The Properties Vertical at Qualico: Nearly 70 Years in the Making
Qualico Through the Decades – 2010's
First, a Short History Lesson
The history of Qualico is one of innovation, imagination, and finding creative solutions to problems. Even today, the introduction of new business verticals—most recently, the Properties vertical—carries on a legacy of future-forward thinking and the drive to innovate.
There is no better example of determination and business pioneering than the legacy of Katherine Friesen: co-founder of Quality Construction and founder of Rancho Realty.
In the late 1940s, David and Katherine Friesen came up with a plan that would allow the couple to have a family and afford the purchase of their first home. There was a great need for housing after the war, so Katherine decided that her husband would build homes. The Friesens bought seven lots in Winnipeg’s River Heights neighbourhood, where David took the lead to plan and build seven homes.
Then, it was up to Katherine to sell them.
And sell them she did. Using the commissions from those first seven sales, Katherine bought a new fur coat. When her husband learned that Katherine’s extravagant purchase had been bought with money from selling homes, he suggested that she start her own realty company. This was the beginning of a great partnership with her husband, and Katherine’s strong business sense led to the creation of the Rancho brand through Rancho Realty.
Katherine Friesen's Rancho Realty Business Cards
Introducing Property Management
Building upon the foundation laid by Katherine Friesen’s Rancho Realty, Qualico’s Properties vertical culminates a rich history that, alongside property management, also includes commercial development, leasing, income properties, and merchant building. While it’s hard to nail down exactly when Qualico had its first foray into the property management business, it’s likely that the venture followed the Friesen model of integration.
During the 1970s, Qualico’s acquisition and ownership of income properties necessitated a solution for property management. Rather than relying on a third party to manage commercial and multi-family developments, Qualico introduced property management services under the Rancho brand name, allowing for more control of business assets and, ultimately, the fate of those developments—a method of business integration that Dr. Friesen championed.
The forward-thinking decision to take on property management in-house is still paying off. Rancho’s move into the number four spot of Canadian Property Management’s Who’s Who list in 2019 is a testament to sound integration decisions.
Rancho Realty Brochure Ads in the '80s
Today, the Rancho brand name has evolved from the selling arm of Quality Construction and has become synonymous with property management. Rancho has operations across Western Canada, with over 1,700 residential rental apartments, more than 40,000 condominium units, and 3.6 million sq. ft. of commercial space. Katherine’s entrepreneurial drive carries through to today, guiding the vision and growth of Qualico’s newest Properties vertical.
Property Management and Commercial Leasing
In the late 1970s and early 1980s, Qualico’s business portfolio included several income properties—almost all of those being apartment rentals. However, the mid-1980s market crash saw developers fighting for survival and led to most of Qualico’s previous investments being sold off. In the wake of the ’80s market crash, however, Builders Park in Calgary, Alberta would grow to become a shining example of Qualico’s commercial portfolio and how anticipating needs for mixed-use/industrial space in an ever-changing landscape can lead to growth, even in times of uncertainty.
The Builders Park retail development started off as a $20,585 investment in 1956. Qualico’s Calgary office purchased the 4.8-acre site and soon constructed a prefab plant and office there. While the land was once the subject of a grand revitalization plan to build high-rise office buildings (a project that never came to fruition), today, Builders Park still houses the offices of most Qualico business units in Calgary.
Builders Park was the springboard that launched other commercial development projects in Calgary, Edmonton, and Red Deer, which integrated an understanding of future retail needs and community development plans.
With a strong precedent for working in collaboration with community developers in Western Canada, Qualico’s first manager of Commercial Development and Commercial Leasing, Doug Porozni, paved the way for successful property development projects across Alberta.
After kickstarting the Builders Park project, several other commercial leasing opportunities followed under Doug’s dynamic leadership. Qualico’s in-house commercial leasing teams focused on collaborating with community developers to provide a mix of tenants and services that would complement the overall amenities that members of communities across Western Canada would come to expect.
The success of Qualico’s commercial development and commercial leasing ventures carries through to this day, building on the lessons learned, along with an ever-expanding portfolio of investment properties and property management opportunities.
Qualico's US Multi-Family Products
Qualico’s US multi-family program is the youngest component of the Properties vertical. In the United States, this program reaches back more than ten years and features Qualico-owned income properties and joint-venture multi-family merchant building developments. The majority of the merchant building programs feature the long-standing business partnership between Qualico and Ledcor.
Within the Qualico Properties portfolio are income properties such as The Village at Gracy Farms in Austin, as well as the newest addition, The Quest—a 333-unit mid-rise building located in the popular northwest suburbs of Austin.
Managed through the US regional offices in Austin, Texas, the merchant building program includes a collection of new and mature projects. The Lakes at Techridge in Austin, Texas is the largest merchant building development to date in the US.The six-phase, 126.5-acre project includes multi-family rental and commercial units in the heart of Austin’s technology sector. Meanwhile, in California, Shoreline Gateway features luxury apartments and retail services with a 360-degree view of Long Beach, Catalina Island, and downtown LA.
In the San Francisco Bay Area, construction on The Grand at Hercules Bayfront is underway. This 232-unit building with a mix of apartment and townhome suites will offer a dynamic and impressive waterfront community, with development projected to extend through 2027.
The most recent US multi-family addition to Qualico’s merchant building program is Starlight.
Starlight - Renderings and Framing Stages as of October 2021
Starlight is a four-storey, 325-suite apartment building located on 2.3 acres of land in Austin, Texas. The property targets young professionals and families who are attracted to the intersection of Manor Rd. and Alexander Ave. in the East Austin neighbourhood. Starlight is a product that follows a proven success model of similar multi-family projects in the area by offering the desired product of studio, one- and two-bedroom suites, accompanied by the desired property amenities.
Across the United States, innovative and beautiful multi-family projects fill Qualico’s dynamic portfolio of opportunistic short- and long-term investments.
Qualico's Income Property Hall of Fame
At the heart of Qualico Properties’ growth is the passion and business acumen of Ron Reimer. Originally hired by Dr. David Friesen himself in 1977, Ron’s career at Qualico has culminated in his appointment as Executive Vice-President in 2004. Ron’s experience and knowledge of the history leading up to the formation of Properties helps give some perspective on the projects that made the vertical what it is today.
We asked Ron to highlight three iconic properties in Qualico’s history and explain their significance.
#1: That Plain Suburban Office Building Known as “2735-39 Avenue”
One of Qualico’s most impactful commercial projects, which Ron notes as a major source of viability for Qualico Properties in today’s market, is an office building at 2735-39 Ave. NE in Calgary, Alberta. Don’t let its simple façade fool you; this project represents more than $2 billion in successful real estate developments.
The importance of this property is that it was the first joint venture between Qualico and Ledcor. The joint-venture business opportunities that would continue after this success would include many of the US multi-family projects and EPCOR Tower.
2735-39 Ave. was redeveloped in 1996 and was then leased out to Calgary Co-op. To this day, Qualico still owns 50 per cent interest in this property.
You might consider it Qualico Properties’ lucky penny.
#2: Welcome to Red Deer, Welcome to the Big Leagues
Qualico’s commercial development and leasing vertical climbed to even greater heights in the 1990s with the Southpointe deals in Red Deer, Alberta. What started as a joint venture with Ledcor for the first two phases of the commercial centre turned into a sprawling project.
Up to this point, the leasing clients at many of Qualico’s commercial properties focused on local or regional independents. What the ‘big box’ project of Southpointe meant was starting leasing relationships with large, national, and North American tenants. Development and leasing partnerships at this scale catapulted Qualico into what was considered at the time ‘the big leagues’.
The Southpointe Common, Southpointe Junction, and Southpointe Plaza deals laid the groundwork for Qualico Properties’ staying power, building up a big-ticket leasing portfolio and showcasing the competitive advantage that the vertical boasts to this day.
#3: Building Edmonton’s First Master-Planned Downtown Community
In Edmonton, Alberta, EPCOR Tower stands as one of the city’s most distinctive buildings, and the tallest building Qualico has ever been a part of as a company in Western Canada. The 28-storey tower is an adaptable, timeless building that set a new standard for downtown development when it was constructed in 2011. More important than EPCOR Tower’s striking posture and award-winning design, however, is the impact that the development had on Qualico’s position as the developer of the first master-planned downtown community: Station Lands.
On over 9 acres of land in downtown Edmonton that was previously a CN railyard, Station Lands will eventually house 2.5 million sq. ft. of developed space, including office, high-rise residential, retail, restaurant, and entertainment space. The first phase of Station Lands’ development began with the keynote EPCOR Tower project: a masterclass on innovative building and sustainability systems. While there is still a lot of work ahead for Station Lands, the first master-planned downtown community will have a major impact on the City of Edmonton—something that Ron says is worth celebrating.
EPCOR Tower and Station Lands prove Qualico’s experience developing master-planned communities and a willingness to meet the needs of those who live and work in them.
Station Lands Renderings - A Master-Planned Downtown Community in Edmonton, AB
A Bright Future
With over 3 million sq. ft. of office, residential, retail, and industrial space in major centres across Western Canada (and 5 million sq. ft. of development projects still in the pipeline), the Properties vertical is firmly set as a strategic and consistent contributor to Qualico’s integrated real estate model. With about 10 to 15 years of land supply in the vertical, this presents a value upwards of $4 billion.
Qualico's Sage Creek Community in Winnipeg - North Village Site
For Mike Saunders, Senior Vice-President of Qualico Properties, the consolidation of regional leasing, development, property management, and assessment management expertise into a single national business aligns their processes and culture to helps better understand clients’ needs. “That is, I think, our biggest strength,” said Mike. “We can adapt to market conditions better than anyone else because of our vertical integration. Whether it’s commercial or multi-family, we can morph and adapt to meet the needs of communities.”
Qualico Properties is the continuation of a rich history of leasing and development reaching back to the entrepreneurial spirit of Katherine Friesen and Rancho Realty. A decades-long commercial and multi-family property management and investment portfolio cultivated by industry greats has paved the way for future growth.
Capitalizing on opportunities and morphing to meet the needs of communities and build business is illustrated in the three commercial property hall of famers. The office at 2735-39 Ave. NE in Calgary was just the beginning of Qualico Commercial’s aspirations and was the start of a 25-year relationship with Ledcor.
If not for the Southpointe deals in Red Deer, it’s hard to say whether Qualico’s commercial developments—or even the full Properties vertical, including third-party condo management services, for that matter—would have come as far as they have today.
And with its sights set on innovation and building better cities, Station Lands will be a banner project for Qualico Properties. Without a doubt, the national approach of Qualico Properties and Rancho’s top spot in Canada for third-party condo management underscore Qualico’s proven position as a market leader in the real estate industry.
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