers such as Maclab to fill the void.”
According to the Canada Student Housing Market Report, there are an estimated 350,000 purpose-built student accommodation (PBSA) beds lacking in the country. This demonstrates that there is a great opportunity for investors to diversify their portfolio, as well as build a strong brand presence in this untapped asset class, which is not yet overcrowded by a large number of off-campus PBSA companies.
The Garneau project demonstrates that there is room for growth in this asset class, being that Canada ICI and Maclab were able to finalize this deal during the middle of a pandemic, even while no students were in classes. And while there has been some uncertainty surrounding the student housing market over the past year, it is believed that Canada’s established position as an education market, along with its low student housing provision rate, will allow the sector to grow significantly once the pandemic has been curbed.
The Garneau project will consist of two separate towers built upon a podium with 6,600 sq. ft of commercial retail space, and a two-level underground parkade below. The first of the two towers will be dedicated to student housing, while the second tower will have space for not only students, but will be able to support the University of Alberta hospital doctors, nurses, and educators as well.
Together both towers will have a combined total of 175 student residences, 260 market-residential high-rise units, and 12 single-family townhomes fronting 86th Avenue.
The project, which has begun construction as of October this year, is expected to reach completion in the fall of 2023.