City’s $100M fund set to announce first recipient
The first beneficiary of a $100-million municipal fund meant to boost the Calgary economy is set to be announced Thursday, and city officials promise more applicants will receive money before the end of the year. Calgary Economic Development, which administers the Opportunity Calgary Investment Fund established by city council this spring, said it has received more than 150 submissions since the application process opened in June. CED did not provide details about the first successful applicant, although an event scheduled for Thursday and hosted by a venture capital firm is billed as celebrating the launch of a “new Canadian technology company” that has raised a significant amount of funding from “all orders of government.” Barry
Munro, the chair of the Opportunity Calgary Investment Fund, is slated to speak at that event.
Modelled after similar programs in other jurisdictions, including Texas and Kitchener-Waterloo, Calgary’s $100-million fund is meant to offer opportunities for private-sector companies, nonprofits and public institutions looking to make “transformative investments” in the local economy. Applicants are asked to propose projects that will create jobs, help to diversify the Calgary economy and expand the property tax assessment base.
Calgary Economic Development executive chair Steve Allan said the $100-million fund is the highest profile piece of the city ’s new longterm economic strategy, which was formally launched Wednesday at CED’s annual Economic Outlook luncheon. Allan said while Calgary’s economy has rebounded somewhat from the 2015-16 recession, unemployment remains stubbornly high (8.2 per cent in August, according to Statistics Canada) while more than 13 million square feet of office space in the downtown remains empty.
“Our two biggest challenges in Calgary right now are these empty office towers downtown … and our high unemployment rate,” Allan said. “There is no quick fix for this, so this strategy, I think, really helps to address those two issues. It’s a long-term play.”
The new strategy — which was created with the input of business leaders, social agencies, educational institutions and individuals — aims to make Calgary the “city of choice in Canada for the world’s best entrepreneurs.” It identifies seven industries where Calgary has a competitive advantage, including energy, agribusiness, transportation and logistics, tourism, creative industries, life sciences and health, and financial services.
The plan proposes a number of ways to grow these industries in Calgary, from intensifying talent attraction and retention efforts to nurturing entrepreneurs to making Calgary an even more attractive place to live by expanding and enhancing tourism, culture and recreation assets.
Last year, Calgary mounted an unsuccessful bid to attract tech giant Amazon to locate its second headquarters here. Mayor Naheed Nenshi told reporters Wednesday that the city is still interested in enticing big companies to relocate here from other jurisdictions and take up some of the city ’s empty office space. However, he said those efforts need to exist alongside initiatives aimed at growing Calgary ’s economy from the ground up.
“Going for the big fish is helpful in two ways. One, if you land one, that’s amazing,” Nenshi said. “But the other is, as with the Amazon HQ2 bid, it really helps you understand your case, where your strengths and weaknesses are, and it really lets you be much more effective in going after the small and medium-sized fish. So we’ve got to do it all at once.”
In a speech at the Economic Outlook on Wednesday, Conference Board of Canada deputy chief economist Pedro Antunes predicted Calgary’s economy will grow at a rate of just over two per cent in 2019. He said while that is considered “moderate” growth, he remains concerned that Alberta oil continues to sell at a deep discount, due largely to pipeline setbacks and ongoing regulatory uncertainty.
“We don’t see getting back to pre-recession levels in terms of overall economic activity until mid-2019,” Antunes said.
Calgary’s overall office vacancy rate increased marginally to 23.5 per cent in the second quarter of 2018, up from 23.2 per cent in the first quarter, according to commercial real estate firm Avison Young. In a report released Wednesday, the firm said Calgary’s office market appears to have “found bottom.”