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ANNUAL EDMONTON OFFICE REPORT Feature Articles Powered By Docstoc
					                             ANNUAL EDMONTON
                                 OFFICE REPORT

                                     Annual Report 2008

Feature Articles
Edmonton:A Look
into the Crystal Ball
Speculation Builders

2500 Scotia Place, Tower 1
10060 Jasper Avenue
Edmonton, AB T5J 3R8

T 780.428.7850
F 780.424.5815

                                          Photo courtesy of Edmonton Tourism

“The face and character of Edmonton are changing. We have become the

epicenter of economic development in Western Canada, the hub of a major
route stretching in four cardinal directions.”
Mayor Stephen Mandel
                                                                                                       Annual Report 2008    14               EDMONTON: A LOOK INTO
                                                                                                                                              THE CRYSTAL BALL

                                                                               FEATURE ARTICLES                             12.0%
                                                                                                                                                 Downtown Vacancy Rate


                                                                               EDMONTON: A LOOK INTO THE CRYSTAL BALL        8.0%
                                                                                                                             6.0%                                              4.9%

                                                                               SPECULATION BUILDERS REWARDED                 4.0%


                                                                                                                                     2003       2004      2005      2006      2007     2008 Q2
                                                                                                                                              Suburban Office District Vacancy

                                                                           1   EXECUTIVE SUMMARY


                                                                                                                                                6.4%      6.4%
                                                                                                                                                                    7.0%       6.8%      6.9%


                                                                               MARK E. ROSE - CEO                            4.0%


                                                                           3   ECONOMIC OVERVIEW                             0.0%
                                                                                                                                    Q1 2007    Q2 2007   Q3 2007   Q4 2007   Q1 2008   Q2 2008

                                                                           6   EDMONTON OFFICE MARKET MAP                    15               MARKET SURVEY Q2-2008

                                                                           7   DOWNTOWN OFFICE SURVEY MAP
                                                                           9   DOWNTOWN BUILDING DETAILS
                                                                          14   EDMONTON: A LOOK INTO THE CRYSTAL BALL
                                                                          15   MARKET SURVEY Q2-2008
                                                                          22   MARKET COMPOSITION
                                                                          23   AVISON YOUNG NOTABLE LEASE TRANSACTIONS
                                                                          24   AVISON YOUNG FEATURE LISTINGS
                                                                          25   SPECULATION BUILDERS REWARDED                 23               AVISON YOUNG NOTABLE
                                                                                                                                              LEASE TRANSACTIONS
                                                                          26   AVISON YOUNG OFFICE TEAM
                                                                          27   CALGARY MARKET GLIMPSE
                                                                          29   EDMONTON EVENTS AND FESTIVALS 2008-2009
                                                                          32   2007 - 2008 HEADLINES
                                                                          33   AVISON YOUNG CLIENTS SERVICES
                                                                          35   INFORMATION SOURCES

          Photo courtesy of Connect 2 Edmonton
                                                                          36   AVISON YOUNG OFFICE LOCATIONS
                                                                                                                             29               EDMONTON EVENTS AND
                                                                                                                                              FESTIVALS 2008-2009
Executive Summary                                                                                                                                   Mark E. Rose - CEO

 Over the past twelve months, Edmontonians have been               only contributing between $25.00 and $30.00 per square
 presented with two very different questions: how have             foot. Tenants, more than ever, need to trust the credibility of
 Edmonton businesses kept up with unsurpassed corporate            their landlord as many of these tenants consider themselves
 growth and are Edmonton businesses witnessing the effects         a quasi-partner in the development. These landlords need to
 of a potentially significant slow down occurring outside of       instill confidence in their tenants and assure them that their
 Alberta borders? A year ago, most Edmontonians would              property is where they should invest their capital dollars and
 have suggested that a moderate slow down of our economic          call home for the forthcoming decade.
 growth would be healthy – as long as it does not last too long.
 “Cautious optimism” has been more than a catch phrase in          The following pages highlight some of the tangible
 the first half of 2008.                                           consequences that many years of momentum in Edmonton’s
                                                                   business community has enabled. It may have been a slow
 Over the past three years, tenants lost most of their             build but Edmonton’s office development community is
 negotiating leverage as vacancies disappeared, rental rates       currently more robust than it has been in 25 years. Last year,
 skyrocketed and landlords maximized the potential of their        our annual report discussed the many new developments on
 full office buildings. For some tenants, leverage will now        the horizon while this year we are analyzing where the office
 begin to swing in their favour. These are tenants who are not     market trends are taking us, who will be successful and why.
 captive and can relocate to another district of the City where
 new inventory is being constructed by developers who are                                                                                             A MESSAGE FROM OUR CEO
 anxious for tenants to ensure a successful investment. The
 variable having the most significant impact on negotiating                                                                                           At Avison Young, we pride ourselves on delivering exceptional service and innovative solutions to all of our clients. As leaders
 new leases is the tenant’s investment in their improvements.                                                                                         in the fields of office, industrial and retail tenant representation, project leasing and management, acquisition, disposition and
 The average cost of improving office space ranges between                                                                                            capital market transactions and comprehensive advisory services to corporations, we are recognized for providing intelligent
 $80.00 and $100.00 per square foot and landlords are typically                                                                                       real estate solutions to meet each client’s distinctive needs.

                                                                                                                                                      Given Edmonton’s unique global position as a manufacturing and logistical hub for the Alberta oil & gas sector, it is no surprise
                                                                                                                                                      that it is also one of our largest and most dynamic Avison Young offices. All across Alberta, vacancy rates are lower than ever
                                                                                                                                                      and investors are capitalizing on the increasing demand for all categories of commercial space in and around the City of Ed-

                                                                                                                                                      We expect Edmonton to continue to be one of the highest growth markets in North America, with excellent long-term opportu-
                                                                                                                                                      nities and profit potential. Our Avison Young professionals in Edmonton stand ready to work with our clients throughout North
                                                                                                                                                      America, are committed to value creation and the provision of integrated solutions for all clients on a global basis.

                                                                                                                                                      Mark Rose
                                                                                                                                                      Chief Executive Officer
                                                                                                                                                      Avison Young

                                                                                      Muttart Conservatory
                                                                                      Photo courtesy of Edmonton Economic Development Corporation

                                                               1                                                                                                                                                    2
Economic Overview                                                                                                                                                      Economic Overview

 Looking back to the beginning of 2007, before the global credit                       from industrial and institutional building applications, which are
 crunch and the US housing meltdown, oil traded for $55.00 a barrel
                                                                                                                                                                                                                                                                            Economic Indicators (Annual % Change)
                                                                                       up 62.1% and 16.4% respectively. Contrast this to a decline in the                Over the past few years, many have considered Alberta to be the
 and the Canadian dollar was worth $0.85 US; Canada’s economy                          value of multi-family permits for the month of May which was down                                                                                                                                            Working Age Population
                                                                                                                                                                         driving force behind Canada’s expanding economy and continues
 was where it wanted to be, with the first quarter of 2007 showing                     15.5% after increasing 31.4% in April.                                                                                                                                                            2006         2007        2008 Q1           2008 Q1
                                                                                                                                                                         to be the case today. Since 1988, Alberta has had the highest                                                                                            (annualized)
 Gross Domestic Product (GDP) from exports up by 0.2% over the                                                                                                           GDP per capita in Canada, which can be largely attributed to the
 previous quarter, along with manufacturing which increased 1.2%                                                                                                                                                                                                             Canada      1.4%         1.4%       8,390,000             1.3%
                                                                                       Upon analyzing another key indicator, namely the Consumer Price                   wealth of resources that are found here. The higher standard of
 after experiencing a decline of 0.7% in the fourth quarter of 2006.                   Index (CPI), we see year-to-date prices in May were up 2.2%. A                                                                                                                        Alberta     4.1%         2.9%        970,000              1.4%
                                                                                                                                                                         living, along with an abundance of opportunity, is drawing people
 Construction also showed a healthy gain of 1.1% over the previous                     large portion of this increase can be contributed to the increase in                                                                                                                  Calgary     4.3%         3.5%        400,000              1.8%
                                                                                                                                                                         to Alberta. During the first quarter of 2008, Alberta posted the
 quarter. These gains were reflected in the total GDP which was up                     energy prices and more specifically gasoline prices, which are up                 largest demographic growth rate in Canada, with the population                                    Edmonton      3.7%         2.8%        280,000              1.3%
 1.0% over the fourth quarter of 2006 and 2.1% year-over-year.                         15.0% year-to-date. The increase in the CPI was somewhat limited,                 increasing by 0.41% to 3,512,400 residents, which is nearly double                                                               Labour Force
 It was during the second half of 2007 that the red flags started to                   partly due to the high value of the Canadian dollar, which resulted               Canada’s population growth rate of 0.24%. As noted in the June 25th                                             2006         2007        2008 Q1            2008 Q1
                                                                                       in a reduction of the cost of some items such as; clothing, fresh                 edition of The Daily, Alberta set new first quarter records, with 5,300                             Canada      1.6%         2.1%       12,580,000            2.9%
          Economic Growth (GDP Annual % Change)                                        fruits and vegetables, and automobiles have all experienced a                     immigrants and a net increase of 4,000 non-permanent residents
                                                                                       decrease in price. When comparing goods to services, year-to-date                                                                                                                     Alberta     4.8%         4.3%       1,610,000             3.3%
                                                                        F      F
                                                                                                                                                                         migrating to Alberta in the first quarter of 2008. At the same time
                    2006            2007          2008 Q1        2008       2009       prices of goods increased 0.7% compared to a 3.7% increase in the                 Alberta manages to have the lowest unemployment rate in Canada                                      Calgary     8.0%         1.7%        540,000              3.2%
                                                                                       cost of services. The largest increases in inflation are being felt in            at 3.6%, which is nearly half of Canada’s average unemployment                                    Edmonton      4.9%         6.7%       1,160,000             8.0%
  Canada            2.7%            2.7%           -0.3%         1.4%       2.4%       Prince Edward Island at 4.1%, Yellowknife at 4.0%, and Alberta and                rate of 6.1%. In May 2008, there were 63,300 more people working                                                                    Employed
  Alberta           6.3%            3.3%            N/A          3.7%       2.9%       Whitehorse which both saw consumer prices increase by 3.7% from                   in Alberta than in May 2007, representing an increase of 3.3%,                                                  2006         2007        2008 Q1            2008 Q1
  Edmonton          5.9%            5.5%            N/A          3.8%       4.0%       a year earlier.                                                                   again the largest growth rate in Canada. As reported in the Alberta
                                                                                                                                                                                                                                                                             Canada      2.1%         2.2%       10,430,000            2.5%
  Economic Indicators: F - Forecast                                                                                                                                      Monthly Economic Overview (June 2008), the largest employment
  Sources: EEDC, AB Employment & Immigration, Statistic Canada                                                                                                                                                                                                               Alberta     5.6%         4.5%       1,070,000             2.3%
  N/A: not available until 2009                                                                                                                                          gains were seen in finance, insurance, real estate and leasing which
                                                                                           Canada’s Q1 2008 Economic Growth by Industry                                                                                                                                      Calgary    10.1%         1.4%        500,000              3.0%
                                                                                                                                                                         saw a total of nearly 20,000 new employees. Looking forward, we
 go up. The value of the Canadian dollar fluctuated between a low                                                    Q1 % Change        Q1 Annualized %                  see increased worldwide oil demand, especially from developing                                    Edmonton      5.7%         6.5%       1,150,000             8.3%
 of $0.93 US to a high of $1.07 US, thus resulting in a dramatic 2.2%                   Goods Producing                   -1.5                  -5.9                     markets such as; China, India, Brazil, Mexico and Russia, combined                                                               Unemployed
 decline in exports. Intuitively, imports soared, increasing by 4.3%                    Industries                                                                       with decreasing worldwide oil supplies will inevitably act to keep                                            2006 (Dec)   2007 (Dec)    2008 Q1            2008 Q1
 in the third quarter and 2.6% in the fourth quarter, mainly due                          Industrial                      -2.1                  -8.1                     oil prices inflated. This will put added importance on Alberta’s oil                                Canada      6.3%         6.0%       2,160,000             6.0%
 to Canadians taking advantage of cheaper goods in the US. The                                                                                                           sands and with that comes added investments, more employment
                                                                                                                                                                                                                                                                             Alberta     3.4%         3.2%        540,000              3.4%
 energy sector also experienced a slow down, showing negative                             Energy Sector                   -0.4                  -1.6                     and increased long term growth. The “Alberta Advantage” is still
                                                                                                                                                                                                                                                                             Calgary     3.4%         2.9%        40,000               3.0%
 growth of 0.1% and 1.0% in the third and fourth quarter of 2007                          Manufacturing                   -3.0                 -11.5                     very much alive in today’s economy and we expect it to stay that
                                                                                                                                                                         way for the foreseeable future.                                                                   Edmonton      3.9%         3.9%        10,000               3.8%
 respectively. The construction industry continued to show growth,                        Non-durable                     -2.1                  -8.1
 partly due to speculators still trying to profit from the real estate                    manufacturing                                                                                                                                                                                                                     Source: Statistics Canada

 boom in the west. Non-residential construction also moved in a                           Durable                         -3.7                 -14.0
                                                                                          manufacturing                                                                            Major Alberta Projects By Region ($ millions)
 positive direction in the fourth quarter, after showing declines in
 the previous two quarters. The Canadian GDP slowed significantly,                        Construction                     0.3                   1.2                                             Alberta                Northern               Edmonton
 with a growth of 0.7% in the third quarter and a mere 0.2% in the                      Service                            0.5                   2.0                                                                    Alberta
                                                                                        Producing Industries                                                                                      # of      Cost         # of        Cost       # of        Cost
 fourth quarter of 2007. Overall, the 2007 year-to-date GDP growth
                                                                                          Wholesale trade                 -0.1                  -0.4                                             Project                Project                Project
 was 2.5% which was slightly lower than 2006 growth of 2.9%.
                                                                                                                                                                          Chemicals & Petro        8        1,176           5         995          2        165
                                                                                          Retail trade                     1.1                   4.5
                                                                                                                                                                          Commercial/Retail       245       16,977         92        3,676        45        2,892
 Seasonally adjusted month-to-month GDP was negative for two                              Transportation &                -0.2                  -0.8
 out of the first four months of 2008. This resulted in an annualized                     warehousing                                                                     Infrastructure          306       16,697        121        5,363        57        2,965

 negative real GDP in the first quarter of 2008 when compared to                          Finance, insurance,              0.7                   2.8                      Institutional           181       10,816         84        3,973        32        2,691
                                                                                          real estate and renting
 fourth quarter 2007. As is pointed out in the June issue of Journal                                                                                                      Oil, Gas, & Oil Sand     64      152,743         55       97,578        12       29,124
 of Commerce, this is the third time in 16 years that the GDP has                         Information &                    0.1                   0.4
                                                                                                                                                                          Pipelines                35       8,696          22        3,897         6        2,097
 had negative growth on a quarter-to-quarter annualized basis.                            technologies                                                                    Power                    11        149           11         293          5        114
 Construction of both residential and non-residential buildings                                                                            Source: Statistics Canada      Tourism/                111       7,560          45        2,783        22        733
 decreased in April for the second consecutive month, slowing by                                                                                                          Recreation
 0.2% in March and 0.7% in April. This is set to change as the value                                                                                                      Other                    85       13,020         16        1,263         6        313
 of non-residential building permits increased by 27.8% in April                                                                                                          TOTAL                   1,046    $227,834       451      $119,821      187      $41,124
 and 12.8% in May. The largest portion of the growth in May comes                                                                                                                                                  Source: Edmonton Economic Development Corporation                                             Photo courtesy of Edmonton Tourism

                                                                                                                                                                                                                                                                                                                     Photo courtesy of Avison Young
                                                                                   3                                                                                                                                                                                   4
Economic Overview                                                                                                                                                                     Edmonton Office Market Map

  Edmonton continues to do exceptionally well, with GDP growth
  of 5.5% in 2007 and the Edmonton Economic Development Cor-
  poration (EEDC) forecasting growth of 5.5% for the remainder
  of 2008. Much of this increase is a spinoff from the energy sec-
  tor, which continues to lure people from all over Canada and the
  world with the promise of high incomes and a better quality of

  Photo courtesy of Edmonton Tourism                                                                                                            Photo courtesy of Edmonton Tourism

  life. There is an estimated $150 billion of planned oil and gas proj-
  ects in Northern Alberta and Edmonton is uniquely positioned to
                                                                                                                 Local vs. National GDP Growth Rate
  benefit from these long term investments. Other factors contrib-
  uting to Edmonton’s growth include increased construction activ-
                                                                           Annual Average Growth

  ity, high rate of consumer spending and increased investments                                    5.0%

  in oil and gas servicing companies. The most significant of these                                4.0%
  servicing companies are engineering and surveying related. With                                  3.0%
  substantial growth taking place in these industries, much of the                                 2.0%
  new office space coming online is being quickly absorbed. All
  three levels of government are also very active in Edmonton right
  now with each of the Federal, Provincial, and Municipal levels in                                0.0%
                                                                                                          2004     2005   2006   2007 2008f 2009f 2010f 2011f 2012f
  the market for significant pockets of office space. Second quarter
  non-residential construction increased 10.3% year-to-date and                                                            Edmonton    Canada
  building permits in Edmonton increased by 21.4% between May
                                                                                                                                                           Source: City of Edmonton
  2007 and May 2008, an indication that Edmonton’s construction
  boom is far from over. This should lead to increases in employ-
  ment, wages and a continuous demand for commercial real es-
  tate across all sectors. Edmonton currently has one of the hottest
  economies in the world and we expect to see excellent long term
  growth in this region for some time to come.
                                                                          “Edmonton is strategically placed to benefit
                                                                          from $200 billion worth of major projects in
                                                                          Northern Alberta.”

                                                                                                          - Edmonton Economic Development Corporation

                                                                      5                                                                                                                                            6
Downtown Office Survey Map       Downtown Office Survey Map

                             7                                8
             Downtown Building Details                                                                                                Downtown Building Details
                                                                                                                                                     Phipps McKinnon                   Standard Life Centre                 Sun Life Place


             1                      Bell Tower      2               Canada Place        3                   City Hall                 18                                     19                                20
                           10104 - 103 Avenue                  9700 Jasper Avenue                      1 Sir Winston                                           Building                 10405 Jasper Avenue               10123 - 99 Street
                                                                                                                                                   10020 - 101A Avenue
                        Office area: 419,770                 Office area: 745,595            Office area:      48,467                            Office area: 202,375              Office area: 381,068             Office area: 276,065
                        Floorplate:     14,704               Floorplate:    49,706           Floorplate:          N/A                            Floorplate:     11,202            Floorplate:      21,000          Floorplate:     10,975
                        Vacancy:          2.5%               Vacancy:         0.0%           Vacancy:           0.0%                             Vacancy:         5.9%             Vacancy:           0.0%          Vacancy:         1.4%
                        Year Built:       1982               Year Built:      1988           Year Built:        1992                             Year Built:      1977             Year Built:        1980          Year Built:      1977
                        Landlord:       Oxford               Landlord: Government            Landlord:         City of                           Landlord: The Canapen             Landlord:      Standard          Landlord:     Sun Life
                              Properties Group                           of Canada                          Edmonton                                             Group             Life Assurance Company             Assurance Company
                                                                                                                                                                                                                                of Canada
                             Commerce Place                     Edmonton Journal                    Manulife Place
                                                                                                                          A                         Telus Plaza North                         Telus House
             4                                      5                                   6                                             21                                     22
                             10155 - 102 Street                            Building               10180 - 101 Street                              10025 Jasper Avenue                     10020 - 100 Street
                                                                  10006 - 101 Street
                        Office area: 606,956                 Office area: 130,000            Office area:     744,707                            Office area: 716,759              Office area: 420,485
                        Floorplate:   24,618                 Floorplate:    28,000           Floorplate:        22,000                           Floorplate:    23,700             Floorplate:    18,600
                        Vacancy:       3.4%                  Vacancy:          0.0%          Vacancy:            3.1%                            Vacancy:         0.0%             Vacancy:         0.7%
AA                      Year Built:    1990                  Year Built:      1990           Year Built:         1983                            Year Built:      1970             Year Built:      1971
                        Landlord: GWL Realty                 Landlord: Edmonton              Landlord:        Manulife                           Landlord: Tonko Realty            Landlord: Tonko Realty
                                     Advisors                               Journal                           Financial                                        Advisors                          Advisors

             7                   Scotia Place       8                     TD Tower                                                                     100 Street Place      24        102nd Street Centre     25   A.D. Williams Building
                         10060 Jasper Avenue                    10088 - 102 Avenue                                                                    10150 - 100 Street                 10150 - 102 Street              10010 - 100Street

                        Office area: 531,375                 Office area: 333,529                                                                Office area:  44,649              Office area:    133,038          Office area:   16,233
                        Floorplate:    11,000                Floorplate:     14,180                                                              Floorplate:    5,200              Floorplate:         N/A          Floorplate:     8,115
                        Vacancy:         6.1%                Vacancy:          6.4%                                                              Vacancy:       7.8%               Vacancy:           0.0%          Vacancy:         0.0%
                        Year Built:      1981                Year Built:       1976                                                              Year Built:    1970               Year Built:        1983          Year Built:      1971
                        Landlord: Morguard                   Landlord:       Oxford                                                              Landlord:    Melcor               Landlord:       Manulife         Landlord: Tonko Realty
                                Investment Ltd.                    Properties Group                                                                  Developments Ltd.                             Financial                      Advisors

                                   ATB Tower        10            Bank of Montreal               Canadian Western                     26                  ATCO Centre        27                   CN Tower     28       Empire Building
                           9888 Jasper Avenue                               Building                     Bank Place                                   10035 - 105 Street                10004 - 104 Avenue           10080 Jasper Avenue
                                                                  10199 - 101 Street           10303 Jasper Avenue
                        Office area: 168,000                 Office area: 126,899            Office area: 336,995                                Office area: 285,550              Office area: 246,255             Office area: 107,526
                        Floorplate:   10,700                 Floorplate:     20,000          Floorplate:     13,900                              Floorplate:    14,947             Floorplate:    11,948            Floorplate:     9,200
                        Vacancy:       0.0%                  Vacancy:          0.0%          Vacancy:          0.3%                              Vacancy:         0.0%             Vacancy:        10.7%            Vacancy:         1.8%
                        Year Built:    1979                  Year Built:       1985          Year Built:       1981                              Year Built:      1982             Year Built:      1967            Year Built:      1962
                        Landlord: JEH Corp.                  Landlord:        Realex         Landlord: Brookfield                                Landlord:       EDCAL             Landlord:    Kingsway            Landlord:     Emperor
                                                                        WoodBourne                        Properties                                (2002) Holdings Ltd.               Asset Management                  Property Holdings
                                                                         Properties 1
                                     Cecil Place                 City Centre Place                 Enbridge Tower
                                                                                                                          B                                EPCOR Tower               Manhattan Building                 Melton Building
             12                                     13                                  14                                            29                                     30                                31
                          10404 Jasper Avenue                 10025 - 102A Avenue              10201 Jasper Avenue                                 10065 Jasper Avenue                10345 - 105 Avenue             10310 Jasper Avenue
                        Office area:     43,000                                                                                                  Office area: 156,397              Office area:    23,688
                        Floorplate:      21,500              Office area: 223,991            Office area: 182,476                                Floorplate:      10,115           Floorplate:     11,844           Office area: 112,933
                        Vacancy:          97.7%              Floorplate:     11,213          Floorplate:     9,062                               Vacancy:          0.0%            Vacancy:        48.2%            Floorplate:   13,000
                        Year Built:        2008              Vacancy:          7.4%          Vacancy:         0.0%                               Year Built:       1976            Year Built:      1950            Vacancy:       6.0%
A                       Landlord:       1193402              Year Built:       1974          Year Built:      1981
                                                                                                                                                 Landlord: GE Canada
                                                                                                                                                                                   Landlord:         River          Year Built:    1970
                                                             Landlord:       Oxford                                                                  Real Estate Holding                    City Imperium           Landlord:     Melcor
                                     Alberta Ltd.                                            Landlord: Brookfield                                              Company
                                                                   Properties Group                      Properties                                                                         Developments                Developments Ltd.

             15         HSBC Bank of Canada         16                ING Building                   Oxford Tower                     32               Milner Building       33        Royal Bank Building     34                Scotia 3
                                      Building                    10130 - 103 Street              10235 - 101 Street                                  10040 - 104 Street               10117 Jasper Avenue           10072 Jasper Avenue
                             10250 - 101 Street
                        Office area: 242,886                 Office area: 258,287            Office area: 320,521                                Office area: 160,563              Office area:  96,490             Office area:    26,489
                        Floorplate:     15,171               Floorplate:     11,811          Floorplate:     13,610                              Floorplate:     13,500            Floorplate:    7,950             Floorplate:       4,349
                        Vacancy:          4.0%               Vacancy:          1.3%          Vacancy:          5.9%                              Vacancy:           0.0%           Vacancy:       1.9%              Vacancy:         13.7%
                        Year Built:      1980                Year Built:       1981          Year Built:       1978                              Year Built:        1959           Year Built:    1965              Year Built:       1981
                        Landlord:       Aspen                Landlord:        Aspen          Landlord:       Oxford                              Landlord:           Slate         Landlord:    Melcor              Landlord:       Martin
                                Properties Ltd.                       Properties Ltd.              Properties Group                                        Properties Inc.             Developments Ltd.             G.Schultz Professional

                                                         9                                                                                                                        10
             Downtown Building Details                                                                                               Downtown Building Details

             35             Swedish Jewellers       36       World Trade Centre                                                      52                HSBC Building       53               Park Plaza      54    Peace Hills Insurance
                                       Building              9990 Jasper Avenue                                                                      10055 - 106 Street              10611 - 98 Avenue                         Building
                             10169 - 101 Street           Office area:    56,000                                                                                                                                   10709 Jasper Avenue
                        Office area:     16,800                                                                                                 Office area: 114,092             Office area: 130,227            Office area:    73,366
                                                          Floorplate:      7,200
                        Floorplate:        4,200                                                                                                Floorplate:    10,600            Floorplate:    14,560           Floorplate:     13,048
                                                          Vacancy:         0.0%
                        Vacancy:          25.0%                                                                                                 Vacancy:          2.0%           Vacancy:         0.0%           Vacancy:          0.0%
B                       Year Built:        1936
                                                          Year Built:       1951                                        A                       Year Built:       1974           Year Built:      1985           Year Built:       1980
                                                          Landlord: Edmonton                                                                                                                                     Landlord:          PHI
                        Landlord:        934252                                                                                                 Landlord:         Slate          Landlord:      August
                                                                        Chamber                                                                          Properties Inc.              Domain Park Plaza                       Properties
                                     Alberta Ltd.                   of Commerce

                         Alano Club Building        38             Beaver House      39           Birks Building                     55         Peace Hills Trust Tower    56         Petroleum Plaza       57
                                                                                                                                                                                                                        Stantec Centre
                             9929 - 103 Street                  10158 - 103 Street             10113 - 104 Street                                   10011 -109 Street                 9945 - 108 Street               10160 - 112 Street

                        Office area:    10,500            Office area:    65,229          Office area:  35,558                                  Office area: 139,953             Office area: 286,253            Office area: 180,000
                        Floorplate:      3,500            Floorplate:     13,045          Floorplate:    8,000                                  Floorplate:    12,750            Floorplate:    12,128           Floorplate:      27,000
                        Vacancy:         100%             Vacancy:         100%           Vacancy:      24.8%                                   Vacancy:         0.0%            Vacancy:         0.0%           Vacancy:           0.0%
                        Year Built:       1991            Year Built:       1925          Year Built:    1929                                   Year Built:      1982            Year Built:      1973           Year Built:        2001
                        Landlord: Sedona Keys             Landlord: Onni Group            Landlord:    Melcor                                   Landlord: Tonko Realty           Landlord: Morguard              Landlord: Blackwood
                                  Developments                      of Companies              Developments Ltd.                                               Advisors                  Investments Ltd.                     Partners Inc.

             40                    Boardwalk        41          Canadian Direct      42            CIBC Building                     58
                                                                                                                                                        Sterling Place
                           10310 - 102 Avenue                Insurance Building             10102 Jasper Avenue                                       9940 - 106 Street
                                                             10115 - 100 A Street         Office area:     18,000
                        Office area: 105,335              Office area:    41,700          Floorplate:       4,500                               Office area: 169,500
                        Floorplate:    24,957             Floorplate:      6,500          Vacancy:          0.0%                                Floorplate:   14,515
C                       Vacancy:          6.6%            Vacancy:        43.6%           Year Built:         N/A                               Vacancy:        0.0%
                        Year Built:       1908            Year Built:      1974           Landlord: Canadian                                    Year Built:     1982
                        Landlord:         Slate           Landlord: Onni Group                   Imperial Bank of                               Landlord: GWL Realty
                                 Properties Inc.                    of Companies                       Commerce                                              Advisors

                        Confederation Building               MacDonald Estates       45        Revillon Building                                  108 Street Building                    Baker Centre       61   Capital Health Centre
             43                                     44                                                                               59                                    60
                         10355 Jasper Avenue                 9939 Jasper Avenue                10201 - 104 Street                                    9942 - 108 Street                10025 - 106 Street             10030 - 107 Street
                                                          Office area:     20,592
                        Office area:    24,340            Floorplate:        5,148        Office area: 111,764          B                       Office area: 156,500             Office area: 123,271            Office area:    313,211
                        Floorplate:      6,600            Vacancy:          11.4%         Floorplate:      17,134                               Floorplate:   14,451             Floorplate:     10,500          Floorplate:      13,055
                        Vacancy:          0.0%            Year Built:        1973         Vacancy:         17.1%                                Vacancy:        0.0%             Vacancy:          5.6%          Vacancy:           0.0%
                        Year Built:       1965            Landlord:        LaSalle        Year Built:        1912                               Year Built:     1976             Year Built:       1966          Year Built:        1977
                        Landlord:         Valpy                        Investment         Landlord:           Slate                             Landlord: GWL Realty             Landlord:         Slate         Landlord:        Capital
                                    Corporation                     Management                       Properties Inc.                                         Advisors                     Properties Inc.                         Health

             46         44 Capital Boulevard        47             9925 Building     48               Associated                     62                Energy Square       63        Forestry Building      64            Harley Court
                            10044 - 108 Street                   9925 - 109 Street            Engineering Plaza                                      10109 - 106 Street               9920 - 108 Street               10045 - 111 Street
                                                                                            10909 Jasper Avenue
                        Office area:   383,591            Office area: 227,277            Office area: 162,624                                  Office area: 116,598             Office area: 129,500            Office area: 135,543
                        Floorplate:     30,348            Floorplate:    19,300           Floorplate:     14,185                                Floorplate:    10,866            Floorplate:   13,530            Floorplate:     11,839
                        Vacancy:          0.0%            Vacancy:        1.7%            Vacancy:          0.0%                                Vacancy:        0.6%             Vacancy:       0.0%             Vacancy:          9.4%
                        Year Built:       1983            Year Built:     1977            Year Built:       1978                                Year Built:     1979             Year Built:    1981             Year Built:       1978
                          Landlord:    Dundee             Landlord: Tonko Realty          Landlord: Procura Real                                Landlord:      Qualico           Landlord: GWL Realty            Landlord:     Strategic
                                         Realty                         Advisors                           Estate                                        Developments                         Advisors                     Equity Group

             49                  Capital Place      50         Devonian Building     51   First Edmonton Place                       65
                                                                                                                                                       Highfield Place     66    Ironwood Professional      67        Labour Building
                              9707 - 110 Street               11160 Jasper Avenue          10665 Jasper Avenue                                       10010 - 106 Street                           Centre             10808 - 99 Avenue
                                                                                                                                                                                      10050 - 112 Street
A                       Office area: 132,277              Office area: 159,175            Office area:      225,855                             Office area: 101,553             Office area:    80,573          Office area:  90,324
                        Floorplate:      16,045           Floorplate:   11,000            Floorplate:        15,200                             Floorplate:    10,460            Floorplate:     10,695          Floorplate:    9,000
                        Vacancy:          0.0%            Vacancy:       100%             Vacancy:             6.6%                             Vacancy:          0.0%           Vacancy:          6.9%          Vacancy:       0.0%
                        Year Built:       1980            Year Built:     1978            Year Built:          1983                             Year Built:       1977           Year Built:       1974          Year Built:    1968
                        Landlord: Paramount               Landlord:    Canterra           Landlord:          954470                             Landlord:         Slate          Landlord: Ironwood              Landlord: GWL Realty
                                    Investments             Developments Corp.                           Alberta Ltd.                                    Properties Inc.                      Assets Inc.                     Advisors

                                                         11                                                                                                                     12
             Downtown Building Details                                                                                                   Edmonton: A Look into the Crystal Ball

             68                     Oxbridge Place       69                  University of                                                 While we can all agree that it was nearly two decades of          Centrally, the developments that will prove most economi-
                                   9820 - 106 Street                  Lethbridge Building                                                  hardship for Edmonton landlords whereby virtually no profit       cal are redevelopments of aged buildings that have lost their
                                                                       10707 - 100 Avenue                                                  was earned from owning office buildings, the past five years      functionality due to change in use, inefficiencies or loss of
                             Office area: 190,628
                             Floorplate:     13,616                Office area:    87,529                                                  have proven to be tremendously rewarding. So rewarding in         architectural appeal. Outside of the central business district,
                             Vacancy:         0.0%                 Floorplate:      6,552                                                  fact, few markets in all of Canada can compare with the rate      there still remains attractive opportunities for credible de-
                             Year Built:      1976                 Vacancy:         1.5%                                                   of return for those who owned Edmonton office real estate         velopers to construct mid-size office buildings in easily ac-
B                            Landlord: London Life                 Year Built:      1979
                                                                                                                                           in 2003 and still own it today. The question is, where does       cessible locations; likely to consist of 60,000 square feet or
                                          Insurance                Landlord:      Keywest
                                                                                   Capital                                                 the market go from here?                                          less.

             70                105 Street Building       71           Blue Cross Building     72                   Blue Cross Place        What we do know is that there is no end in sight for Edmon-       Many of Edmonton’s office tenants were quick to take ad-
                                 10242 - 105 Street                     10025 - 108 Street                        10009 - 108 Street       ton’s continued urban sprawl. Shortly, we will see dirt mov-      vantage of great value opportunities in the “flight to qual-
                             Office area:      85,024              Office area:   33,000                     Office area:    89,015        ing for new office buildings west of 180th Street, south of       ity” era of the mid to late 90’s when companies flocked to
                             Floorplate:       10,187              Floorplate:      6,667                    Floorplate:     10,475        Ellerslie Road, east of 34th Street and even on a golf course.    downtown to locate in the City’s best buildings for the same
                             Vacancy:            0.0%              Vacancy:         0.0%                     Vacancy:          0.0%        Thanks to Anthony Henday Drive, not only will we see com-         rent they would pay in a much lower quality building away
                             Year Built:         1980              Year Built:      1956                     Year Built:       1975        panies relocating to opposite regions of the City without         from downtown. A reverse ideology will prevail in tomor-
                             Landlord:          Redev              Landlord: ABC Benefits                    Landlord: ABC Benefits        much resistance from staff or customers but we will see one       row’s office market as some tenants will relocate outside of
                                            Properties                         Coporation                                Corporation
                                                                                                                                           of the most impressive developments in Edmonton, the Cur-         downtown to take advantage of lower rental rates or move
                                                                                                                                           rents of Windermere, combine retail, office and residential       into newly constructed office buildings with more abundant
             73                       Centre West                        Commonwealth                         Dorchester Building
C                                                        74                                   75                                           in a market that never existed prior to the extension of An-      and affordable parking, modern architecture and an oppor-
                                  10035 -108 Street                               Building                      10357 - 109 Street
                                                                         9912 - 106 Street
                                                                                                                                           thony Henday Drive.                                               tunity to be the dominant tenant in a building rather than be
                             Office area: 137,095                                                            Office area:      42,000                                                                        one of many in a high-rise tower. The value of a dollar may
                                                                   Office area:     34,857
                             Floorplate:    14,541                                                           Floorplate:       12,000      What we do not know is whether we will see a third an-            ultimately be the guiding principle in a tenant’s real estate
                                                                   Floorplate:        6,592
                             Vacancy:        0.0%                                                            Vacancy:            0.0%      nouncement for a new high rise office tower in downtown           decision.
                                                                   Vacancy:          11.9%
                             Year Built:     1976                                                            Year Built:         1911
                                                                   Year Built:        1965                                                 Edmonton during this economic cycle. Other than the new
                             Landlord:      Qualico                                                          Landlord:            Yale
                                                                   Landlord:       Gold Bar                                                EPCOR Tower currently under construction north of 104th
                                      Developments                             Investments                                  Properties
                                                                                                                                           Avenue and east of 101st Street and the recent pre-sales ini-
                                                                                                                                           tiative by Ironwood for their office condo project on 103rd
             76                 Financial Building                          Fun Sun Place     78
                                                                                                              Jack Bredin Building
                                                                                                                 10010 - 105 Street        Street and 102nd Avenue, we may be a long way from see-
                                10621 - 100 Avenue                       10232 - 112 Street
                                                                                                                                           ing another announcement. Much to the chagrin of tenants
                             Office area: 136,493                  Office area:    26,000                    Office area:  32,763          in the rental rate leading financial core, there needs to be
                             Floorplate:    12,400                 Floorplate:      6,200                    Floorplate:   12,000          a further increase in rental rates combined with a 100,000          Currents of Windermere
                             Vacancy:         0.7%                 Vacancy:         0.0%                     Vacancy:        0.0%          square foot space requirement to inspire a new tower. While
                             Year Built:      1957                 Year Built:      1977                     Year Built:     1952
                                                                                                                                           trades may be more available now than in recent years, most
                             Landlord: Stromiga Inc.               Landlord: Bruinsma                        Landlord: Edmonton
                                                                             Holdings Ltd.                     John Howard Society         construction costs have remained high. Those developers
                                                                                                                                           who acquired their land prior to 2005 have a cost advantage
                                    Jarvis Building
                                                                                                                                           to those who are attempting to secure a land position at this
             79                                          80              Notlem Building
                                   9925 - 107 Street                     10018 - 106 Street                                                time. We are now at a critical phase for land holders who will
                                                                                                                                           find their audience of purchasers dwindling quickly. While
                             Office area: 104,762                  Office area:     27,000                                                 new residential developments have a broader opportunity
                             Floorplate:   10,000                  Floorplate:         N/A                                                 to locate on a variety of central sites, new office develop-
                             Vacancy:       0.0%                   Vacancy:           0.0%                                                 ments do not have that luxury.
                             Year Built:    1974                   Year Built:         N/A
                             Landlord:    Workers                  Landlord: Frank Cairo
                               Compensation Board                               Enterprises                                                The risk that exists today is that many land owners have
                                                                                                                                           been waiting for higher and higher prices per square foot,
                                                                                                                                           currently reaching levels not seen since 1981. They now face
                                                                                                                                           a market where multi-family residential may be on the verge
             “We all believe downtown has to project what is best about Edmonton. We all know that in any great                            of being over supplied and the market is not presently ready
             city - downtown is where you find its heart. It’s a showpiece. It’s a magnet. A city lives in its down-                       for another high-rise office development. The prices for cen-
             town.”                                                                                                                        trally located land today do not justify a low-rise develop-
                                                                                                                                           ment and unfortunately shut out many of the new retailers
                                                                                                                                           that are interested in a downtown Edmonton location.                                                        Photo courtesy of Avison Young
                                                              - Mayor Stephen Mandel addressing the Downtown Business Association

                                                                 13                                                                                                                                     14
                    Market Survey Q2-2008                                                                                                                                                                                                      Market Survey Q2-2008

                     Downtown Office District - Vacancy 4.5%                                                                                                                                                                                      Downtown Financial District – Vacancy 4.2%
Downtown District

                                                                                                                                                                                                                          Downtown Financial
                                                                                                                                                  Downtown Vacancy Rate                                                                                                                                                                  Downtown Financial District Vacancy by Class Q2 2008
                     Edmonton’s downtown market is split into two separate sections;          12.0%                                                                                                                                              The Financial District, once again, is showing positive gains in the
                     Government and Financial Districts. The Financial District is located    10.0%
                                                                                                                                                                                                                                                 first half of 2008. This year has seen vacancy levels drop by 0.6% and     Total                  4.1%

                     between 97th Street and 105 Street and covers 98 Avenue north to                                                         7.7%
                                                                                                                                                                                                                                                 have decreased 5.5% since 2003. This downward trend is forecasted
                                                                                                 8.0%                                                                                                                                            to continue as Edmonton’s Financial District vacancy rate decreases          AA               3.0%
                     104 Avenue while the Government Districts borders the Financial                                                                           6.3%
                     Districts west of 105 Street to 113 Street, using the same north and        6.0%
                                                                                                                                                                                                                                                 due to the expansion of existing tenants and the entering of new
                                                                                                                                                                                                           4.5%                                                                                                                A              2.8%
                     south borders as the Financial District.                                                                                                                                                                                    companies into Alberta’s fast paced economy. This district holds a
                                                                                                                                                                                                                                                 total of over 9.3 million square feet.                                         B                 3.3%
                     The Downtown District (Financial and Government) vacancy rate               2.0%

                     has decreased slightly by 0.4%, year-to-date, to 4.5% which can                                                                                                                                                             Since mid-year 2007, Avison Young has added the A.D. Williams                  C                                                                            30.3%
                     be attributed to a spillover effect from both the downturn in the                                     2003              2004          2005               2006           2007       2008 Q2
                                                                                                                                                                                                                                                 Building, Alano Club Building, Beaver House, Cecil Place, Manhattan
                     global credit market as well as the economic turmoil that is being                                                                                                                                                          Building and the Swedish Jewellers Building to our survey of                       0.0%          5.0%      10.0%     15.0%      20.0%      25.0%        30.0%   35.0%

                     experienced in the US. When comparing this quarter’s vacancy to                                                                                                                                                             Financial District buildings. Combined, these buildings add over
                     the 10 year historical vacancy rate we see that it has decreased by                                                                                                                                                         175,000 square feet of office space to our survey, providing a better
                                                                                                                                                  Edmonton Net Migration
                     more than 11 percentage points from 15.7% to its current rate of                                                                                                                                                            overall picture of the market.
                                                                                                                  25                                                                                                                                                                                                        12.0%                    Downtown Financial District Vacancy
                     4.5%. Considering the current conditions surrounding the price                                                                       22.5                                      22.5      22.5
                                                                                                                                                                                                                                                 Rental rates have increased for every class of building in the                            9.7%
                     of oil and the Edmonton region’s strategic position we expect a                              20                                19                              19       19                                                                                                                             10.0%
                     downward trend in the downtown office vacancy rate to continue                                                                                    16.5                                                                      Financial District. Class A buildings have seen the greatest increase

                                                                                               Population (000)
                                                                                                                                      14.5                                                                                                                                                                                   8.0%
                     over the long run.                                                                           15                                                                                                                             posting a 30.0% rental rate escalation from an average of $23.00 per
                                                                                                                                                                                                                                                 square foot from the second quarter of 2007 to a current average            6.0%
                                                                                                                  10                                                                                                                             of $30.00 per square foot in the second quarter of 2008. Class AA                                                                       4.8%
                     2008 Forecast

                                                                                                                            6.5                                                                                                                                                                                                                                                                      4.2%
                                                                                                                                                                                                                                                 and B withnessed rental increases of 20.0%. These increases can             4.0%
                                                                                                                                                                                                                                                 be attributed to the limited supply of space and a continuous and
                     Economic activity in 2008 is expected to grow at a more moderate                                                                                                                                                            increasing demand.                                                          2.0%
                     rate, 3.7% for Alberta and 3.8% for the Edmonton Region. Alberta’s
                                                                                                                           2004       2005         2006   2007         2008     2009f 2010f 2011f 2012f                                                                                                                      0.0%
                     new royalty tax regime is expected to squeeze an additional 1.4                                                                                                                                                             The Edmonton markets, more specifically the downtown markets,                             2003          2004       2005       2006      2007       Q2 08
                     billion dollars annually out of oil and gas company profits starting                                                                                            Source: Conference Board of Canada
                                                                                                                                                                                                                                                 are troubled by what is known as fragmented space. Fragmented
                     in 2009 and will have an impact on oil and gas sector investment in                                                          GDP Growth by Industry                                                                         space can be defined as having space available but not all in one
                     2008. However, we expect continued growth in business investment,                                                                  2001-2006                                                                                location; it is spread out among multiple buildings throughout the
                     consumer spending, government spending on infrastructure and                                                                                                                                                                district. Having this setback creates difficulties when companies are                            Downtown Financial District Absorption
                     net-migration into Alberta to continue at healthy historic averages.                              Manufacturing                           10.8%
                                                                                                                                                                                                                                                 expanding operations and it makes for a very tight market which            120,000
                     With strong net-migration, businesses will continue to expand and                                      Construction                                                                   60.0%                                                                                                                                          102,140
                                                                                                   Transportation & Comm
                                                                                                                                                                                                                                                 inevitably increases rental rates.                                         100,000
                     require more space to accommodate new employees. We expect
                                                                                               Wholesale & Retail Trade                                                                     42.5%
                     vacancy across all markets in the Edmonton Region to remain                                                                                                                                                                 Of note, Class C vacancy is quite high at 30.3% but when considering
                                                                                                                                           FIRE                       18.7%                                                                                                                                                                  55,990
                     below natural rates (defined by economists as the stock of available                                                                                                                                                        last year’s 25.8% level, the year-over-year increase is moderate due to     60,000
                                                                                                                  Commercial Services                                 17.8%
                     space required to facilitate the search requirements of tenants                                                                                                                                                             its small inventory. The main reason behind the increase is the new         40,000                                                                         33,088
                                                                                              Non-Commercial Services                                     9.2%
                     and the search needs of landlords). With low vacancies, net rental                                                                                                                                                          additions of the Alano Club and Beaver House to our survey. Both
                                                                                                                            Public Admin                                22.1%                                                                                                                                                20,000
                     rates will be very responsive to any continued increase in demand.                                                                                                                                                          are Class C buildings and add over 75,000 square feet of inventory

                     With little new office space expected to be constructed in 2008 in                                                        0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%                                                                                                                                        0
                                                                                                                                                                                                                                                 to the market. Currently, each building is empty contributing to the                                                                           -2,742
                     the Downtown District, we expect the vacancy rate to drop below                                                                                                 Source: Conference Board of Canada                          4.5% increase in Class C building vacancy.                                  -20,000                                              -11,084
                     4.0%. This may push net rental rates for Class AA towards $40.00 per                                                                                                                                                                                                                                                    Q1 07         Q2 07       Q3 07       Q4 07        Q1 08        Q2 08

                     square foot at the end of a longer term lease. As a result, this will                                                   10 Year Office Market Forecast
                                                                                              20.0%                                                                                                                                              Since the end of last year there has been positive absorption of
                     force tenants to look at alternatives in the Suburban District where     18.0%                                                                                                                                              space through company expansions and the entering of new
                     the completion of three new office buildings will add 230,000            16.0%
                                                                                                                   15.7%                                                                                   Vacancy
                                                                                                                                                                                                                                                 businesses into the district. Edmonton’s downtown Financial
                     square feet of office space to the market in 2008. The adjacent 10                                    13.6%
                                                                                                                                                                                                                                                                                                                                                    Downtown Financial District
                                                                                                                                                                                                                                                 District will continue to be very tight until the EPCOR Tower comes
                     year Office Market Forecast has been prepared by the Avison Young        12.0%                                        10.8% 11.1% 10.9%
                                                                                                                                                                                                                                                 online in 2012 which will add 614,000 square feet to Edmonton’s                                  Class              Net Rental Rate
                     Research Team.                                                           10.0%
                                                                                                                                                               8.3%                                                                              office inventory. To date, approximately 50% of the building is                                                          ($ PSF)
                                                                                                                                                                                           4.5%                                                  already pre - leased to EPCOR.                                                                   AA                     34 to 36
                     The forecast shown represents the most likely scenario (Base Case
                     Scenario) given historic and forecasted economic growth rates for         2.0%
                                                                                                                                                                                                                                                                                                                                                   A                     28 to 32
                     the Edmonton Region.                                                      0.0%
                                                                                                                   1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2008 2009 2010
                                                                                                                                                                                                                                                                                                                                                    B                    17 to 25
                                                                                                                                                                                                                                                                                                                                                   C                     15 to 20

                                                                                         15                                                                                                                                                                                                                            16
                      Market Survey Q2-2008                                                                                                                                                                                 Market Survey Q2-2008

                                                                                                                              Downtown Government District -Vacancy 5.1%
Downtown Government

                                                                                                                                                                                                        Suburban District
                                                                                                                                                                                                                             Suburban Office District - Vacancy 6.9%                                                                        Suburban Office District Vacancy
                                                    Downtown Government District Vacancy by Class                                                                                                                                                                                                          10.0%

                                                                    Q2 2008                                                   Vacancy levels declined by 0.6% to 5.1% since the end of the fourth                            The vacancy level for the first half of 2008 decreased to 6.9%, down                                8.1%
                                                                                                                                                                                                                                                                                                              8.0%                                                             7.0%
                                                                                                                              quarter 2007 and have dropped by 6.4% since 2003. Additionally,                                0.1% from the same time last year. Between the fourth quarter of 2007                                               6.4%         6.4%
                                                                                                                                                                                                                                                                                                                                                                                              6.8%       6.9%

                                         Total                                                     5.1%                       year-over-year vacancy rates for each district are on a downward                               and the first quarter of 2008 any large amounts of space to become               6.0%

                                                                                                                              spiral declining a full percentage point per annum. The Government                             available in the Suburban Districts have been quickly absorbed. This             4.0%
                                            A                                                                     7.6%        District has also been affected by the increase in rental rates across                         absorption of large blocks of space signals that Edmonton’s suburban

                                                                                                                              all building classes and the percentage increases have been similar                            office space is still in high demand.
                                                B                          2.6%                                               to the Financial District.                                                                                                                                                      0.0%
                                                                                                                                                                                                                                                                                                                               Q1 2007      Q2 2007        Q3 2007         Q4 2007        Q1 2008       Q2 2008
                                                                                                                                                                                                                             Since mid-year 2007, Avison Young has expanded its survey to
                                                C                        2.3%                                                 This market has a total of over 4.5 million square feet of office space                        include additional buildings increasing the inventory of the Suburban
                                                                                                                              with 235,471 square feet of available head lease space and virtually                           District by almost 1,000,000 square feet. This market, as a whole,                                           Suburban Office District Apsorption
                                                 0.0%            2.0%               4.0%              6.0%        8.0%        no sublease space. At the same time last year, there was 282,000                               contains approximately 7,000,000 square feet of office space spread                          150,000
                                                                                                                              square feet of available head lease space in the Government                                    out among 7 submarkets.                                                                      100,000
                                                                                                                              District. The vacant Devonian Building alone accounts for 68.0%

                                                                                                                                                                                                                                                                                                            Square Feet
                                                                                                                              or 159,175 square feet of available head lease space in this district.                         A large contributing factor to this suburban growth is that space                                                                                                 9,728
                                                        Downtown Government District Vacancy                                  The completion of the 108 Street Professional Building (former                                                                                                                                    0
                                                                                                                                                                                                                             downtown is extremely limited and rental rates continue to rise,                                           -3,376                                                            -2,508
                           14.0%                                                                                                                                                                                                                                                                                                                                  -4,307
                                                                                                                              Professional Building) redevelopment at 10830 Jasper Avenue in                                 forcing companies to look to the surrounding areas for space.                                 -50,000
                           12.0%                    11.5%                                                                     August of 2009 will add another 210,500 square feet of available                               Even parking in the downtown core is at a premium, with some
                           10.0%                                                                                              office space to the Government District.                                                       underground parking stalls going for as high as $350 per month.                                                                                    -88,948
                                                                                                                                                                                                                                                                                                                                       Q1 2007      Q2 2007      Q3 2007        Q4 2007       Q1 2008    Q2 2008

                                 8.0%                                      7.2%
                                                                                           6.6%                               This district experienced positive absorption throughout 2007 and
                                                               5.9%                                   5.7%                                                                                                                   All districts contained within the Suburban District have been going
                                 6.0%                                                                         5.1%                                                                                                                                                                                                                   Suburban Office District Vacancy Rates by Area
                                                                                                                              as previously alluded to, the trend has continued in 2008. Capital                             through market fluctuations since mid-year of 2007. Of these districts,                                                  Q2 2008
                                 4.0%                                                                                         Place, First Edmonton Place, HSBC Building, Highfield Place and the                            some have seen space absorbed while others have experienced net
                                 2.0%                                                                                         Financial Building have all experience positive absorption ranging                             increases in available space. The 149th Street, West End and Eastgate
                                                                                                                                                                                                                                                                                                           12.0%             11.1%
                                                                                                                              from 4,000 square feet to 12,000 square feet. Additionally, the                                Districts have all experienced overall positive absorption coming             8.0%                          7.2%
                                                    2003       2004        2005        2006           2007    Q2 08
                                                                                                                              Alberta Government announced in June that they will spend $356                                 largely from growing oil and gas firms, construction companies and                                                                                        5.2%

                                                                                                                              million to renovate and upgrade the 230,000 square foot Federal                                engineering firms. Most notably, the 149th Street District vacancy
                                                                                                                                                                                                                                                                                                           4.0%                                                 2.5%
                                                                                                                              Building to provide new office space and underground parking for                               rate has decreased by 3.0% and can be attributed to its close                 0.0%

                                                                                                                              government employees. The Alberta Government is developing a                                   proximity to large arterial roads and downtown. Higher rental rates
                                                        Downtown Government District Absorption                               master plan for the legislature grounds that will rejuvenate the aging                         in 2007 began pushing people out of downtown into the 124th Street
                                      30,000                                                                                  buildings and create more green space to provide a welcoming and                               District; however, now rates are increasing in this market, pushing
                                                      25,967                                                  25,921
                                      25,000                                                                                  scenic view of the grounds. The plan is expected to be ready for                               some companies further out yet again.
                                                                                                                              public viewing within a year.                                                                                                                                                                              Whyte Avenue District Absorption
                                                                                                                                                                                                                             In contrast, the 118th Avenue/Kingway, 124th Street and South
                        Square Feet

                                      15,000                                                                                                                                                                                                                                                                               20,000.00

                                      10,000                                                                                                                                                                                 Side Districts have all had increased vacancy levels caused by                                15,000.00

                                        5,000                                              1,875
                                                                                                                                                                                                                             the addition of new product in each market either through our                                 10,000.00

                                                                                                                                                                                                                                                                                                            Square Feet
                                                                                                                                                                                                                             expanded reporting or actual new construction. Currently, the South                            5,000.00

                                                                                                                                                                                                                             Side District is the hottest construction zone in Edmonton with over                                                                                                 0
                                                                -4,556                                                                                                                                                       550,000 square feet of inventory added within the last year. Even                                                                                                            -400
                                      -10,000                                                                                                                                                                                                                                                                              -5,000.00
                                                      Q1 07     Q2 07       Q3 07          Q4 07      Q1 08   Q2 08
                                                                                                                                                                                                                             though new vacancy has been constructed or added to the market,                                                                         -5,449
                                                                                                                                                                                                                             rental rates still continue to climb as strong demand remains and                            -10,000.00
                                                                                                                                                                                                                                                                                                                                          Q1 07         Q2 07          Q3 07      Q4 07         Q1 08     Q2 08
                                                                                                                                                                                                                             nearly all space has been committed.

                                                                                                                                                                                                                             Whyte Avenue District - Vacancy 0.3%

                                                                                                                                                                                                        Whyte Avenue
                                                                                                                                                                                                                                                                                                                                          Whyte Avenue District Vacancy
                                                       Downtown Government District
                                                                                                                              “Edmonton is the best metropolitan area to                                                                                                                                    1.6%

                                                       Class            Net Rental Rate                                       invest in Western Canada and third best in all                                                 Edmonton’s Whyte Avenue District is still one of the most preferred                                1.3%
                                                                            ($ PSF)                                                                                                                                          markets in Edmonton for its nearby amenities, thriving businesses,
                                                                                                                              of Canada.”                                                                                    consumer activity and proximity to the University (more specifically
                                                        A                  17 to 25                                                                                                                                          to the University Hospital). Space is extremely limited and the above

                                                         B                 18 to 22                                                         - Edmonton Economic Development Corporation                                      mentioned high demand has pushed rental rates well into the                    0.4%                                                                                          0.3%
                                                                                                                                                                                                                                                                                                                                                                               0.2%           0.2%
                                                        C                  14 to 18                                                                                                                                          $30.00 per square foot range for space in College Plaza, the most
                                                                                                                                                                                                                             sought after Class A office building in the district. Class B office space     0.0%
                                                                                                                                                                                                                                                                                                                               Q1 07            Q2 07      Q3 07               Q4 07          Q1 08      Q2 08
                                                                                                                                                                                                                             is leasing in the high teens to low twenties per square foot.

                                                                                                                         17                                                                                                                                                                           18
             Market Survey Q2-2008                                                                                                                                                                                 Market Survey Q2-2008

               South Side District - Vacancy 9.4%                                                                                                                                                                    124 Street District - Vacancy 7.2%

                                                                                                                                                                                                      124 Street
South Side

                                                                                                                                                                                                                                                                                                                                        124 Street District Vacancy
               The South Side District has been the most sought after and active                                                                                                                                     Since mid-year 2007, the vacancy has increased by 1.9% due to new
                                                                                                                                           South Side District Vacancy                                                                                                                                          8.0%                                                        7.4%
               district for new development, subsequently experiencing a rise in                                                                                                                                     inventory being added to our survey. In the fourth quarter of 2007,                                  7.2%                                                        7.2%
               vacancy rates due in part to new space being constructed. Vacancy                                   12.0%      11.1%                                                                                                                                                                             7.0%
                                                                                                                                                                                                                     Avison Young added the Beaufort Building and Safeway Building                                                                               6.3%
               has increased from 6.3% in the second quarter of 2007 to 9.4% in the                                10.0%
                                                                                                                                                                   9.6%      9.4%        9.4%                        to its office survey adding 41,564 square feet of office space to the                      6.0%                     5.3%
               second quarter of this year, back to the outset level of 2008 after a                                                                                                                                 district. These two buildings account for the adjustment in vacancy                        5.0%
                                                                                                                    8.0%                                                                                                                                                                                                                           4.0%
               dramatic decrease in the 1st quarter. The South Side District has seen                                                      6.3%
                                                                                                                                                    6.8%                                                             between the third quarter and the fourth quarter of 2007.                                  4.0%
               some of the largest deals completed in the Edmonton office market                                    6.0%                                                                                                                                                                                        3.0%
               with Ledcor, Colt Engineering, KBR, Aecon and Clark Builders each                                                                                                                                     On an effective basis, the demand for office space in the 124th Street
                                                                                                                    4.0%                                                                                                                                                                                        2.0%
               taking 20,000 square feet or more in new developments.                                                                                                                                                District has been steadily increasing, largely due to limited space and                    1.0%
                                                                                                                    2.0%                                                                                             increasing rents in the Downtown Districts, resulting in tenants seeking
               The City has several ongoing infrastructure projects currently underway in                                                                                                                                                                                                                       0.0%
                                                                                                                    0.0%                                                                                             more economical lease rates in centrally located areas. As such, this area
               the south side including the 23 Avenue interchange, the continuation of the                                                                                                                                                                                                                               Q1 07           Q2 07    Q3 07      Q4 07          Q1 08    Q2 08
                                                                                                                              Q1 07       Q2 07     Q3 07         Q4 07      Q1 08      Q2 08                        is attractive to tenants who need to be accessible to the central business
               ring road project and the LRT extension. All of these projects are making the
                                                                                                                                                                                                                     district and enjoy the amenities that downtown tenancy offers.
               South Side District even more appealing as companies contemplate new
               long term office locations. As such, the region is starting to achieve rental
                                                                                                                                                                                                                                                  124 Street District Absorption                                                            124 Street District
               rates in the mid to high twenties per square foot for new developments and
                                                                                                                                                                                                                                                                                                                                Percentage of Vacant Space by Class Q2 2008
               in the low to mid twenties per square foot for existing Class A office space.                                                                                                                                            15,000                      11,085
                                                                                                                                                                                                                                                                                                                                      Total Inventory = 861,574sq.ft
                                                                                                                                                                                                                                                                                                                                        Total Vacant = 60,674 sq.ft
                                                           South Side District Absorption                                                      South Side District                                                                                                                                                Class B
                                                                                                                                                                                                                                         5,000                                                    1,630
                                                              83,856                                                                                                                                                                                                                                              58.9%

                                                                                                                                                                                                                         Square Feet
                                      90,000                                                                                       Percentage of Vacant Space by Class Q2 2008
                                                                                                                                        Total Inventroy = 2,135,180 sq.ft
                                      60,000                                                                                               Total Vacant= 188,399 sq.ft                                                                  -5,000
                                      30,000                                                                                                                                                                                                                                            -9,131
                      Square Feet

                                                   6,195                                     2,645                                                                            Class A 60.0%
                                             0                                                                                                                                 99,435 sq.ft                                                                                                                                                                                           Class C
                                                                                                     -1,044                                                                                                                                                                                                                                                                           17.6%
                                                                        -7,991                                                                                                                                                         -25,000                                -21,999
                                     -30,000                                                                                                                                                                                                                                                                                                         Class A                        10,828sq.ft
                                                                                                                                                                                                                                                  Q1 07    Q2 07     Q3 07     Q4 07     Q1 08    Q2 08                                              23.5%
                                     -60,000                                                                                                                                                                                                                                                                                                       14,518sq.ft

                                                                                                                                                                                                                     149 Street District - Vacancy 7.8%

                                                                                                                                                                                                      149 Street
                                     -90,000                                                                       Class B 13.8%
                                                                                 -83,376                                                                                                                                                                                                                                                 149 Street District Vacancy
                                                   Q1 07       Q2 07    Q3 07     Q4 07     Q1 08    Q2 08          45,250 sq.ft                            Class C 26.2 %
                                                                                                                                                             43,714 sq.ft                                                                                                                                                 11.4%
                                                                                                                                                                                                                     The 149th Street District vacancy fell to 7.8%, three percentage points                    12.0%
                                                                                                                                                                                                                                                                                                                                                   10.7%                    10.8%
                                                                                                                                                                                                                     lower than last quarter. This represents 27,749 square feet of absorption
               Eastgate District - Vacancy 2.5%                                                                                             Eastgate District Vacancy                                                and is largely as a result of large pockets being occupied in the West
                                                                                                                                                                                                                                                                                                                10.0%                     9.4%

                                                                                                                   5.0%                                                                                                                                                                                          8.0%
               The Eastgate District experienced a slight increase in vacancy from                                                        4.4%                                                                       End Medical Building, Lamba Business Park and Associated Centre.
               2.0% to 2.5% and remains a tight sub market. In the first quarter of                                4.0%                             3.8%                                                                                                                                                         6.0%
               2008, Eastgate experienced positive absorption of 17,310 square                                                3.4%                                                                                   This area is generally well received by tenants due to its proximity to
               feet. The bulk of this absorption is due to Bantrel’s expansion into                                3.0%                                                                  2.5%
                                                                                                                                                                                                                     Whitemud Drive and Yellowhead Trail, making it easily accessible to
               50th Street Place, resulting in a fully leased office park. The owner has                                                                                     2.0%                                    all areas of the City in a timely manner. Buildings such as the West                        2.0%
                                                                                                                   2.0%                                                                                              End Medical Building have seen a relatively high amount of activity
               recently commenced the construction of an additional 60,000 square                                                                                                                                                                                                                                0.0%
               foot office building on this site. This is a speculative development                                                                                                                                  through numerous smaller sized transactions. Alldritt Development                                    Q1 07           Q2 07    Q3 07         Q4 07      Q1 08    Q2 08
               project with no lease transactions yet secured and one of the first                                                                                                                                   Ltd. is anticipated to build a third office building on their Coronation
               developers to move forward in this district, as other developers                                    0.0%                                                                                              Plaza site at the corner of 142nd Street and 111th Avenue. This
               continue with pre-leasing programs.                                                                           Q1 07        Q2 07    Q3 07          Q4 07      Q1 08       Q2 08                       building will add 50,000 square feet of office supply to this district.

                                                                                                                                                                                                                                                   149 Street District Absorption                                                             149 Street District
                                                            Eastgate District Absorption                                                         Eastgate District
                                                                                                                                   Percentage of Vacant Space by Class Q2 2008                                                                                                                    27,749                        Percentage Of Vacant Space by Class Q2 2008
                                20,000                                                                                                                                                                                                 30,000
                                                                                            17,310                                       Total Inventory = 927,193 sq.ft                                                                                   21,063                                                                      Total Inventory = 925,686sq.ft
                                                             14,460                                                                        Total Vacant = 22,812 sq.ft                                                                 20,000                                                                                            Total Vacant = 72,585sq.ft

                                                                                                                                                                                                                        Square Feet
                                                                                                                                                                                                                                       10,000                                 3,315
                  Square Feet

                                10,000                                                                               Class A 70.6%                                                   Class B 25%
                                                                                                                      16,089 sq.ft                                                   5,723 sq.ft                                            0
                                                                                 2,005                                                                                                                                                 -10,000
                                        0                                                                                                                                                                                              -20,000
                                                 -160                                                                                                                                                                                                                                   -18,962
                                                                                                                                                                                       Class C 4.4%                                    -30,000   -25,673
                                    -5,000                                                           -3,842                                                                                                                                                                                                                   Class B 77.0%                         Class C 23.0%
                                                                                                                                                                                        1000 sq.ft                                                Q1 07    Q2 07    Q3 07     Q4 07     Q1 08     Q2 08
                                                 Q1 07       Q2 07     Q3 07     Q4 07      Q1 08    Q2 08                                                                                                                                                                                                                     62,300 sq.ft                          10,285 sq.ft

                                                                                                              19                                                                                                                                                                                           20
                         Market Survey Q2-2008                                                                                                                                                             Market Composition

                          West End District - Vacancy 5.2%
West End

                                                                                                                                                                                                                 Downtown Office Inventory
                                                                                                                                                   West End District Vacancy
                          The West End District has experienced a consistently low vacancy                                                                                                                       Class                                                             AA            A           B                C         Total
                                                                                                                         7.0%                    6.3%
                          level since the third quarter of 2007. As such, the West End District
                                                                                                                         6.0%                              5.4%
                                                                                                                                                                                                                 Number of Buildings
                          continues to be one of Edmonton’s toughest markets to secure                                                                               5.2%                      5.2%
                                                                                                                                                                                  5.0%                             Financial                                                       8            14         13                9            44
                          vacant space, especially large contiguous blocks of space.                                     5.0%
                                                                                                                                                                                                                   Government                                                  -                13         12               12            37
                          With the low supply and continued demand, developers are now                                   3.0%                                                                                    Total Number of Buildings                                         8            27         25               21            81
                          seeking opportunities to construct office space in the west end. This                                                                                                                  Rentable Area (Square Feet)
                          has kick started marketing programs for future developments such as                                                                                                                     Financial                                              3,562,000      3,928,000    1,459,000          450,000     9,399,000
                          Golden West Business Park (Qualico), West Campus (Remington) and the                           1.0%
                                                                                                                                                                                                                  Government                                                   -        2,387,000    1,567,000          758,000     4,712,000
                          Finning Land site (Syndicat). In the fourth quarter of 2007 the Badenia                        0.0%
                          and Belmead Professional Centres were added and accounted for in our                                   Q1 07           Q2 07    Q3 07     Q4 07         Q1 08        Q2 08             Total Rentable Area                                     3,562,000      6,315,000    3,026,000       1,208,000    14,111,000
                          office survey increasing the Class C inventory by 87,648 square feet.

                                                                  West End District Absorption                                                    West End District                                              Suburban Office Inventory
                                                                                                                                     Percentage of Vacant Space by Class Q2 2008
                                               10,000                          7,231
                                                                                                                                          Total Inventory = 1,000,530 sq ft.
                                                                                                                                                                                                                 Class                                                                           A           B                C         Total
                                                5,000     2,093                                  1,789                                       Total Vacant = 48,484 sq ft.                                        Number of Buildings
                                                    0                                                                                                                                                              118 Avenue/Kingsway                                                           4           4                5            13
                                Square Feet

                                                -5,000                                                    -1,916                                                                                                   124 Street                                                                    3          10                7            20
                                                                                                                                                                                                                   149 Street                                                                    1          19                5            25
                                               -10,000                                  -7,881
                                                                                                                                                                                                                   Eastgate                                                                      3           4                4            11
                                                                                                                                                                                                                   Southside                                                                    22          20                7            49
                                                                                                                                                                                                                   West End                                                                      5          13                2            20
                                                                     -20,975                                                     Class B 78.4%                              Class C 21.6%
                                               -25,000                                                                            38,024 sq.ft                               10,460 sq.ft                          Whyte Avenue                                                                  5           3                1             9
                                                          Q1 07       Q2 07    Q3 07    Q4 07    Q1 08    Q2 08                                                                                                    Sherwood Park                                                                 5           6                4            15
                                                                                                                                                                                                                 Total Number of Buildings                                                      48          79               35          162
                          118 Avenue/Kingsway District - Vacancy 9.2%
 118 Avenue / Kingsway

                                                                                                                                         118 Avenue / Kingsway District Vacancy
                                                                                                                         14.0%     13.2%         12.9%
                                                                                                                                                           13.6%                                                 Rentable Area (Square Feet)
                          This district has had the most significant fluctuations in office space since                                                                                                           118 Avenue/Kingsway                                                     264,000      123,000          125,000       512,000
                          Avison Young’s Annual Report of 2007. Throughout the last half of 2007,                        12.0%
                                                                                                                                                                                                                  124 Street                                                              286,000      446,000          129,000       861,000
                          this district experienced a 4.3% drop in vacancy or 30,707 square feet of                      10.0%                                       9.3%                      9.2%
                                                                                                                                                                                                                  149 Street                                                               75,000      685,000          164,000       924,000
                          absorption. The most noteworthy vacancy drop came from Centre 82                                8.0%
                                                                                                                                                                                  6.3%                            Eastgate                                                                619,000      196,000          113,000       928,000
                          becoming fully leased with 19,000 square feet leased in the fourth quarter
                          of 2007, as well as numerous other transactions. Avison Young added the
                                                                                                                          6.0%                                                                                    South Side                                                            1,138,000      781,000          215,000     2,134,000
                          Bassani Building to its office inventory adding 36,000 square feet of Class B                   4.0%                                                                                    West End                                                                266,000      647,000           88,000     1,001,000
                          office space. This class is the largest in the district and accounts for half of                2.0%                                                                                    Whyte Avenue                                                            380,000       90,000           12,000       482,000
                          the available space in the 118th Avenue / Kingsway District.                                                                                                                            Sherwood Park                                                           152,000      470,000           78,000       700,000
                                                                                                                                   Q1 07         Q2 07     Q3 07     Q4 07        Q1 08       Q2 08              Total Rentable Area                                                    3,180,000    3,438,000         924,000     7,542,000
                          The vacancy is expected to continue a downward trend based on
                          growing companies going through expansions. This district has the
                          opportunity to grow to new heights due to easy access to downtown                                                                                                                      Total Office Inventory                                                                     Number of Buildings          243
                          as well as surrounding industrial areas.                                                                                                                                                                                                                                         Total Square Footage   21,653,000
                                                         118 Avenue / Kingsway District Absorption                                        118 Avenue / Kingsway District
                                                                                                                                    Percentage of Vacant Space by Class Q2 2008
                                                                                                 16,068                                    Total Inventory = 512,878sq.ft
                                              15,000                                                                                         Total Vacant = 47,285sq.ft
                                              10,000                                                                                                                              Class C 34.9%
                            Square Feet

                                                                                                                         Class A 29.1%
                                                                                                                                                                                   10,118 sq.ft
                                               5,000     1,557       1,206                                                16,643 sq.ft
                                                                                                          -14,865                                                                           Class B 36%
                                              -20,000                                                                                                                                       20,479 sq.ft
                                                         Q1 07       Q2 07     Q3 07    Q4 07    Q1 08    Q2 08

                                                                                                                                                                                                           Photo courtesy of Edmonton Economic Development Corporation

                                                                                                                    21                                                                                                                                                                     22
Avison Young                                                                        Avison Young
Notable Lease Transactions                                                          Feature Listings

           The Steppes             West                    ATCO                                 1420 Parsons                      Rohit                                         AMEC
           East Campus             Chambers                Centre                               Road                              Business                                      Building
           1253 – 91 Street        Building                10035 – 105 Street
                                                                                                Building                          Centre                                        4810 – 93 Street
           Tenant: Ledcor          12220 Stony Plain Rd    Tenant: ATCO                                                           8616 – 51 Avenue                              27,362 square feet
                                                                                                1420 Parsons Road
           Properties              Tenant: Veres Picton    285,461 sq.ft.                                                         61,176 square feet                            Suburban - South Side
                                                           (represented landlord)               14,600 square feet
           30,500 sq.ft.           & Co.                                                                                          Suburban - South Side
                                                                                                Suburban – South Side
                                   17,000 sq.ft.

           Bell Tower              Canadian                Canadian                             Baker                             Beaver                                        Broadmoor
           Centre Club             Direct                  Western                              Centre                            House                                         Place 5 and 6
                                   Insurance                                                                                      10158 – 103 Street
           10104 – 103 Avenue      Building                Bank Place                           10025 – 106 Street
                                                                                                                                  66,821 square feet
                                                                                                                                                                                2121 Premier Way,
           Tenant: Stantec                                 10303 Jasper Avenue                  6,796 square feet                                                               Sherwood Park
                                   10115 – 101A Street                                                                            Downtown – Financial
           Consulting Ltd.                                 Lease transactions                   Downtown –                                                                      16,152 square feet
                                   Tenant: Canadian
           52,000 sq.ft.                                   totalling                            Government                                                                      Suburban – Sherwood
                                   Direct Insurance
                                                           74,000 sq.ft.                                                                                                        Park
                                   14,500 sq.ft.

           Commerce                First                   Former                               Canadian                          First                                         Gateway
           Place                   Edmonton                A&B Sound                            Western                           Edmonton                                      Village
           10155 – 102 Street      Place                   Building                             Bank Place                        Place
                                                                                                                                                                                Calgary Trail & 29
           Tenant: Kasian          10665 Jasper Avenue                                          10303 Jasper Avenue
                                                           10232 – 106 Street                                                     10665 Jasper Avenue                           30,000 square feet
           Architecture Interior   Tenant: Safety Codes                                         968 square feet
                                                           Tenant: NorQuest                                                       13,374 square feet                            Suburban - South Side
           Design and Planning     Council                                                      Downtown - Financial
                                                           College                                                                Downtown -
           11,600 sq.ft.           11,200 sq.ft.           31,000 sq.ft.                                                          Government

           Highfield                Highfield                HSBC                                 Manhattan                         Millbourne                                    Quikcard
           Place                   Place                   Building                             Building                          Professional                                  Centre
                                                                                                10345 – 105 Street
           10010 – 106 Street
           Tenant: MacKay LLP
                                   10010 – 106 Street
                                   Tenant: Jacobs Canada
                                                           10055 – 106 Street
                                                           Tenant: Capital                      11,416 square feet                Centre                                        17010 – 103Avenue
                                                                                                                                                                                3,598 square feet
                                                                                                Downtown -                        Millwoods & 38th
           11,166 sq.ft.           Inc.                    Health                                                                                                               Suburban – West End
                                                                                                Government                        Avenue
                                   55,495 sq.ft.           25,000 sq.ft.
                                                                                                                                  41,000 square feet
                                                                                                                                  Suburban - South Side

           Manhattan               Plaza 124               51st Avenue                          51st Avenue                       Summerside                                    Swedish
           Building                10216 – 124 Street      Business                             Business                          Centre                                        Jewellers
           10345 – 105 Street      Tenant: Computronix
                                                           Centre                               Centre                            1020 Parsons Road                             Building
           Tenant: Urban           22,500 sq.ft.                                                94th Street and 51st
                                                           9420 – 51 Avenue                     Avenue Building III               21,832 square feet                            10169 – 101 Street
           Systems                                                                                                                Suburban - South Side
                                                           Tenant: Meyers Norris                15,000 square feet                                                              4,200 square feet
           12,821 sq.ft.
                                                           Penny LLP                            Suburban - South Side                                                           Downtown - Financial
                                                           19,800 sq.ft.

           The Steppes             51st Avenue             Millbourne                           Triton
           West                    Business                Professional                         Business
                                                                                                                        “New space is being absorbed as fast as it is being built.
           Campus                                                                                                       Developments in the west and south Edmonton are pro-
           1259 – 91 Street        Centre                  Centre                               Centre
           Tenant: Kellogg         9420 – 51 Avenue        Millwoods & 38th
                                                                                                                        ducing space that is quickly leased and has resulted in
                                                                                                314 McLeod Avenue
           Brown & Root            Tenant: Beans &         Avenue                               11,000 square feet      positive pressure on rental rates and lease rates.”
           Company (Canada)        Boardroom               Tenant: Solicitor                    Suburban - Spruce
           17,400 sq.ft.           16,500 sq.ft.           General                              Grove                                                   - BOMA Edmonton President David Judge
                                                           50,000 sq.ft.

                                   23                                                                                             24
Speculation Builders Rewarded in Suburban Edmonton                                                                                                    Avison Young Office Team

  After nearly 20 years of no office construction in the subur-            to $32.00 per square foot and include at least a $30.00 per
  ban market, several new buildings have now been built and                square foot tenant improvement allowance. Tenants can ex-                                      Mark                                             Cory D.                                          Garth
  are in the process of being occupied.                                    pect build out costs to be as high as $80.00 to $100.00 per
                                                                                                                                                                          Hartum                                           Wosnack                                          Goodwin
                                                                           square foot which means an upfront capital expenditure of                                                                                       Partner
                                                                                                                                                                          Partner                                                                                           Associate
  Anyone driving through any one of the suburban office                    $50.00 to $70.00 per square foot. It also means a monthly
  districts in Edmonton will notice a multitude of pre-leasing             charge of $100.00 to $150.00 per stall for underground park-                                   Mark Hartum, a Partner                            Cory D. Wosnack, a                               Garth Goodwin holds
  signs; at least 30 projects at present. One cannot blame these           ing and increased pressure to charge for surface parking.                                      with Avison Young, is one                         Partner with Avison                              both a Bachelor of Arts
                                                                                                                                                                          of the leading agents in                          Young and in his 14th                            and Commerce degree
  developers for proceeding with caution as not that long ago                                                                                                             the City of Edmonton.                             year with the firm, is                           from the University of
  the suburban market experienced 17.0% vacancy rates and                  On the supply side, several existing buildings will be on the               Mark has an abundance of experience                                  considered an industry       Alberta. In a relatively short period of time,
  struggled to achieve $5.00 per square foot net rental rates.             market shortly offering large blocks of contiguous space.                   and has provided strategic consulting and         leader focusing largely on Edmonton’s office    he has quickly established himself as a
                                                                                                                                                       representation to a number of national and        market. Cory has earned his reputation          valuable asset to both landlords and office
  Average absorption over the last 10 years has been approxi-              In our opinion, this will be absorbed quickly with room for                 international clients such as; SCM Adjusters,     as one of Edmonton’s most active agents         tenants in the Edmonton market. He has
  mately 45,500 square feet per annum. As such, developers                 several more new office buildings. The West End, South Side                 Ikon, Alberta Treasury Branches, EBA              in the market by brokering over 1,000           recently acted for some of Edmonton’s larger
  are cognizant of how much inventory a healthy market can                 and 50th Street Districts are all in need of more inventory.                Engineering, National Bank Financial, Flint       transactions in his career.                     office tenants and has proven he is capable
                                                                                                                                                       Energy, General Electric, Kraft Canada and                                                        of assisting organizations find creative
  absorb and do not want to risk bringing too much space on-               The key facts going forward will be to offer buildings with                 Maxxam Analytics.                                 Hired by Canada’s largest landlords, Cory       and optimal office leasing solutions. Garth
  line because historically 80,000 square feet of vacant space             smart and efficient designs that are environmentally friend-                                                                  has an unmatched track record of turning        has provided advisory services to highly
  took almost two years to be absorbed.                                    ly, energy efficient and offer an abundance of natural light.               Mark has earned a reputation of being             office listings into fully leased properties.   respected companies such as; the Energy
                                                                                                                                                       able to add tremendous value on behalf of         Cory also has a lengthy resume representing     Resources Conservation Board, Adecco and
                                                                           Ample parking (4 stalls per 1,000 square feet), accessibility               landlords when engaged as their exclusive         the needs of tenants to maximize their real     Ledcor.
  Another contributing factor to this caution has been the                 and location will also be key.                                              listing agent. His marketing expertise and        estate efficiencies which include early lease
  relatively large delta between rental rates for existing prod-                                                                                       analytical capabilities allow him to capitalize   renewals, expansions, relocations, subleases
                                                                                                                                                       on leasing opportunities, structure creative      and terminations.
  uct, ranging from $14.00 to $20.00 per square foot, and the              On the demand side, many of the oil and gas service com-
  $25.00 to $28.00 per square foot rates needed to justify new             panies are gearing up again after some moderation in the
                                                                                                                                                       deals and maximize returns for the various
                                                                                                                                                                                                         Cory enjoys his opportunities to be involved                       Karnie
                                                                                                                                                       landlords and tenants he represents.
  construction.                                                            latter half of 2007 and early 2008. The engineering firms and                                                                 in various community and charitable                                Vertz
                                                                                                                                                       Prior to joining Avison Young, Mark was the       organizations. He currently sits on the Board
                                                                           survey companies are expanding and all three levels of gov-                                                                   of Governors for NorQuest College and is                           Associate
                                                                                                                                                       Associate Vice President at another national
  In spite of this, those few brave developers with enough                 ernment have an appetite for more space. Our expectation                    brokerage company where he began his              Vice Chair of its Infrastructure Committee.
                                                                                                                                                                                                         Cory is also on The Support Network                                In 2000, Karnie was
  courage to put a shovel in the ground and proceed on spec                is that the foreseeable future is very bright.                              career in 1995 after receiving his Bachelor                                                                          drafted by the New York
                                                                                                                                                       of Commerce Degree at the University of           Foundation Board and is a member of the
  have been rewarded. In the movie Field of Dreams there was                                                                                                                                             Business Recruitment Committee for the                             Mets whereby he went
                                                                                                                                                       Alberta.                                                                                                             on to receive a baseball
  a classic line, ” If you build it, [ they ] will come,” and this cer-    Who will be the next to build?                                                                                                Downtown Business Association.
                                                                                                                                                                                                                                                         scholarship at Arkansas State University and
  tainly has been the case in Edmonton. Notable examples                                                                                                                                                                                                 graduated with a Business Finance Degree.
  are: the two buildings Sun Life constructed at Commerce                                                                                                                                                                                                Now in his 4th year of commercial real
  South, The Steppes constructed by Bldg Inc. and Guild De-
                                                                                                                                                                          Jessica                                          Peter                         estate, Karnie’s focus is on managing large
  velopments’ 51st Avenue Business Centre. Not only did                                                                                                                   Neurauter                                        Schwann
                                                                                                                                                                                                                                                         corporate clients in the Edmonton suburban
                                                                                                                                                                                                                                                         office markets.
  these buildings lease, they leased to high quality tenants                                                                                                              Executive Assistant                              Associate
  such as; Colt Engineering, Kellogg Brown & Root, Ledcor and                                                                                                                                                                                            Karnie has been actively engaged in
                                                                                                                                                                         Jessica’s proven track                            In 2004, Peter was            representing suburban office clients such as;
  Meyers Norris Penny.                                                                                                                                                   record of diligence                                                             Guild Developments, LaSalle Investments,
                                                                                                                                                                                                                           recruited by Avison
                                                                                                                                                                         towards        providing                          Young as part of the          Ledcor, Adecco, Restaurex Corporation,
  Clearly, these tenants were willing to pay the premium re-                                                                                                             clients with outstanding                          Office Team. Peter’s          Emkade Distribution, Canadian Federation
                                                                                                                                                       knowledge and support has been                    foundation of a strong work ethic and           of Independent Business, Instrument
  quired to be in new, higher quality buildings that are also                                                                                          instrumental in the Office Team’s success.                                                        Database Solutions and Fountain Tire.
                                                                                                                                                                                                         attention to detail continually result in
  environmentally friendly. The large majority of these deals                                                                                          Jessica brings to the team a strong work          client satisfaction and ongoing business
  were completed in the $25.00 to $28.00 per square foot                                                                                               ethic and a positive attitude which allows        relationships. His diligence to prospecting
                                                                                                                                                       trust to foster among clients and thus            and constant pulse on the marketplace
  range with the respective landlords providing up to $30.00
  per square foot in tenant improvement allowance.
                                                                                                                                                       increase Avison Young’s impact on the
                                                                                                                                                       real estate market in Edmonton.
                                                                                                                                                                                                         continues to bring great value to any
                                                                                                                                                                                                         project he is involved with, both for
                                                                                                                                                                                                         landlord and tenant representation                                 Yarmuch
  Others are now considering forging ahead and will likely                                                                                                                                               assignments.                                                       Administrative Assistant
  enjoy similar success; however, the playing field has now                                                                                                               Angela                         Entering his sixth year in the industry,
  changed. Land and construction costs are higher, landlords                                                                                                              Surridge                       Peter has effectively closed numerous
                                                                                                                                                                                                                                                                            Melissa joined the Avison
                                                                                                                                                                                                                                                                            YoungOfficeTeam in 2007
  want to provide less base building work, underground park-                                                                                                                                             large scale leasing transactions with local,                       after working for one of
                                                                                                                                                                          Executive Assistant            national, and multinational organizations
  ing is extremely expensive and the tenant’s cost to build out                                                                                                                                                                                                             western Canada’s largest
                                                                                                                                                                                                         including; Kellogg Brown and Root,                                 owner/developers.
  their space has sky rocketed; there is also an increased cost if                                                                                                       Angela started with             Computronix Custom House Currency
                                                                                                                                                                         Avison Young in the                                                             Melissa presents a positive contribution to
  one considers LEED certification.                                                                                                                                                                      Exchange Primerica, S.I. Systems, The           the team by providing exceptional customer
                                                                                                                                                                         summer of 2008 after            Capital Region Board, Glenora Dental and
                                                                                                                                                                         having worked at a                                                              service and up-to-date market information
                                                                                                                                                                                                         The Personal Support & Development              to ensure the highest level of satisfaction is
  What does this translate to in terms of dollars and cents?                                                                                           UK based engineering firm planning                Network. Peter is also involved with the
                                                                                                                                                       international    conferences.      Angela’s                                                       achieved for our clients.
  The answer is net rental rates will need to approach $28.00                                                                                                                                            investment market and successfully is in
                                                                                                                     Photo courtesy of Avison Young    ability to work well under pressure, her          the process of completing his Certified
                                                                                                                                                       fine attention to detail coupled with her         Commercial Investment Member (CCIM)
                                                                                                                                                       excellent organizational skills enables her       designation, to become even more
                                                                                                                                                       to provide quality support to the Office          qualified consultant.
                                                                                                                                                       Team and clients.

                                                                      25                                                                                                                                                      26
                                                                                                                                                                                                                                                                                                     Avison Young - Calgary
                    Calgary Market Glimpse                                                                                                                                                                                                                                                           Notable Lease Transactions

                     As part of our Avison Young Alberta coverage, we are pleased                                                             Calgary Q2 2008 Office Vacancy Rates
                                                                                                                                                                           (Including Sublease Space)
                                                                                                                                                                                                                                                                                                                Centennial                Palliser South                                 Manchester
                     to provide you with a brief overview of the City of Calgary office
                     market.                                                                          7.00%
                                                                                                                                                                                                                                                                                                                Place East                                                               Office Park
                                                                                                                                                                                                                                           0.67%                                                                                          140 - 10th Avenue SE                           5440-5500 - 1st Street
Calgary Downtown

                                                                                                      6.00%                                                                                                                              (39,000 SF)

                     Downtown Overview – Vacancy 2.24%                                                                                                               4.79%
                                                                                                                                                                                                                                                                                                                500 - 3rd Avenue SW       Tenant: CCS Inc.                               SW
                     (2.87% including sublease space)                                                                                                                                                                                                                                                           Tenant: Divestco Inc.     81,000 sq.ft.                                  Tenant: Cooperators

                                                                                                                                                                 (84,000 SF)
                                                                                                                                                                                                                                                                                                                199,000 sq.ft.                                                           General Insurance
                                                                                                                                                                                                     (42,000 SF)                                                            0.75%
                                                                                                                                                                                                                                                                          (392,000 SF)
                     Vacancy in Downtown Calgary continues to rise due to space being left                                    0.64%
                                                                                                                        (227,000 SF)                                                                                                                                                                                                                                                     33,000 sq.ft.
                     behind by tenants moving into newly constructed buildings in the City.           2.00%

                     B and C Class space in particularly are feeling the effects of this with         1.00%
                                                                                                                        (798,000 SF)
                                                                                                                                                                 (143,000 SF)
                                                                                                                                                                                                    (198,000 SF)
                                                                                                                                                                                                                                         (343,000 SF)
                                                                                                                                                                                                                                                                     (1.5 Million SF)                           403 33rd St.              Concrete                                       Concrete
                     vacancy in these types of buildings climbing much faster than higher
                     quality buildings. The current vacancy rate is 2.24% for the overall
                                                                                                                      (35.6 Million SF)
                                                                                                                                                                (4.8 Million SF)
                                                                                                                                                                                             Suburban South
                                                                                                                                                                                                (6.2 Million SF)
                                                                                                                                                                                                                                  Suburban North
                                                                                                                                                                                                                                     (5.9 Million SF)
                                                                                                                                                                                                                                                                    (52.5 Million SF)
                                                                                                                                                                                                                                                                                                                Building                  Equities Place                                 Equities Place
                                                                                                                                                                                              Vacant           Sublease

                     Downtown market, up from 1.82% in Q1 2008 and 0.58% one year
                                                                                                                                                                                                                                                                                                                403 - 33rd Street NE      396 - 11th Avenue SW
                     ago. Also noteworthy is that there is a further 0.64% of sublease space                                                                                                                                                                                                                                              Tenant: Smith                                  396 - 11th Avenue SW
                                                                                                                       Calgary Office Q2 2008 Average Asking Net Rental                                                                                                                                         Tenant: Elluminate Inc.
                     available in the downtown area, for a combined vacancy of 2.87%. This                                                  Rates
                                                                                                                                                                                                                                                                                                                23,000 sq.ft.             International Canada                           Tenant: Buffalo Oil
                     increase continues to allow for more movement by tenants than was                                                                                                                                                                                                                                                    Ltd.                                           Corporation
                     possible under previous market conditions.                                                    $55.00
                                                                                                                                                                                                                                                                                                                                          23,000 sq.ft.                                  23,000 sq.ft.
                                                                                                          $50                        $46.00

                     Beltline Overview – Vacancy 3.02%                                                    $40

                                                                                                                                                                                                                                                                                                                Concrete                  Parkside Place                                 Altius Centre
                     (4.79% including sublease space)                                                                                         $35.00
 Calgary Beltline

                                                                                                  $ PSF
                                                                                                                                                                                                                                                                                                                Equities Place
                                                                                                          $30                                          $28.00
                                                                                                                                                                                                                       $26.00                                    $26.00
                                                                                                                                                                                                                                $25.00                                    $25.00

                                                                                                                                                                                                                                         $20.00                                    $20.00                                                 602 - 12th Avenue SW                           500 - 4th Avenue SW
                     The vacancy rate for Beltline Calgary is 3.02% for second quarter 2008               $20
                                                                                                                                                                                                                                                  $16.00                                    $16.00
                                                                                                                                                                                                                                                                                                                                          Tenant: 678647 Alberta                         Tenant: Upper Lake Oil
                     remaining flat from first quarter 2008 and up from 0.84% one year ago.               $10
                                                                                                                                                                                                                                                                                                                396 - 11th Avenue SW      Ltd.                                           & Gas Ltd.
                     Further to this is an additional 1.77% of sublease space available, for a             $0                                                                                                                                                                                                   Tenant: Hopewell          11,000 sq.ft.                                  10,000 sq.ft.
                     combined vacancy of 4.79%. While direct vacancy only increased 2,000                                     Downtown                                         Beltline                                Suburban South                            Suburban North
                                                                                                                                                                                                                                                                                                                Developments Inc.
                                                                                                                                                       AA Class           New Construction                     A Class            B Class             C Class
                     square feet (1%) from first quarter, which had 141,000 square feet of                                                                                                                                                                                                                      11,000 sq.ft.
                     vacancy, sublease space increased 8,000 square feet (11%) from the first
                                                                                                                                                   Overall Calgary Office Absorption
                     quarter of 2008, which had 76,000 square feet of sublease vacancy.                                                                                                (Square Feet)
                                                                                                                                                                                                                                                                                                     Avison Young - Calgary
                     Suburban Overview – Vacancy North                                                    2,127,600                                                                                                                                                                748,700
                                                                                                                                                                                                                                                                                                     Feature Listings
                     5.84% (6.51% including sublease space)                                                                                                                                                        1,698,400

                     Vacancy South 3.20%                                                                                                                                                                                                 1,464,900

                                                                                                                                                                                                                                                                                                                Palliser South            Airstate                                       Barron

                     (3.89% including sublease space)                                                                                                                                         969,400



                                                                                                                                                                                                                                                                                                                140 - 10th Avenue SE
                     The second quarter of 2008 saw vacancy reach 4.49% for the overall                                                                                                                                                                                                                         New Downtown
                     Suburban market, with vacancy once again rising in both Suburban                                                                                                                                                                                                                                                     1200 - 59th Avenue SE                          610 - 8th Avenue SW
                     North and South Calgary. Suburban North’s vacancy rate for second
                                                                                                            2000               2001                    2002
                                                                                                                                                       2002                2003                 2004                   2005                 2006                 2007          2008 YTD
                                                                                                                                                                                                                                                                                                                                          New Suburban                                   Downtown
                                                                                                                                                                                                                                                                                                                210,000 sq.ft.
                                                                                                                                                                                                                                                                                                                                          Development                                    Opportunity
 Calgary Suburban

                     quarter 2008 is 5.84% (6.51% including sublease space), up from 4.73%                                                        -543,100
                                                                                                                                                                                                                                                                                                                Contact: Glenn
                     at the end of first quarter 2008 and 2.20% one year ago. Looking at the                                                                                                                                                                                                                                              108,750 sq.ft.                                 80,579 sq.ft.
                     specific quadrants of the north continues to show two very different                                                                                                                                                                                                                                                 Contact: Pat Owens                             Contact: Alex Wong
                                                                                                                                            Calgary Office New Development
                     markets for office space as the northwest currently has a vacancy of                                                                        (in Millions of Square Feet)

                     0.83% (2.15% including sublease space) while the northeast has a
                     vacancy of 7.42% (7.88% including sublease space). Within the entire                                                                                                                                                                                                                       1601 - 9th                625 - 42nd                                     403 33rd St.
                     Suburban North there is 343,000 square feet of headlease office space
                                                                                                  (Existing: 34.2 million SF)
                                                                                                                                                                     6.3                                     2.0                                           8.0
                                                                                                                                                                                                                                                                                                                Avenue SE                 Avenue NE                                      Building
                     available for tenants divided between 37 buildings with the largest                                                                                                                                                                                                                                                                                                 403 - 33rd Street NE
                     contiguous pocket being 60,000 square feet in 2735 – 39th Avenue
                                                                                                                      Beltline 0.4 1.2
                                                                                                  (Existing: 4.8 million SF)
                                                                                                                                                                                                                                                                                                                New Suburban              Suburban Opportunity                           Suburban Opportunity
                     NE. The vacancy rate for Suburban South is 3.20% (3.89% including                                                                                                                                                                                                                          Development               25,000 sq.ft.                                  23,000 sq.ft.
                     sublease space), up from 2.55% at the end of first quarter 2008 and                  Suburban North
                                                                                                  (Existing: 5.9 million SF)
                                                                                                                                         0.8 1.1                         3.6
                                                                                                                                                                                                                                                                                                                20,560 sq.ft.             Contact: Ed Dorosz &                           Contact: Glenn
                     1.55% one year ago. Within the Suburban South market there is a total                                                                                                                                                                                                                      Contact: Glenn            Pat Owens                                      Simpson, Larry Gurtler
                     of 198,000 square feet vacant head lease space for lease divided among               Suburban South
                                                                                                   (Existing: 6.2 million SF)
                                                                                                                                                1.8                2.1              2.2
                                                                                                                                                                                                                                                                                                                Simpson & Doug Pilip                                                     & Todd Throndson
                     26 buildings. The largest contiguous pocket available is 50,000 square                                             0                   2                 4                6                   8               10                  12           14                 16
                                                                                                                                                                                           Square Feet (Millions)
                     feet in MacLeod Place II.                                                                                                                           Under Construction                   Pre-Leasing                Proposed                                                                                                          Calgary Contact Info:   Gulf Canada Square
                                                                                                                                                                                                                                                                                                                                                                                   Suite 309, 401 - 9th Avenue
                     For more information on the City of Calgary office market, please view our full report available online at                                                                                                                                                                                                                                                     Tel: 403.262.3082
            Office Report 2008                                                                                                                                                                                                                                                                                     Fax:403.262.3325

                                                                                             27                                                                                                                                                                                                                                           28
Edmonton Events and Festivals 2008-2009                                                                                                                                               Edmonton Events and Festivals 2008-2009

   Summer 2008                                                                                                                                                                         Rexall Edmonton Indy
                                                                                                                                                                                       July 24 - July 26 2008                                                      Edmonton International Fringe Theatre
   Feats - Festival of Dance                                                                                                                                                                                                                                       Festival
   June 27 - July 13 2008                                                                                                                                                              Auto racing fans across North America can expect to see the best in         August 14 - August 24 2008
                                                                                                                                                                                       open wheel racing as the Rexall Edmonton Indy is set to drive into
   Alberta Dance Alliance is the organization that produces this                                                                                                                       high gear. Edmonton’s biggest summer celebration will kick off in           The largest Fringe Festival on the continent will feature more than
   spectacular festival. Feats is a multi-disciplinary dance festival                                                                                                                  July as Edmonton’s Capital EX brings the thrills of the midway and          130 shows from around the world, an entertaining street scene, a
   in Edmonton that includes performances, special events, and                                                                                                                         the Rexall Edmonton Indy draws the biggest names in motor racing            plethora of food vendors and craftwork by local artisans. The annual
   programs of education and awareness.                                                                                                                                                to the city.                                                                festival will welcome 500,000 visitors as it presents more than 1000
                                                                                                                                                                                                                                                                   performances on the indoor and outdoor stages.                                                                                                                                                 
   Canada Day Celebrations                                                                                                                                                             Edmonton and Athabasca District
   July 1 2008                                                                                                                                                                         Historic Festival                                                           Edmonton Dragon Boat Festival
                                                                                                                                                                                       July 25 - August 3 2008                                                     August 22 - August 24 2008
   Canada Day begins with a pancake breakfast, a road race, fun run
   and a citizenship court at the Alberta Legislature grounds. The Silly                                                Photo courtesy of Edmonton Economic Development Corporation
                                                                                                                                                                                       The Edmonton and District Historical Society is presenting its              This 2,000 year old Chinese tradition continues to draw over 5,000
   Summer Parade moves through the Old Strathcona Historical Area                                                                                                                      12th annual historic festival. This festival is a family oriented event     spectators and 1,500 participants. This fantastic outdoor festival is
   at noon, and there are special afternoon celebrations throughout                                                                                                                    that features tours and activities at museums, historic sites and in        located in Government House Park.
   the city. When night falls, the Great Divide Waterfall becomes the                          Capital Ex Festival                                                                     communities and it showcases the stories of our history and cultural
   focal point underneath a spectacular fireworks performance over                             July 17 – July 26 2008                                                                  heritage in urban and rural settings.                             
   the river valley.
                                                                                               Capital Ex kicks off with an exciting downtown parade full of fabulous                                                                               floats of all shapes and designs and bands with an imaginative
                                                                                               display of music and pageantry will make their way through the                          Edmonton Heritage Festival
                                                                                               heart of the city. This exhibition will encompass an exciting variety                   August 2 – August 4 2008
                                                                                               of entertainment, culture and shopping which is sure to be fun for
                                                                                               the whole family.                                                                       Come to Edmonton for a celebration of the cultural diversity that
                                                                                                                                                                                       makes up Canada. Sixty cultures at fifty-plus outdoor pavilions
                                                                                                                                                           feature non-stop international music, dancing, food, arts & crafts,
                                                                                                                                                                                       costumes and more. Enjoy everything that Canadians have to offer
                                                                                               A Taste of Edmonton                                                                     by seeing where we came from. Admission is free, but please bring
                                                                                               July 18 - July 27 2008                                                                  along a non-perishable food item to donate to the Edmonton Food
                                                                                               Sir Winston Churchill Square transforms into an outdoor food
                                                                                               sampling arena which brings out the best Edmonton restaurants                                                                                              Photo courtesy of Edmonton Economic Development Corporation

                                                                                               for you to enjoy. A Taste of Edmonton, A Taste of Wine, and Sunday                                                                                                  Symphony Under the Sky
                                                                                               in the City as well as live performances and a marketplace are all                      Edmonton Folk Music Festival                                                August 29 - September 1 2008
                                                                                               part of this ten day adventure into culinary excellence.                                August 7 - August 10 2008
                                                                                                                                                                                                                                                                   A five-day al fresco extravaganza of classical music compliments of
                                                                                                                                                        This festival offers the audience an eclectic mix of music for everyone.    the Edmonton Symphony Orchestra. This event will be taking place
                                                                                                                                                                                       The natural amphitheatre located in Gallagher Park has become               in Hawrelak Park’s amphitheatre.
                                                                                               Leonard Cohen International Festival                                                    the home for this experience, which also, has a wide array of food
                            Photo courtesy of Edmonton Economic Development Corporation        July 23 - July 28 2008                                                                  concessions, family areas, general store and a beer gardens.      
   Edmonton Street Performers Festival
   July 4 - July 13 2008
                                                                                               The biennial Cohen Event organized by The Leonard Cohen Files has                                                                 Storytelling Festival-Presented by
                                                                                               combined forces with the annual “Leonard Cohen Nights” festival in                                                                                                  Fort Edmonton Park
   Downtown Edmonton is alive for ten fun-filled days of free
                                                                                               Edmonton for a festival bigger and better than ever! It will feature                    Cariwest - Edmonton Caribbean Arts                                          August 31 - September 1 2008
   performances by internationally known street acts including
                                                                                               Jann Arden and Serena Ryder along with numerous other acts. In                          Festival
                                                                                               addition there will be open mike performances, poetry readings,                         August 8 - August 10 2008                                                   Fort Edmonton Park and T.A.L.E.S. celebrate the art of storytelling
   magicians, clowns, jugglers, mimes, musicians & comics for the
                                                                                               and a visual arts display plus participant activities.                                                                                                              at the 20th Anniversary of this magical festival. Storytellers situated
   young-at-heart. This festival has become recognized internationally
   and thus it brings out the very best talent for your enjoyment.                                                                                                                     A colorful costume extravaganza, calypso competition and a gala             throughout the Park will share fictional and true tales that will lead
                                                                                                                                                   parade are part of this Caribbean festival that includes a dance, block     your imagination into a land of delight, enchantment and learning.                                                                                                                                                          party and steel band competition.                                           Play some old time games, construct a craft and enjoy the musical
                                                                                                                                                                                                                                                                   entertainment! The whole family is sure to enjoy this event.

                                                                                          29                                                                                                                                                                  30
Edmonton Events and Festivals 2008-2009                                                                                                                                     2007 - 2008 Headlines

  Fall 2008                                                                       Winter 2008/2009                                                                            June 2007                                                                                   October 2007
  Edmonton International Film Festival                                            New Year’s Eve Downtown                                                                     On June 29 at 3:26a.m., Red Pandas are born at the Valley Zoo. The                          The Art Gallery of Alberta is unveiled to the public. The gallery
  September 26 - October 4 2008                                                   December 31 2008                                                                            zoo has joined an international breeding program in an effort to                            will give not only Alberta recognition on a national scale but
                                                                                                                                                                              preserve the species. There are only an estimated 2,500 of these rare                       Edmonton will conversely benefit from having an extraordinary
  Come celebrate the Edmonton International Film Festival’s 22st                  Bring in the New Year at Western Canada’s largest free New Year’s                           pandas left in the world.                                                                   building that showcases our cities cultural sensibility.
  anniversary as for nine days and nights, movie fans and filmmakers from         celebration. This family event features both indoor and outdoor venues
  across Canada and around the globe gather to eat, sleep and breathe all         offering activities and entertainment for all ages. This day of celebration                 September 2007                                                                              December 2007
  things cinematic! This festival features full-length films, documentaries       will be held at Sir Winston Churchill Square.
  and short films from all corners of the globe which are sure entertain.                                                                                                     Alberta government announces plan to lower tuition for post-                                Edmonton receives news that a new tower will be constructed.
                                                                                                                                               secondary students over the next three years. The $136 million                              Epcor Tower will be the first office tower in 17 years to grace
                                                                                                                                                                              dollar plan will lower tuition which will ultimately increase student                       the skyline of Edmonton. The tower will house restaurants
  Canadian Finals Rodeo                                                                                                                                                       enrollment and curb our shortage of skilled workers.                                        and retail shops with numerous other services occupying the
                                                                                                                                                                                                                                                                          614,000 sq ft building at the Station Lands site.
  November 5 - November 9 2008
                                                                                                                                                                              October 2007
  The Canadian Finals Rodeo takes over Edmonton, bringing together                                                                                                                                                                                                        March 2008
  the country’s top cowboys to compete for their chance to be crowned                                                                                                         An official announcement is made by the International Basketball
  Canadian Champion. They will wrestle steers, rope cattle, race around                                                                                                       League (IBL), that Edmonton will have a professional basketball                             Alberta government begins to break ground on a number of
  barrels at break-neck speeds, and battle bucking broncos and bulls for                                                                                                      team known as the Edmonton Chill. This professional team will be                            infrastructure improvements in and around the Edmonton
  the chance to take home the buckle of a champion. It is the wildest ride                                                                                                    taking the court for the 2008 season.                                                       area. The 23 Avenue interchange, LRT access to Heritage and
  in the west.                                                                                                                                                                                                                                                            the continuation of the Anthony Henday are all projects that
                                                                                                                                                                                                                                                                          curb traffic slowdowns and encourage growth.
                                                                                                              Photo courtesy of Edmonton Economic Development Corporation                                                                                                 May 2008
  Bright Nights Winter Family Festival
  November 22 - January 5 2009                                                    Spring 2009                                                                                                                                                                             The Indy Racing League (IRL) and Northlands sign a three-
                                                                                                                                                                                                                                                                          year agreement to hold the Rexall Edmonton Indy at the City-
  This event is Edmonton’s premiere event to officially welcoming the             Edmonton International Jazz Festival                                                                                                                                                    Centre Airport on a 14-turn, 1.97 mile runway, which is set to
  Christmas season. The event routinely garners over 500 giant displays           June 20 - June 29 2009                                                                                                                                                                  go on July 26. Start your engines!
  that blanket Hawrelak Park in a winter wonderland of light. The event is
  also held at Sir Winston Churchill Square and the Legislative Grounds.          The Edmonton International Jazz Festival offers an outstanding array                                                                                                                    June 2008
                                                                                  of some of the finest jazz musicians from all over the world. Over 175                                                         jazz artists will present over 70 musical performances on 10 stages.                                                                                                                    Leading commercial real estate firm, Avison Young names
                                                                                  Regardless of your musical taste, awareness or comfort level you will
                                                                                                                                                                                                                                                                          Mark Rose CEO. The company is excited to have him on board
  Festival of Trees                                                               find some memorable musical memories by attending a few jazz
                                                                                                                                                                                                                                                                          and hopes he will take the company to new heights and even
  November 27 - November 30 2008                                                  concerts. Venues include Winspear Centre, Maclab Theater, Yardbird
                                                                                                                                                                                                                                                                          greater successes.
                                                                                  Suite, Varscona Theater, and Rutherford Room.
  Commencing at the Shaw Conference Centre this winter is the festival
  of trees which showcases decorations that will light up a children’s face.                                                                                                                                                                    June 2008
  This event comes complete with children’s activities, live entertainment,
  shops and holiday treats. Proceeds from the festival will be given to the       The Works Art and Design Festival                                                                                                                                                       NHL unanimously approves the sale of the Edmonton Oilers
  Seconds Save Lives Foundation to purchase life saving equipment for             June 20 - July 2 2009                                                                                                                                                                   to local billionaire Daryl Katz of the Katz Group of Retail
  trauma patients.                                                                                                                                                                                                                                                        Pharmacies for $200 million. He pledges to keep the Oilers
                                                                                  This year The Works is returning to the Square for what will be the                                                                                                                     in Edmonton and pony up $100 million for a new downtown                                                       biggest and best art & design festival celebrating the arts and cultural                                                                                                                arena.
                                                                                  heritage of Edmonton and Canada. The Festival site will also include The
                                                                                  Works Street Market, The Works Street Stage and The Works Street Cafe                                                                                                                   July 2008
                                                                                  all situated on Sir Winston Churchill Square.
                                                                                                                                                                                                                                                                          Avison Young and RBC sold Petroleum Plaza for $130 million
                                                                                                                                                                                                                                              after being retained by the vendor. This 300,000 square foot
                                                                                                                                                                                                                                                                          asset was originally purchased by the vendor in 2005 for
                                                                                                                                                                                                                                                                          $27.9 million.
                                                                                                                                                                                                       Photo courtesy of Edmonton Economic Development Corporation

                                                                             31                                                                                                                                                                                      32
Avison Young Client Services                                                                                                                Avison Young Client Services

  Integrated Real Estate Services                                                                                                            Vision Statement                                                                 financial analysis of these alternatives and to negotiate the
                                                                                                                                                                                                                              best result.
  Our commitment has been to provide a full range of services and                                                                            To build an enduring company that people want to be a part of,
  truly integrating them to tailor solutions for our clients. The full                                                                       clients will be loyal to, and that will be the dominant commercial               We are creative, we communicate with our clients, we focus
  service approach has been an overwhelming success for Avison                                                                               real estate service provider in Canada.                                          and we perform.
  Young and includes:
                                                                                                                                             Mission Statement                                                                Sales and Acquisitions
                                                                                                                                             Avison Young is the market leader in providing comprehensive                     We act for both vendors and purchasers in the sale or purchase
  •    Leasing                                                                                                                               sales, leasing and consulting services to owners and users of real               of office buildings, shopping centres, industrial projects,
  •    Purchasing                                                                                                                            estate through capitalizing on our skills, experience, ethics and                rental apartment buildings, mixed use projects and future
  •    Build-to-suit consultation                                                                                                            dedication for the benefit of our clients.                                       development land. Our expertise in property valuation,
                                                                                                                                                                                                                              forecasting supply and demand trends, understanding
  •    Construction management
  •    Lease renewals, analysis and restructuring                                                                                            Corporate Philosophy                                                             development issues and knowing the active buyers and
                                                                                                                                                                                                                              sellers, allows us to achieve the best possible prices for our
                                                                                                                                             Our corporate philosophy is founded on the following axioms:                     clients.

                                                                                                                                             COMMITMENT                                                                       Before we begin to market a property or assist a client with
  •    Office                                                                                                                                                                                                                 the purchase of a facility, we make sure that we understand
  •    Industrial                                                                                                                                                                                                             all aspects of the property by carrying out our own physical
                                                                                                                                             Avison Young is committed to providing service to clients with
  •    Retail                                                                                                                                professionalism, integrity, and attention to detail, all in a first class        and financial due diligence. When selling a facility on behalf
  •    Multi-residential                                                                                                                     manner.                                                                          of the vendor we use the aid of our detailed, high quality
  •    Land                                                                                                                                                                                                                   particulars of sale. Then we direct our marketing efforts to an
                                                                                                                                             PERFORMANCE                                                                      extensive list of qualified prospects worldwide.
                                                                                                                                             Avison Young only accepts assignments and mandates which                         Our clients readily recognize our in-depth knowledge and
  •    Consulting services                                                                                                                   it believes it can handle. This has led to a strong record of                    sound advice which often result in our acting on their behalf
                                                                                                                                             performance for the thousands of tenants we have assisted. In                    to acquire property using a stealth approach. Whatever
  •    Appraisal
                                                                                                                                             fact, it is our performance that has encouraged tenants to use our               the reason, Avison Young has successfully assisted many
  •    Mergers and acquisitions
                                                                                                                                             services repeatedly for multiple locations or to relocate/renew at               companies with the purchase of properties on an undisclosed
  •    Asset management                                                                                                                                                                                                       basis at the best possible purchase price.
                                                                                                                                             the end of their lease terms.
  •    Lease review
                                                                                                                                             Avison Young will not compromise its ability to perform for our
  •    Structuring documents                                                                                                                 clients by accepting more tenant mandates or exclusive listings
  •    Operating costs review                                                                                                                than it can conceivably handle. We prefer to work with fewer
  •    Landlord/tenant dispute negotiations                                                                                                  clients at one time and provide a higher level of service.

  LEASING SERVICES                                                                                                                           EMPLOYEES

  •    Office                                                                                                                                Avison Young only employs high caliber, disciplined, trustworthy
  •    Industrial                                                                                                                            individuals, who demonstrate motivation to provide the best
  •    Retail                                                                                                                                possible service to our clients.
  •    Distribution and warehousing
                                                                                                                                             We act for both landlords and tenants to lease a wide variety of
                                                                                                                                             office, retail and industrial space. Our assignments include pre-
  •    Rental information
                                                                                                                                             leasing, lease renewals, sub-leasing, restructuring existing leases
  •    Vacancy information                                                                                                                   and negotiating lease terminations.
  •    Historical data
  •    Land ownership                                                                                                                        Many tenants have recognized our experience and retained us
  •    Topical reports                                                                                                                       to represent them as they go through the process of deciding to
                                                                                                                                             remain in their existing premises or relocate. They utilize our ability                                Photo courtesy of Edmonton Economic Development Corporation
                                                                                                                                             to analyze their requirements and make recommendations, to
                                                                                                                                             bring forward the most viable alternatives, to provide an in-depth

                                                                              Photo courtesy of Edmonton Economic Development Corporation
                                                                         33                                                                                                                                              34
Information Sources                                                                                                                                                       Avison Young Office Locations

  We would like to thank the following for the use of photos, information or the use of their name in representing their story in our
  publication. We apologize, if we have used information without sourcing your website. We ask that you send us an email and we will gladly
  accommodate the correction in 2009.

                                                                                 CBC Canada
  Alberta Economic Development

                                                                                 Conference Board of Canada
  Canada Mortgage and Housing Corporation                                                  

  City of Edmonton                                                               Government of Canada                                                      

  Edmonton Economic Development Corporation                                      BOMA Edmonton                                                     

  Edmonton Journal

  Government of Alberta

  Connect 2 Edmonton

  Statistics Canada

  Avison Young (Calgary)
                                                                                                                                                                             1   Vancouver                                    4    Regina                                                  8   Ottawa
  Festival Information                                                                                                                                                           10055 West Georgia Street                         2550 - 12th Avenue, Suite 300                               Manulife Place, Suite 1200                                                                                                                                                            Suite 2100, Box 11109 Royal Centre                Regina, SK S4P 3X1                                          Ottawa, ON KIP GL5
                                                                                                                                                                                 Vancouver, BC V6E 3P3                             T 306.359.9799                                              T 613.567.2680
                                                                                                                                                                                 T 604.687.7331                                    F 306.352.5325                                              F 613.567.2671
  Edmonton Research Park                                                                                                                                                         F 604.687.0031                                                                                                                                                                                               5    Winnipeg                                                9   Montreal
                                                                                                                                                                             2   Edmonton                                          330 Portage Avenue, Suite 1000                              2000 McGill College Avenue, Suite 1950
                                                                                                                                                                                 2500 Scotia Place, Tower 1                        Winnipeg, MB R3C 0C4                                        Montreal, QC H3A 3H3
  Infrastructure Canada                                                                                                                                                          10060 Jasper Avenue                               T 204.947.2242                                              T 514.940.5330                                                                                                                                        Edmonton, AB T5J 3R8                              F 204.943.2680                                              F 514.940.5331
                                                                                                                                                                                 T 780.428.7850
                                                                                                                                   Photo courtesy of Connect 2 Edmonton
                                                                                                                                                                                 F 780.424.5815                               6    Mississauga                                         10      Quebec City
                                                                                                                                                                                                                                   30 EglintonAvenue West, Suite 300                           1300 Ste-Anne Blvd
                                                                                                                                                                             3   Calgary                                           Mississauga, ON L5R 3E7                                     Quebec City, QC G1E 3M5
                                                                                                                                                                                 Gulf Canada Square                                T 905.712.2100                                              T 418.694.3330
  In conjunction with the Edmonton Office Team, this report was designed and produced by:                                                                                        Suite 309, 401-9th Avenue SW                      F 905.712.2937                                              F 418.694.3334
                                                                                                                                                                                 Calgary, AB T2P 3C5
  Songhurst, Shane | Researcher | Avison Young Commercial Real Estate [Alberta] | 780.702.0691 |                                                            T 403.262.3082
                                                                                                                                                                                 F 403.262.3325
                                                                                                                                                                                                                              7    Toronto                                             11      Halifax
  Bezuidenhout, Waldo | Researcher | Avison Young Commercial Real Estate [Alberta] | 780.702.5832 |                                                                                                        150 York Street                                             Bank of Canada Building
                                                                                                                                                                                                                                   Suite 900                                                   1583 Hollis Street, Suite 302
  Seinen, Sheena| Graphic Designer| Avison Young Commercial Real Estate [Alberta] | 780.429.7574 |
                                                                                                                                                                                                                                   Toronto, ON M5H 3S5                                         Halifax, NS B3J 1V4
                                                                                                                                                                                                                                   T 416.955.0000                                              T 902.442.4050
                                                                                                                                                                                                                                   F 416.955.0724                                              F 902.442.4051
                                Additional copies of this publication are available from Avison Young Commercial Real Estate [Alberta].
                                                                                                                                                                                                                 Avison Young has a strategic alliance with NewWest Enterprises
                                The information contained herein was obtained from sources deemed reliable and is believed to be true at the time of                                                             Property Group. This partnership allows Avison Young to enhance its
                                publication; it has not been verified and as such, cannot be warranted nor form any part of any future contract. The contents of                                                 overall scope of services by expanding into property management.
                                this publication may not be reproduced without permission of the Publisher.                                                                                                      This benefits both our new and existing building owners by facilitating
                                                                                                                                                                                                                 a one-stop shopping experience.

                                                                          35                                                                                                                                                                       36
                                                                       Photo courtesy of Connect 2 Edmonton

                                                 AVISON YOUNG
                                                     Commercial Real Estate [Alberta]
              2500 Scotia Place, Tower 1, 10060 Jasper Avenue, Edmonton, AB T5J 3R8
T 780.428.7850 F 780.424.5815 E W

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