A glimmer of hope has appeared for Calgary’s beleaguered downtown office market with the leasing of 80,000 square feet of space to a technology company in the new TELUS Sky mixed-use tower.
Absorb Software, a learning technology company, will be taking office space in the 60-storey skyscraper in the heart of Calgary which is expected to officially open at the end of this month.
News of the lease comes at a time when Calgary’s downtown office market continues to experience an historically high vacancy rate of about 25 per cent – an elevated rate which it has struggled with for some time following the oil price collapse that began in the latter half of 2014.
Roz McQueen, a leasing executive at Westbank, developer of TELUS Sky, in partnership with Allied Properties REIT and TELUS, said Calgary is poised to become a significant tech hub in Canada. The new skyscraper is designed to meet and exceed the expectations of the city’s growing creative and technology sectors.
“Stars aligned” to facilitate Absorb lease
Not only will TELUS Sky be Absorb’s new workplace, it also has the potential to be a home for the company’s international talent through the project’s furnished short- or long-term residential units.
“As a landlord, as our building is about to open, the stars totally aligned to have this,” said McQueen during an interview with RENX.
TELUS Sky has 440,000 square feet of office space, 10,000 square feet of retail and 326 residential rental units from the third to 58th floors.
“We secured the dream tenant with Absorb,” said McQueen.
“This fulfills the creative economy local to Calgary and a positive news story – a true absorption story where the tenant has naturally grown over the past 17 years in Calgary and now is making a statement with its location at TELUS Sky.”
The layout of Calgary’s Telus Sky
The uniquely designed building includes the first three floors of retail space. Floors four to 28 are for office use; the 29th floor is mechanical; floors 30 to 58 are residential; and the top floors – 59 and 60 – will be office space dedicated to TELUS executives.
“Calgary has been a great home for Absorb, and since our business has grown so rapidly in recent years, it was time for us to move into a location better-suited to accommodate our current team and anticipated growth,” said Absorb CEO Mike Owens in a statement.
“We’re thrilled we can remain in the area while we continue to expand and deliver the industry-leading solutions to our customers.
“Moving to this unique and impressive tower — a transformative landmark for the city — will not only provide Absorb with the tech-focused amenities necessary to support the company’s ongoing expansion, but help us attract and retain the best talent.”
Absorb has offices in London, Dublin, Shanghai, Sydney, Boston, Tampa and Salt Lake City.
Home-grown success story
Dan Harmsen, vice-president, associate broker, principal, of Barclay Street Real Estate Ltd., who represented Absorb in the transaction, said the company is a true representation of a home-grown tech success story, which started in the mid-2000s in a garage in Calgary’s northeast and has grown exponentially since.
“Planting their flag in Calgary as opposed to relocating to assumedly better locations in Canada or the States, Calgary provided less expensive business occupancy costs and significantly more affordable housing and living costs for their valued employees,” said Harmsen.
“This is a perfect example why we believe Calgary has a great long-term economic future.”
TELUS Sky was designed by global architectural firm Bjarke Ingels Group (BIG) and is projected to be a LEED Platinum certified building. The lobby features a living green wall and 11-storey atrium.
Absorb will occupy five levels of open-concept workspace with balconies on floors 20 and 22-25 and have access to the wellness centre and health-food concepts in the building.
Telus Sky now 60 per cent leased
McQueen said the latest transaction brings the commercial space of TELUS Sky to 60 per cent leased with five commercial tenants. This includes TELUS which will take up about 140,000 square feet, representing about 33 per cent of the space.
“We are happy to share that Deville Coffee will have a café on the ground floor including a coffee blend unique to TELUS Sky,” said McQueen.
“We are also in discussions about a 7,500-square-foot fitness/wellness centre which will include group fitness classes such as boxing, barre and bootcamp and massage therapy/chiropractic services.
“Further, discussions are underway for a 1,000-square-foot progressive, modern health food space including a smoothie bar, bowls, salads, and more.”
The residential rental units consist of 63 studio suites, 172 one-bedroom units, 12 one-bedroom units plus den, 42 two-bedroom units, 27 two-bedroom units with two baths, and 10 three-bedroom units.