Edmonton’s hottest retail node is about to get even hotter.

The one-two combination of South Edmonton Common and the adjacent Calgary Trail corridor have transformed the area into a dominant retail force that continues to sizzle.

South Edmonton Common, at 320 acres and 2.3 million square feet of commercial retail space, is about two years ahead of schedule in filling its massive terrain, while the adjacent Calgary Trail is well established with big-box retailers such as Linens N’ Things, Toys “R” Us and Canadian Tire.

“Calgary Trail is a very, very strong retail node,” said Neil Calhoun, a partner at real estate firm J.J. Barnicke. “From the Whitemud (freeway) to South Edmonton Common, it’s a powerhouse of retail. It probably ranks No. 1 for most big-box retailers.”

Jack Dagley, for Business Edge
Roy Rolheiser says South Edmonton Common is unquestionably the first choice of retailers coming into Edmonton.

For retailers coming into Edmonton, “South Edmonton Common is unquestionably the first choice,” said Roy Rolheiser, a partner at real estate firm Avison Young. “It’s the sheer size that is attractive to the retailer.”

Expect to see four or five new South Edmonton Common tenants, with synergies to home furnishings, open in mid-summer in a 16,000-sq.-ft. strip building under construction next to Pier 1 Imports.

In addition, Saan, a family clothing and hard goods retailer, will open a 10,000-sq.-ft. freestanding store near Home Outfitters.

Meanwhile, Chuck E. Cheese’s returns to the Edmonton market with an 11,000-sq.-ft. “entertainment” attraction to be located next to Indigo, just southeast of Pier 1. Scheduled to open in late summer, the prototype from the Texas-based chain offers a sit-down restaurant with a mini-amusement park component.

This is in addition to already announced spring openings that will see the relocation and massive expansion of Edmonton’s IKEA – introducing Alberta to its Smaland children’s play concept complete with a video theatre – and the entrance of Sears Whole Home and Best Buy into the city’s retail sector.

Neighbouring Calgary Trail and Gateway Boulevard (formerly Calgary Trail North), while not as active, will still see change. IKEA vacates 133,000 sq. ft. next to the Whitemud, between Calgary Trail and Gateway, for its planned June move three kilometres south. The space is on the market for $15 million.

With little space left on the bustling twin arteries, one new spot has opened up with the redevelopment of the Save On Foods at Calgary Trail and 34th Avenue.

One prospective tenant seeking space in the area is Winners’ HomeSense, which offers brand-name home fashions at discount prices. While the chain already has one store secured at Skyview Power Centre in the north, the retailer is eyeing the south side, said Calhoun.

Regardless of where HomeSense opens on the south side, Paul Messinger, director of the University of Alberta’s Canadian Institute of Retailing and Services, points to two big-box nodes that work well together.

“Gateway Boulevard (and Calgary Trail) are going to remain strong. They’re going to contain the big-box stores. South Edmonton Common will contain the mega big-box stores,” said Messinger.

Having South Edmonton Common nearby also means strong draw IKEA remains in the immediate area while being able to open a larger 300,000- sq.-ft. store that is “much more in line with IKEAs in the rest of Canada,” said Messinger.

Even though South Edmonton Common draws customers away from Calgary Trail/Gateway, Messinger said its growth augurs well for the area.

“South Edmonton is certainly benefiting from retail gravitation, which is what you get when you aggregate so many retailers together – you bring in more retail customers. If you increase the amount of retailing in an area by 100 per cent, you bring in more than 100 per cent additional customers. That’s what happens until you reach saturation and (this part of) south Edmonton has not reached saturation yet,” said Messinger.

South Edmonton Common, for example, is only expected to hit 1.4 million sq. ft. of occupied commercial space this summer. It still has ample room, said Tony Rota, director of marketing for Cameron Corp., South Edmonton Common’s initial and now co-developer.

“There’s still lots of interest from tenants not in this market as of yet,” said Rota.

As deals are pending he would not comment on prospective tenants, but Rolheiser said to expect more restaurants to open on the site. One of those will be Joey Tomato’s, to be built in front of Best Buy. Rolheiser pointed to a pending deal for a significant anchor for the south end of South Edmonton Common – a warehouse club coming in at 175,000 sq. ft. to 200,000 sq. ft.

Ironically, it was the site IKEA is leaving behind that helped to expand the southside retail corridor and create the mega-power centre, said Rolheiser.

“Before IKEA, that building was built for Eagle Hardware, a U.S. home-improvement chain. They weren’t open very long – the company was experiencing a difficult time in the U.S. then – and the building was bought by IKEA,” said Rolheiser.

With Eagle and Revy both in the area, Home Depot decided it needed to position itself to be competitive, said Rolheiser. In late 1994, he made an approach on Home Depot’s behalf to acquire land where South Edmonton Common now stands.

Cameron Corp. subsequently entered the picture, purchasing the land from Canadian Pacific Railway. In April 1997, South Edmonton Common and Home Depot signed the deal that saw the company become the first tenant in April 1998.

“Since that time, the market right across Canada was surprised at how quickly the centre was leased and the progress of the buildout,” said Rolheiser.

“There was considerable skepticism at how a retail centre could work that far south in Edmonton,” said Rota. “The consensus (at shopping centre conventions) was that it would be very insurmountable to develop retail that far from the city core.”

Timing, a strong economy, low cost of living and growth in southern Edmonton all played factors in the quick buildout.