The area around the future downtown arena is already rising in value according to numbers from the City of Edmonton.
The assessed value of the properties inside the city’s community revitalization zone rose 13 per cent last year, compared to a city-wide average of 3.5 per cent.
The levy allows the city to apply increased tax revenues from higher property assessments to catalyst project designed to encourage development downtown, with the largest project being the new arena.
Coun. Scott McKeen said he isn’t surprised to see the increase, and while it bodes well for the city’s CRL, he always assumed the levy would cover the projects.
“Having studied that CRL fairly extensively, it was pretty clear to me that the city took a very conservative analysis,” he said.
McKeen said he believes some of the growth in value can be attributed to the arena, but generally he believes it’s about a cultural shift.
“We have a generation that is much more interested in living in the urban core, in using public transit, cycling and walking,” he said.
Cory Wosnack, a principal with Avison Young, said much of the CRL boundary area includes top-tier office space, which has seen a steady and consistent increase in rents.
“The buildings right in the core saw the biggest change in the rental rates and that is the driver of the value,” he said.
Wosnack said there have also been several sales of undeveloped land in the core, which also affects the ones that haven’t sold.
“That has increased the perceived value of other land, because of the ones that have sold,” he said.
- The city estimates that over the course of 20 years the CRL will generate an additional $941 million in property taxes.
- The city expects to use $199 million from the CRL to fund a portion of the arena and other surrounding projects.