I live in a wooden house, the sixth one I’ve inhabited during my life. None of them has suddenly burned down around me, despite the flammability of wood and even despite an incident in my early teens involving a chemistry set.

Public perception of wooden construction doesn’t seem to have suffered after two wooden multiple-unit projects suffered large construction fires in Calgary several months apart.

The Waterford project in Erlton suffered heavy damage May 30. On Nov. 3, a two-storey seniors residence in Coventry Hills was damaged in another fire.

Fire department spokesman Capt. John Conley said the Coventry Hills fire was sparked by a torch during “hot work.” The fire caused $7 million in damage to the two-storey building.

Dave Olecko, Business Edge
Firefighters cool down hotspots at the Harbours of Newport, a senior residential rental complex in Coventry Hills, which went up in flames Nov. 3.

Gary Klassen, general manager of development and building approvals for the city, says both fires involved hot work.

Safety during construction is up to owners and construction companies. The building approvals and fire departments did send a safety reminder to the industry, he said.

Brad Milne, vice-president of Statesman Corp., said last week that following the Erlton fire, some people – particularly in the media – may have felt there was a greater hazard to wooden construction. The development and construction management company says it has itself raised the wooden building issue with potential customers, but adds most still don’t seem averse to wood.

It doesn’t matter whether the construction is steel, concrete or wood – each has advantages and disadvantages. Wood is flammable, but can maintain structure when charred.

“Steel would melt at temperatures less than we had at the Waterford,” adds Milne, whereas wood might remain standing and allow people to escape.

Wood-frame buildings are vulnerable at certain times during construction, but the drywall usually isn’t – before drywalling, builders waterproof the building by putting the roof on.

The building code includes measures to stop the spread of fire after construction is complete and residents have moved in. Regulations require a one-hour fire barrier between apartment units, and two hours between the ground floor and second floor.

The Coventry fire erupted only days after residents moved back into Building B at the Waterford.

Kathy Gieck’s furniture was delivered to her new unit at the Waterford late last month. The communications consultant works from home and was there when the fire started.

When the alarm in her building went off, she only had time to grab her cellphone charger and laptop.

Is she concerned about returning to a wooden building? Apparently not. Gieck has heard other residents say that the fire happened during the window of vulnerability during construction.

She’s pleased with the results of the rebuilding of Building B. The carpet is nicer in common areas and the paint in her unit is better, she says.

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The flight from equity is boosting sales of industrial real estate to investors both in the local market and across Canada.

A study by CB Richard Ellis Alberta Ltd. shows end-users have bought $200 million worth of industrial buildings in the last two years, with a 115-per-cent increase from 2001 to 2002.

Total industrial sales in the Calgary market have gone up almost four times year to date, compared to the same period last year.

Mike Gigliuk, research director for CB Richard Ellis Alberta Ltd., says the increase could be more dramatic by the end of the year.

Equity investors are hoping for an increase in market value. Property investors are buying into a cash flow, he says. Private investors entering the real estate market are leaving their money there until it’s time to retire.

Two-thirds of industrial transactions in Calgary are sales to investors, which CB Richard Ellis vice-president Patrick McFetridge attributes to low interest rates and banks’ willingness to lend 80 to 90 per cent to the best qualified companies.

Investors and end-users aren’t competing for the same buildings. Investors aren’t likely to buy buildings that aren’t leased, and end-users want buildings they can use, he says.

The two demands have led to a shortage of good buildings on the market, says McFetridge.

On the national scene, Royal LePage Commercial Inc. reports leasing down slightly and sales up dramatically in the third quarter of this year compared to the same time last year. Investors have accounted for 51 per cent of the transactions over $1 million since 2001.

The national vacancy rate for the third quarter rose to 4.8 per cent from 4.1 per cent in 2001. Calgary, Edmonton and Vancouver all enjoyed space absorption, but eastern markets suffered job losses in the warehouse, trucking and manufacturing sectors.

Royal LePage reports the industrial vacancy rate in Calgary at 4.8 per cent for the third quarter, down from 5.4 per cent in the second quarter of 2002.

Many logistics and high-tech companies have restructured, leaving large blocks of space, but local distributors have absorbed most of the space.

Royal LePage reports industrial sales in Edmonton were up 77 per cent from last year at the same time, and the vacancy rate fell to 3.7 per cent in the third quarter from 4.6 per cent a year earlier.