Edmonton notes the need to reverse the erosion of the non-residential tax base

A weathered sign advertising 40 acres of industrial land for sale in northeast Edmonton symbolizes the city’s struggle to attract industrial development.

The land is just a fraction of the nearly 50 square kilometers the city annexed more than a decade ago in a district called the Edmonton Energy and Technology Park.

“We were hoping this would be a success with petrochemicals and plastics and things like that,” Anand Pye, the CEO of the Edmonton Commercial Real Estate Development Association, told CTV News Edmonton on Wednesday.

“We haven’t seen that specifically in Edmonton yet.”

Pye says the city needs to do more to attract industrial businesses, adding that only “0.1 percent of the total industrial land area is serviced and ready for a business to move in tomorrow.”

City data shows that Edmonton’s share of non-residential properties in the region has fallen from 72 per cent in 2008 to 60 per cent in 2022.

Edmonton Mayor Amarjeet Sohi called the data “a wake-up call.”

“If we don’t act now, we will (and will) continue to lose,” he said during an executive committee meeting at City Hall on Wednesday.

Retail businesses, offices, warehouses and other non-residential properties contribute half of the tax revenue the city collects to pay for the budget. With fewer businesses, those that remain — and possibly homeowners — are paying more to balance the city’s books.

City staff say the tax rate for non-residential buildings in Edmonton is more than double the rate in the rest of the region.

“(Businesses) pay more and then they say, ‘I can literally get a better deal across the street,’ whether it’s in Acheson or Leduc County or Strathcona County or Sturgeon County,” said Sarah Hamilton, councilwoman of Ward Sipiwiyiniwak, on steps that create a “spiral that puts pressure not only on the non-residential sector, but also on the residential sector.”

“I think everyone is feeling it now.”

The city is working on a strategy to reverse the trend. In the short term, this will likely involve connecting vacant industrial land to utilities and speeding up the permitting process, but it could take decades to reclaim the lost land.