A large block of real estate in Victoria’s downtown core is changing hands.
Two Vancouver developers have purchased two large sites on the south side of Fort Street between Quadra Street and Blanshard Street with the intention of revitalizing and reinventing the retail block.
PC Urban has spent about $13 million for seven buildings covering more than 42,000 square feet — 829, 835, 841, 849 and 891 Fort St. and 850 and 856 Broughton St. — with plans to develop a mixed-used project. The Salient Group has picked up 10,000 square feet at 825 and 827 Fort St., which had been on the market for $3.95 million, with similar plans.
Anne Tanner, managing director of commercial real estate firm Cushman Wakefield, said the deals highlight the fact Victoria is no longer a well-kept secret and Vancouver developers are taking advantage of a growing market, spurred on by the high-tech sector.
Tanner said tech’s boom has meant there are more career jobs in Victoria to attract and retain young professionals and more companies looking for interesting downtown spaces.
The two deals “are exciting for Victoria because if you look at what the companies have done with buildings in Gastown, they want to reinvent these buildings similarly,” she said.
Both deals have just closed and there are no etched-in-stone plans.
“It’s at a drawing board stage,” said Robert Fung, president of Salient Group. “And it won’t be a single-building approach that we take, we have always been about creative, mixed-use communities and mixed-use dynamic downtown spaces. One way or another they will be rehabilitated, redeveloped and reinvigorated to be great spaces with great tenants on the ground floor in an area that has an amazing vibe.”
Fung said one of the reasons he was drawn to the area was the work done to revitalize the western portion of the block near Fort and Blanshard streets.
Fort Properties has invested heavily in its buildings, established new common areas and changing the retail mix to add energy to the block.
“The work they have done is spectacular. They have done the sort of work we greatly appreciate and it’s perfectly in step with the sort of vision we have for how the area will be built out,” said Fung, who said his firm prides itself on urban revitalization and heritage-base redevelopment.
Jayne Bradbury, co-owner of Fort Properties, said new interest in the block vindicates their decision to invest. “We see the purchases as a vote of confidence in upper Fort Street as a neighbourhood, and are looking forward to watching the changes unfold in the 800 block in the next few years,” she said. “We expect that the additional residential developments will be good for downtown businesses, including our tenants at Fort and Blanshard Streets.”
Fung said it’s too soon to say what, if any, residential component will be part of his plans.
Tim Sommer, senior vice president of capital markets for Cushman Wakefield, said there may be residential towers included in PC Urban’s plans for the larger site, which was owned by the Price family. That site is bordered by Fort, Quadra and Broughton streets.
Sommer said deals like this are in part due to developers being “squeezed out of Vancouver.”
“But they see a chance to participate in Victoria by buying these older buildings and being part of a resurgence,” he said. “And part of this is being driven by what’s for sale — there is supply available on this street right now and people see the potential.”
Fung said there’s a lot of upside in Victoria.
“One of the most exciting things is the economic shift to technology and the creative sector in the downtown,” he said, noting that is tailor-made for Salient’s style, which is to redevelop heritage buildings in places like Gastown and New Westminister. “It was synergistic to look at Victoria now because of where we are in our cycle and where Victoria is. And you have gorgeous buildings that need some TLC.”
Recent tenants along the Fort Street block include a fabric shop, a cabinet maker, a lock and safe store, and antiques stores.