A prime 5.13-acre greenfield site in Langley, B.C. will finally be developed after being acquired last year by a local man who operated a business beside it for decades.
John Tilstra founded window and door manufacturing company Centra Construction Group some 35 years ago. He sold it two years ago to form Wesmont Properties, in which he and his three sons are each 25 per cent partners. John is the chief executive officer, while Sean is vice-president, Nick is chief financial officer and Joel is general manager.
John Tilstra has decades of experience in construction, development and property management. He’s also the founder, president and majority shareholder of Silverwynde Properties Inc., a holding and property development company launched in 1988.
All of that experience will come in handy for Wesmont’s first industrial development, Wesmont Centre. The site at the corner of 62nd Avenue and 203rd Street was acquired in February 2020 for $16.5 million.
Long quest for Wesmont Centre land
Tilstra told RENX he had asked the former owner a dozen times over 30 years if he could buy the empty land, but he always received a negative reply. The property eventually went on the market, however, and Wesmont was the top bidder.
It now plans to add badly needed industrial space to the Langley market.
Development has sprouted up all around the area and Tilstra says the site provides businesses with excellent corporate branding opportunities and access to local amenities and shopping.
The flex strata project will include 119,887 square feet over three buildings of small-bay warehouse space, with units starting at 3,615 square feet. There will be on-site parking and the units will have 26-foot clear heights and grade-level loading doors.
All units will include pre-built mezzanines, glazing, bathrooms, an enclosed stairwell and a combination of front office/rear-loading and front office/front-loading layouts. Zoning allows for a variety of prospective buyer types, including warehousing, wholesale, service industrial, light manufacturing, accessory, retail and office.
Strata development maximizes returns
“During the pandemic, because the supply chain has been so disrupted, a lot of the trades and small businesses need to store more product to get it out to consumers and clients,” said Tilstra.
The first eight units went on sale for $445 per square foot in early April and seven have already been sold.
“From a financial returns perspective, a strata development pro forma is significantly more profitable than a lease pro forma in this market,” Avison Young principal for industrial properties Garth White told RENX.
White said 90 per cent of potential buyers who made offers on the property wanted to do strata development. The other 10 per cent were owner-occupiers looking to build their own facility.
“That was the only way you could make sense of the purchase price,” said White. “Nobody looked at this property as one to buy and lease.”
Delivery for Wesmont Centre is anticipated in the second quarter of 2022.
Wesmont Centre will also include a 1,385-square-foot two-bedroom, two-bathroom live-work suite with a fireplace and air conditioning that would work well for creative users or retail gallery owners. Tilstra liked the concept because he believes having someone on site at night will add an additional level of security to Wesmont Centre.
The Langley industrial market
This will be the first such development in the community in more than 20 years and it’s estimated the businesses it will house will generate more than 170 jobs.
Langley’s industrial vacancy rate was 0.6 per cent in the first quarter of 2021 and the Metro Vancouver rate was only slightly higher at 0.9 per cent. The regional vacancy rate has been below two per cent since 2016.
“Over the last couple of years, we’ve seen lease rates appreciate seven to eight per cent per annum and a lot of businesses are looking at the strata market to control their cost structure,” said White.
“It’s a bit of a perfect storm, with COVID boosting a lot of industrial businesses’ revenues, cheap debt, lack of product and people wanting to control the cost structure.”
Future Wesmont industrial developments
Elsewhere, Wesmont plans to start building Wesmont Yale Centre on a 2.5-acre site at 44431 Yale Rd. in Chilliwack, B.C. next year. It will be another small-bay building with approximately 3,500 square feet of space per unit. Tilstra hasn’t yet decided if the units will be sold or leased.
White said the Chilliwack industrial market is similar to Langley’s and hasn’t had a new project come up for quite a while, so he expects Wesmont Yale Centre to also be well-received.
Wesmont also plans build a 40,000-square-foot industrial building, which will be available for lease, in Abbotsford in two years.
Abbotsford was traditionally mainly a local market, but over the past few years it has become more of an option for national companies servicing B.C.’s entire Lower Mainland, according to White.
Other Wesmont projects
Wesmont has three residential developments at various stages:
– Ridgemont, a community of 50 single-family homes near 74th Avenue and 197th Street in Latimer, in the Township of Langley, that’s coming this fall;
– Wedgemont, a 38-townhouse complex in Latimer that will begin construction this fall;
– and at 18599 74th Ave. in Surrey, which is planned for 2024.