When Garry Beres flew between Calgary and Houston recently, the planes were packed in both directions.

The aircraft were full of business people and their interests went beyond oil and gas, says the executive vice-president of CB Richard Ellis Alberta Ltd.

So it’s no surprise that Calgary was named as one of only two healthy commercial real estate markets in North America in a new survey by Merrill Lynch. The other city was Toronto.

The Merrill Lynch survey covered 75 markets in 40 U.S. cities and four Canadian cities. The markets were examined from an investor’s point of view, says Louis Forbes, one of two Toronto analysts in Merrill Lynch’s North American real estate team. “We are equity analysts,” he points out.

Along with Calgary and Toronto, the Canadian cities added to the survey are Montreal and Vancouver. The cut-off was determined by market size and Edmonton and Ottawa, both important markets on a Canadian scale, just missed it, he said.

Montreal and Vancouver were among only seven cities with stable markets, including midtown Manhattan and the central business district of Los Angeles, said Merrill Lynch. The study showed the four major Canadian office markets are in better shape than their U.S. counterparts, with market rents slipping everywhere but Toronto and Calgary.

At the end of last year, the average vacancy rate was 8.5 per cent in Canada and 14.7 per cent in the United States.

Distressed markets – those with vacancies near or above 20 per cent and sharply falling rents – include San Francisco, Silicon Valley, Atlanta and Minneapolis.

Calgary has seen rising vacancies this quarter, says Carla Fedele, research director for Royal LePage Commercial Real Estate. The merger and acquisition activity in the oilpatch has led to consolidation of space, and the rise will continue over the first two quarters.

Fedele says Royal LePage expects recovery in the third quarter.

There is still activity in the market, and oil and gas are both strong economic forces. “But there are significant sublease pockets,” she says.

Richard Schwann, vice-president of J.J. Barnicke Commercial Real Estate in Calgary, says there is a strong office market here. On the investment side, a lot of pension funds are interested in Calgary real estate.

Beres, of CB Richard Ellis, says energy still drives the economy, but Calgary is increasingly important as a financial centre and distribution hub.

“We have become the financial centre of Western Canada, replacing Vancouver, but I’m not sure if Vancouver ever was,” he says.

In the big economic picture, British Columbia still needs to get its economy turned around and to reduce taxes. Alberta and Ontario already have their houses in order. Major oil and gas projects planned for Alberta mean a lot of money will be spent here in the next decade. That will draw attention to Alberta, as will tax reductions when the province is finally debt-free.

Economic growth feeds more growth and a lot of people want to live and work here.

Calgary is also a hot spot for both wireless technology and biotech research at the university and in the private sector, he notes.

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Alberta’s construction industry garnered three of seven awards from the Canadian Construction Association (CCA) at its annual conference last week in Phoenix, Ariz.

The Calgary Construction Association won the Jake Thygesen Award for leadership in education, recruitment, and image enhancement.

The national association cited Calgary’s lobbying for infrastructure funding and its education programs that have provided dozens of young Calgarians with work experience and employment.

“We’re very pleased to have won that,” said Dean Slater, past-president of the Calgary Construction Association.

Slater said the association has addressed the need to bring young people into the industry through youth employment programs in partnership with Alberta Human Resources and Employment.

Ledcor Industries Ltd. of Edmonton won the Gordon M. Vipond Memorial Safety Award, recognizing commitment to and achievement in workplace safety. Ledcor was praised for launching an aggressive safety program after the death of its founder in a worksite accident in 1980.

Don Oborowsky, president of Waiward Steel Fabricators in Edmonton, won the Ernest Dobbelsteyn Award for making an outstanding contribution to the CCA Trade Contractors Council and to the industry in general.

He has been involved in the Canadian Apprenticeship Forum and the Construction Sector Council, and chaired development of the Build-Up CD. He has also raised thousands of dollars for scholarships.

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A Calgary investment company has agreed to buy a half interest in Eau Claire Market.

Proprietary Industries Inc. said it agreed with Patriot Equities Corp. of Toronto to buy a half interest and enter a joint operating agreement with Patriot.

It will pay $17.5 million, comprised of Proprietary’s proportionate share of the project debt and about $5 million cash.

Proprietary president Peter Workum told Business Edge he was extremely pleased with the acquisition. “It’s a vital piece of Calgary’s downtown life,” he said. Proprietary is planning upgrades to the property.

Meanwhile, Proprietary said last week that the Alberta Securities Commission staff had written to the company, saying its 2001 financial statements were “deficient.”

Proprietary said it will try to resolve the commission staff’s concerns, but will proceed to a hearing before the ASC if necessary.

Proprietary closed Friday at 70 cents, down 15 cents on the Toronto Stock Exchange. Its 52-week high and low are $4.70 and 56 cents.