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Environmental
Design and
Management
Limited

Land Use Plan &
Re-development
Strategy

 
 


5.2.2


Future Industrial Absorption Rates

 

 

Predicting future absorption rates for industrial land in CBRM is difficult, as past activity was influenced in part by government tax incentives (e.g., Northside Industrial Park). In general, land sales are highly correlated to the overall strength of the economy, and one would expect to see a lot of activity during periods of strong economic performance, and little or no activity during a recession. Assuming the local economy experiences slow, but constant growth over the coming decade (2002 to 2012), this could translate into approximately 100 acres in land sales.

Taken in this context, the 445 acres of industrial land at SYSCO represents a 45 year supply of industrial land, in addition to the 16 year supply of serviced land that already exists at the three other industrial parks in CBRM (a 61 year supply). However, the reality is that due to the existence of existing infrastructure on the SYSCO property (wharf, buildings, etc), these assets may entice new users to the area that might otherwise not come to CBRM. In addition because the SYSCO site evolved over time, its layout is not as efficient as a greenfield site, therefore future absorption rates will tend to be higher, resulting in less efficient use of the land area. The recent lease to PEV of 90 acres of land is a case in point.

It is expected that land associated with key portions of infrastructure on the site (wharf, buildings, etc) will lease fairly quickly if priced appropriately. This should consume a large amount of land relatively quickly. Once this initial activity has occurred, the leasing of the remaining lands will fall back to a rate that more closely approximates absorption rates seen in CBRM during the 1990’s, although these rates should be elevated slightly due to the expected increased strength in the local economy, and because of synergies created by new tenants such as PEV. Not including the lands associated with the lease, it is estimated that the total CBRM industrial market will absorb 10 acres per year over the next decade, with the SYSCO site attracting 40% of this investment (4 acres per year).

There has also been some discussion within CBRM of the potential to use the former Cove Ovens property for industrial use. At just over 140 acres in size, this site would add an additional 15 to 20 year supply to the local industrial land market. The distance of this property from the SYSCO wharf (one of the stated reasons to reserve this land for industrial use) reduces its value for industrial use.

From a community planning perspective, given the past industrial nature of the site, and the overwhelming existing supply of quality serviced industrial land, it would appear reasonable to look for other uses for this site that are more compatible with the surrounding neighborhoods


 
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