By Mario Toneguzzi

Retail giant Lowe's Canada plans to operate a new 1.23 million-square-foot distribution centre just outside of Calgary as part of its strategy to optimize its distribution network to better meet the needs and expectations of its in-store and online customers.

The new distribution centre is a partnership with the Highfield Investment Group and will cost more than $120 million. It will be located in the High Plains Industrial Park within Rocky View County and is scheduled to open in the fall of 2021.

“This new distribution centre will allow us to substantially enhance our distribution network capacity and serve our Lowe's and RONA corporate stores and customers, as well as our RONA affiliated dealers, more efficiently throughout Western Canada," said Gregor Stuart, Senior Vice-President, Supply Chain at Lowe's Canada, in a statement.

The retailer said construction of this new distribution centre is beginning this month. Ideally located in the High Plains Industrial Park, it will consolidate the capacity of several existing Lowe's Canada satellite warehouses and regional distribution centres located in the Calgary market, said the retailer. Lowe's Canada's existing distribution centre, located at 2015 60th Street S.E. in Calgary, will not be impacted by this project and will remain in operation.

In a statement, Valérie Gonzalo, spokesperson for Lowe’s Canada, said: “Our future DC in High Plains Industrial Park offers a lot of room to accommodate our large space requirement as well as future expansion capability. From a transportation standpoint, the site offers highly-efficient access to Highway 2 and Stoney Trail. High Plains is ideally located to serve Calgary, Edmonton and many other cities throughout Western Canada. We also appreciated the fact that the 1,100-acre industrial park has been conceptualized with a focus on the environment through an innovative and sophisticated stormwater management system that naturally filters and cleans all stormwater through a series of on-site ponds and wetlands.”

Based in Boucherville, Quebec, Lowe's Canadian business, together with its wholly-owned subsidiary, RONA inc., operates or services more than 470 corporate and independent affiliate dealer stores in a number of complementary formats under different banners. These include Lowe's, RONA, Réno-Dépôt, and Dick's Lumber. In Canada, the companies have more than 26,000 employees, in addition to about 5,000 employees in the stores of independent affiliate dealers operating under the RONA banner.

Adrian Munro, President, Highfield Investment Group, said "High Plains Industrial Park is centre ice for corporate Canada's western distribution centres and e-commerce fulfillment facilities due to its excellent transportation efficiencies, outstanding labour force, and compelling rent economics."

Munro said Rocky View County has become the preeminent location for western Canada distribution centres and ecommerce fulfillment facilities.

"Over the past five years, Highfield has developed, or is developing, nearly five million square feet of industrial space and is home to Sobeys, Lowe’s, Smucker’s, The Home Depot, CHEP, GFS and many others. Highfield has been able to establish High Plains as the ‘centre ice’ location for Corporate Canada due to transportation efficiencies, an outstanding labour force, compelling base rent and real estate tax savings, and best in class facilities designed and constructed by our highly experienced consulting and contractor team. Additionally, Rocky View County welcomes new business and efficiently processes permit applications allowing for expedited development schedules and earlier tenant occupancies."

Marshall Toner, Managing Director and National Lead, Industrial – Canada for commercial real estate firm JLL, who represented Lowe's in the deal, said the Balzac area is an attractive one for big companies.

"First of all, for the deal I just completed there are few places that you could do 70-75 acres of land that could meet the timing," he said.

"I just think with the land pricing and the property tax situation, it's very compelling for companies with a large square footage to give that strong consideration out there."

*INSIDE A LOWE’S DISTRIBUTION CENTRE. PHOTO: LOWE’S*

Michael Kehoe, broker/owner of Fairfield Commercial Real Estate in Calgary, said the Balzc commercial hub has quietly evolved into a significant destination for large-scale business ventures.

"The momentum began 10 years ago with the development of the CrossIron Mills regional shopping centre by Ivanhoe Cambridge. Major logistics facilities such as the New Horizon Mall, a casino and racetrack plus the Amazon distribution centre followed and the momentum continues with the recent Lowe's announcement of a new 1.23 million square foot distribution centre. Balzc enjoys the close proximity to the YYC Calgary International Airport, the Calgary ring road and the Queen Elizabeth Highway #2 highway network. Rocky View County is a development-friendly jurisdiction with a favourable taxation structure that will continue to attract many new large-scale facilities.”

Highfield's portfolio includes High Plains Industrial Park, a 1,100-acre master-planned industrial park and is home to many corporate clients such as GFS, Smucker's, Borger, Sobeys and Penske. High Plains has close to three million square feet since construction began in 2012.

In the last few years, the Balzac area, just north of Calgary city limits, has become a popular spot for the industrial real estate market with the addition of numerous buildings in the distribution and warehouse space. Over the years, companies have set up shop in the area because of its more friendly business environment and reduced costs compared with the City of Calgary.

"Rocky View County is delighted to welcome Lowe's Canada. The County has focused on attracting world-class logistics facilities through strong transportation corridors, competitive taxes, and reasonable regulatory requirements. We know the Lowe's Canada distribution centre will be a great success for the company and the community,” said Reeve Greg Boehlke, Rocky View County councillor.

Alberta Premier Jason Kenney, in a statement, said: "This is great news for Alberta. The construction of the new Lowe's Canada distribution centre will create jobs for Albertans when they are needed most. Once complete, this new facility will employ Albertans for years to come, and demonstrates a vote of confidence in our province's future."

Mario Toneguzzi, based in Calgary has 37 years of experience as a daily newspaper writer, columnist and editor. He worked for 35 years at the Calgary Herald covering sports, crime, politics, health, city and breaking news, and business. For 12 years as a business writer, his main beats were commercial and residential real estate, retail, small business and general economic news. He nows works on his own as a freelance writer and consultant in communications and media relations/training. Email: mdtoneguzzi@gmail.com

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