Competitiveness Study... · Web viewThe City of Leduc has great potential to continue to benefit from the Province of Alberta`s rich natural resources and general economic prosperity

City of LeducEconomic Development Competitiveness Study – FINAL REPORT

December 9, 2011

1 Millier Dickinson Blais: City of Leduc Draft Report: Economic Development Competitiveness Study

ContentsEXECUTIVE SUMMARY.......................................................................................................................................... 1

1 INTRODUCTION............................................................................................................................................... 7

1.1 OBJECTIVES OF THE STUDY 71.2 REPORT STRUCTURE 71.3 HOW CITY POLICIES ALIGN WITH ECONOMIC DEVELOPMENT 8

2 LEDUC’S CURRENT ECONOMIC POSITION.................................................................................................11

2.1 INDUSTRY SECTOR GROWTH AND FUTURE OPPORTUNITIES 112.2 BUSINESS AND COMMUNITY STAKEHOLDER CONSULTATION FINDINGS 14

2.2.1 Community Vibrancy................................................................................................................142.2.2 Transportation Hub...................................................................................................................152.2.3 Importance of the Airport.........................................................................................................152.2.4 Partnerships and Alliances........................................................................................................162.2.5 Clarity of Roles and Responsibilities.........................................................................................162.2.6 Economic Development Alignment...........................................................................................17

2.3 BUSINESS PROFILE 17

3 REGIONAL COMPETITIVE ANALYSIS...........................................................................................................28

4 INDUSTRY-SPECIFIC COMPETITIVE BENCHMARKING..............................................................................39

4.1 SITE SELECTION CONSIDERATIONS 394.2 KEY BENCHMARK INDICATORS 44

4.2.1 Oil and Gas Related Sector.......................................................................................................454.2.2 Multimodal Logistics Sector......................................................................................................494.2.3 Lone Eagles..............................................................................................................................524.2.4 Agri-Food Sector.......................................................................................................................56

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4.2.5 Hospitality/Tourism Sector........................................................................................................59

5 SWOT ANALYSIS............................................................................................................................................ 62

5.1 LEDUC SWOT ANALYSIS - GENERAL COMMUNITY 625.2 LEDUC SWOT ANALYSIS - INDUSTRY SPECIFIC 64

5.2.1 Oil and Gas Related Sector.......................................................................................................645.2.2 Multi-modal Logistics Sector.....................................................................................................655.2.3 Lone Eagles..............................................................................................................................665.2.4 Agri-Food Sector.......................................................................................................................675.2.5 Hospitality/Tourism Sector........................................................................................................68

6 LEDUC’S COMPETITIVE ADVANTAGES AND DISADVANTAGES.................................................................69

6.1 GENERAL COMMUNITY 696.2 SECTOR SPECIFICALLY 70

7 ECONOMIC DEVELOPMENT SERVICES DELIVERY....................................................................................72

7.1 WHAT IS ECONOMIC DEVELOPMENT? 727.2 LEDUC’S ECONOMIC DEVELOPMENT ‘SANDBOX’ 73

7.2.1 How Other Municipalities Work in a Multi-Jurisdiction Setting...................................................757.3 CITY’S ROLE: DO NOTHING? NOT RECOMMENDED. 777.4 LEDUC’S RESPONSIBILITIES / SERVICE GAP ANALYSIS 77

7.4.1 Model for Investment Attraction Service Delivery.....................................................................827.4.2 Best Practice Business Retention and Expansion Initiatives.....................................................877.4.3 Characteristics of Great Business Visitation Strategy...............................................................89

7.5 STRUCTURE – CHARACTERISTICS OF STRONG MODELS 977.5.1 Fit into Staff Organization.........................................................................................................977.5.2 Relationship to Regional Organizations....................................................................................977.5.3 Response Teams for Investment Attraction and Investment Retention....................................977.5.4 Human & Financial Resources Requirements...........................................................................97

7.6 PERFORMANCE MANAGEMENT 99


7.6.1 Providing Top-Notch Service.....................................................................................................997.6.2 Return on Investment – Jobs and Taxes..................................................................................101

8 CONCLUSION............................................................................................................................................... 104

APPENDIX A – LIST OF STAKEHOLDERS.........................................................................................................105

APPENDIX B – ZONING FLEXIBILITY................................................................................................................107

APPENDIX C – SITE SELECTION MATRICES....................................................................................................118

APPENDIX D – CITY OF LEDUC AND LEDUC COUNTY COMPETITIVENESS COMPARISON.......................123


Telford LakeLeduc Business Park *

* All photos in document courtesy of the City of Leduc

Executive SummaryThe City of Leduc has great potential to continue to benefit from the Province of Alberta`s rich natural resources and general economic prosperity. Alberta`s abundant natural resources that include the oil sands, the second largest proven oil deposit in the world, will help propel population and employment growth in the province`s foreseeable future. In the past, Alberta has also seen strong gross domestic product (GDP) growth across many industries outside of the oil and gas industries. The economy is diversifying, which is crucial for sustaining a stable economy. In addition, the provincial government is in a strong financial position compared to other provinces in Canada and American states – making it an appealing market for business investment.

Study Objectives

The City of Leduc Economic Development Competitiveness Study will support the City’s efforts to attract more non-residential business investment. More specifically, it will:

Assess the city`s competitiveness in non-residential development Identify non-residential attraction and retention targets Make recommendations on whether or not the City should take a more active role in economic development services

delivery and, if so, what the City’s priorities should be including support for business retention and expansion.

Study Methodology

This study was informed by extensive analytical research regarding key sectors and regional competitiveness, a stakeholder engagement process, benchmark indicators for business attraction and best practices research for economic development services delivery.

Recommended Business Growth Sectors

Leduc has specific opportunities in five core business areas: oil and gas related activities, multimodal logistics, agri-food, hospitality/tourism and generally, the self-employed small business operator. Currently, the first four business areas constitute one-third (33%) of all businesses in Leduc and the self-employed businesses constitute over 1,100 (51%) of the nearly 2,200 businesses in Leduc.

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Oil and Gas Related Industries: The City should focus its business attraction efforts towards generating new business in high value added services, such as architectural, engineering and related technical and professional services. Doing so will maximize the tax revenue and employment impact of Leduc’s scarce land resources and these types of uses are a stronger match with the vision of the city projected by business and community leaders. New investment will be attracted to Leduc for a couple of main factors: the immediate region has one of the largest existing concentrations of firms in this sector anywhere in North America and a highly skilled labour force with access to a network of colleges and universities.

Multi-modal Logistics Sector: Growth has not been strong in this sector and competing against other communities with well-established land-based multi-modal sectors is not the best option for Leduc. In addition, as mentioned above, the near term available industrial land base is small compared to other municipalities and the costs are higher which is not conducive to this land intensive business. Leduc is best served to focus on the technical and professional logistics aspects of the industry which are more office based. Over the longer-term, the city should continue to pursue the Port Alberta and Aerotropolis projects which have tremendous upside for the city – either hosting significant development or receiving the indirect benefits of neighbouring communities that host the primary areas of development.

Agri-Food Sector: The number of food manufacturers or wholesalers is small; however, there are no capacity concerns for municipal water and sanitary sewer which highlights some specific opportunities for larger developments. However, the most likely investment targets are small- to medium-sized firms where the owner is looking to access 1.5 million people in the regional consumer market. In particular, Leduc’s Agri-value Business Incubator is a unique and underutilized asset which has specialized staff that can facilitate business expansion in this industry.

Hospitality and Tourism Sector: The Leduc Recreation Centre is a significant asset which is actively being leveraged by City staff and Council to bring more tourism revenue to the community. However, this sector lacks depth of tourism product (e.g. there are few arts, recreation and entertainment businesses) and offers few reasons for visitors to extend visits to Leduc. Pleasure based tourism will continue to be low unless major attractions are identified and built. However, there is also the notion of significant missed opportunity – there are over 2,000 hotel rooms (largely filled by business visitors on expense accounts) and high traffic volumes on Highway 2, but a very low number of restaurants and entertainment venues. With a concentrated effort on selling the downtown revitalization plan, capitalizing on these hospitality/tourism opportunities can also benefit the downtown.


Independent Businesses (Lone Eagles): Lone Eagles are small business operators who generate 75% or more of their income from outside the local area. As such, they are significantly mobile and can live wherever they want. Many of them are fleeing large urban environments and seeking better places to live. They are found in all business industries, but many of them are concentrated in professional, scientific and technical services, construction and real estate. Growth in the number of Lone Eagles complements the city’s goals of attracting a larger population base. However, at the same time, they build a sense of community because they locate their businesses locally as well, searching out small commercial spaces and entrepreneur social networks.

Economic Development Services Delivery

Economic development programs are meant to increase wealth in the community so initiatives should be directed to export development (primarily; by bringing new money into the community) and improving import substitution (secondarily; by keeping money circulating in the community longer).

In order to identify whether or not there are gaps in economic development services delivery, the report examined the core responsibilities of all organizations in the Leduc area that have a role to play in economic development. Complicating matters is the fact the City of Leduc operates in a multi-jurisdictional environment with the Leduc-Nisku Economic Development Authority and Greater Edmonton Economic Development Team. As such, the consulting team examines how other municipalities perceive their roles within this same structure.

Following this discussion, the following recommendations are presented for the City of Leduc’s consideration.

Based on the importance that community and business leaders are placing on increasing tax assessment and job growth, the City should not ignore the role it can play in improving the situation. This is not to say that the existence of a Leduc economic development office would guarantee these results. However, an adequately funded and professionally-staffed economic development office would be Leduc`s best bet to deliver increased economic growth. Implemented properly, the introduction of a city-level economic development office can help Leduc-Nisku EDA initiatives to be more successful while taking local grassroots initiatives to new heights.

Overall, there are plenty of opportunities for growth and existing barriers to economic growth that warrant a proactive economic development effort. The City’s economic development function should not duplicate existing economic development functions. As described below it will complement existing City responsibilities and the work of other economic development stakeholders that are effectively delivering on their responsibilities. The following table describes existing gaps and suggested City responsibilities.


RECOMMENDED DELIVERY OF ECONOMIC DEVELOPMENT SERVICES

Service Existing Gap? City Core Responsibility?

Tourism Product Development: Hospitality/Tourism Investment Attraction

Yes Primary

Investment Attraction: Downtown-related Yes Primary

Business Retention & Expansion Partially Primary (as it supports above)

Investment Attraction: Professional services related to oil and gas, agri-food, transportation/logistics

Partially Primary (support to EDA)

Infrastructure and Planning: Aerotropolis, Port Alberta No Secondary

Investment Attraction: Lone Eagles Partially Secondary

Small Business Assistance Partially Secondary

Tourism Marketing No Yes (agriculture/sport tourism office)

Labour Force Development Yes No

At this exact point in time, it is difficult to make recommendations on exactly how the City should complement the services of the Leduc-Nisku Economic Development Authority because it’s organizational review has just been completed and it has not officially presented to the City the roles it wants to play. Given past experience, the Economic Development Authority should remain the lead on regional investment attraction marketing and lead generation/qualification as it pertains to industrial sectors. However, as described above, there are other opportunities that the City should be trying to capitalize upon. These are:

Investment attraction in the hospitality and tourism sector – leveraging Leduc’s cluster of hotels into more commercial development, restaurants and entertainment venues

Downtown-specific investment attraction to generate interest from the private sector in revitalization plans outlined in Leduc’s new downtown plan


Business retention & expansion initiatives that allow the City to play a stronger role in supporting existing businesses in the hospitality and tourism sector and those that are downtown to ensure growth stays in Leduc.

With respect to infrastructure and planning the City should continue to lead and participate in discussions that encourage development and shape Aerotropolis and Port Alberta

In attracting Lone Eagles the City can shape community messaging for existing and future residents regarding the benefits of being located in Leduc

To assist small businesses more generally, the City should make efforts to have a stronger Community Futures presence in Leduc.

Investment attraction in the industrial sectors (primarily oil and gas, agri-food and transportation/logistics) will remain a role of the Economic Development Authority, but the City can assist them in doing their job to ensure benefits come to the city with the following focus:

Emphasizing that the Economic Development Authority’s target markets need to include professional and technical services related to all three sectors if they are going to meet the City’s needs

Supporting their efforts by preparing competitiveness data that can be used in sales tools Building value propositions based on the city’s general and sector specific competitive advantages Knowing the investment assets that the city has including the availability of industrial lots, its readiness

for development and the desired types of investments.

The City’s economic development form needs to fit into the existing staff organization with a strong title that will allow easier introductions and networking with senior level private sector executives. It will be important for the initiative to liaise with regional organizations and influence the regional economic development agenda.

An effective way to ensure the City responds to the standard that its investment prospects and existing businesses will appreciate is to create response teams that include staff from the City’s main departments as well as important external agencies (e.g. utilities and labour force experts).

The following guidelines are recommended when allocating human and financial resources to the initiative. Economic development is:

a separate line item in the City budget viewed as an investment, and not as an expense staffed with two full-time positions (i.e. Senior Manager and Economic Development Analyst)


meant to leverage funding from senior levels of government given an annual budget of $395,000 to operate given the outlined responsibilities.

The report suggests a couple of important performance management systems including a model for measuring return on investment that should not only be used by the City in measuring its impact on investment attraction but the City should also encourage the Economic Development Authority to incorporate the practice.


1 IntroductionThe City of Leduc has great potential to continue to benefit from the Province of Alberta`s rich natural resources and general economic prosperity. Alberta`s abundant natural resources that include the oil sands, the second largest proven oil deposit in the world, will help project population and employment growth in the province`s foreseeable future. In the past, Alberta has also seen strong gross domestic product (GDP) growth across many industries outside of the oil and gas industries. The economy is diversifying, which is crucial for sustaining a stable economy. In addition, the provincial government is in a very strong financial position compared to other provinces in Canada and American states – making it an appealing market for business investment.

1.1 Objectives of the StudyThe City of Leduc Economic Development Competitiveness Study will support the City’s efforts to attract more non-residential business investment. More specifically, it will:

Identify and validate the city`s competitive advantages as they pertain to export-oriented business development Identify whether or not the City should take a more active role in economic development services delivery and, if so,

what the City’s priorities should be including support for business retention and expansion.

1.2 Report StructureMillier Dickinson Blais has structured the report to address each of the project`s key components. The report begins with a review of the City of Leduc’s strategic planning documents and aligns this study’s objectives with the City’s strategic objectives. The remaining sections are as follows:

Section 2.0 – Leduc’s Current Economic Position contextualizes the city’s position within the larger Province of Alberta’s growth industries and future opportunities. This section examines the key themes addressed in the consultations with business and community stakeholders and profiles the business community.

Section 3.0 - Regional Competitive Analysis compares the City of Leduc to other communities in Alberta that are also positioned to attract business investment. Some of the comparators include population growth, residential to non-residential assessment base proportions, available industrial lands, industrial land prices and non-residential tax rates.


Section 4.0 – Industry-Specific Competitive Benchmarking includes the main site selection factors for four industries poised for growth in Leduc. Some of the communities that were compared to Leduc in the previous section are further examined to determine their competitiveness by sector. Metrics that are examined by sector are labour rates, transportation needs and utility requirements.

Section 5.0 - SWOT Analysis examines Leduc’s strengths, weaknesses, threats and opportunities, both generally and industry-specifically.

Section 6.0 – Leduc’s Competitive Advantages and Disadvantages examines the city’s competitive advantages and disadvantages, both generally and industry-specifically.

Section 7.0 – Economic Development Services Delivery explores the concept of economic development, identifies the current economic development players, identifies any service gaps, explores difference delivery models and provides recommendations for the City’s economic development services.

Section 8.0 – Conclusion concludes the City’s economic development competitiveness study.

1.3 How City Policies Align with Economic Development The City of Leduc has multiple policy documents that highlight the City's strategic goals and visions. A fundamental strategic document, the City's Corporate Strategic Plan lays out the goals, visions and directions of the City as a corporation. The priorities highlighted in this Strategic Plan include: economic and tourism development, social wellness, recreation and culture, environment and infrastructure, governance and organizational capacity. Importantly, the City of Leduc highlights their commitment to engaging with multiple partner organizations where the objectives of the partner organization and the strategic plan of the City of Leduc are clearly complementary. When it comes to economic development, the City actively collaborates with the Leduc-Nisku Economic Development Authority (EDA), Leduc Regional Chamber of Commerce and local municipalities in the region.

In terms of economic development planning the Strategic Plan highlights the importance of continuing to work collaboratively with other partners and stakeholders to capitalize on economic development opportunities created by the development of Port Alberta and emphasizing the importance of Leduc's transportation linkages, in particular the Edmonton International Airport.

The Municipal Development Plan (MDP) for the City of Leduc highlights the importance of the City as a transportation hub in the Edmonton Region. The MDP states “at the junction of the Queen Elizabeth II Highway, the Canadian Pacific Railway and the Edmonton International Airport, [the City of Leduc] has become a key transportation crossroads.” The


City of Leduc is committed to investing in the area's infrastructure and public facilities to ensure that growth in the region is sustainable.

In accordance with the City of Leduc's commitment to collaboration and relationship building with local organizations the City of Leduc and Leduc County developed a Joint Sustainable Growth Study. Due to the unprecedented growth in the Edmonton Region there are many regional infrastructure projects underway or planned. These projects include highways, a future high-speed rail and regional public transit systems. These projects are guided by principles of smart growth, creating vibrant communities, environmental stewardship and responsible governance. Overall, the Growth Study emphasizes the importance of continuing to work within regional bodies - including the Leduc-Nisku EDA and Capital Region Board (CRB) to further intermunicipal cooperation and integration of land use planning.

In relation to land use planning, the City of Leduc’s Land Use Bylaw systematically outlines the permit application process, enforcement policies, fees and the land use bylaws of the City. The land use bylaws specify the uses permitted in each land use category as well as building specifications, minimum separation distance policies and policies regarding access to roads. The development officer can grant variance on a number of grounds if the building conforms to permitted uses for the building or land in question, particularly if the proposed development does not interfere with the amenities of the neighbourhood and materially interfere with or affect the use, enjoyment, safety or value of neighbouring properties. There are specific area guidelines including the Downtown Plan, the Highway 2 Corridor and the 50th Avenue/50th Street Gateway Overlay. The general purpose of these overlays is to protect and enhance the integrity of the areas while facilitating greater development.

Another major area specific plan that the City of Leduc has recently undertaken is the Aerotropolis Integrated Land Use Compatibility Plan. This plan provided recommendations and land use concepts for compatible land use on the site, including a consideration of Aerotropolis development principles and potential Port Alberta operations along with strategies for mitigating noise stemming from adjacent land uses. The concept of an Aerotropolis can be defined as the diversification of the airport`s activities and the multiplication of the economic benefits these provide to the city beyond those typically associated with an airport. The plan strategically aligns future land use planning with compatibility and economic viability in hopes of creating synergies in the economy.

Not only is the City of Leduc committed to regional cooperation and strategic land use policies it is also committed to 'place making' and ensuring that the high volume of development currently taking place in the City is consistent with its goals of creating a liveable city. Leduc's Downtown Design Strategy focuses on creating unique and vibrant communities within the City's boundaries and providing superior quality of life to residents. This document outlines basic environmental design specifications for key parts of the City and also outlines the consultation process that should be followed to ensure that citizen input is garnered in developing neighbourhoods and public spaces.


By emphasizing the City’s willingness to work within a regional framework

and provide clear guidelines for future development, Leduc is well positioned to attract investment in

multiple sectors.

These documents highlight the importance the City places on strategic planning and development. They outline the multiple ways in which the City of Leduc interacts with key regional partners. In terms of measuring competitiveness these policies show a clear concern for non-residential expansion, development of strong transportation linkages and balancing these with neighbourhood development that promote a strong sense of community and increased quality of life. By emphasizing the City's willingness to work within a regional framework and provide clear guidelines for future development, Leduc is well positioned to continue to attract investment in multiple sectors.


Leduc Recreation Centre Leduc's Downtown

2 Leduc’s Current Economic PositionThis section explores industry sector growth and future opportunities in the provincial economy. The section summarizes the key themes that surfaced during the consultation process and analyses the sector growth and future business opportunities for the City of Leduc.

2.1 Industry Sector Growth and Future OpportunitiesThe City of Leduc is in a very favourable position to continue to benefit from Alberta’s energy industry and other growth industries. With a (2009) GDP of $247.2 billion, Alberta is Canada`s third largest provincial economy and has the highest GDP per capita.1 The largest percentage of the province’s total GDP is in the energy industry (23.4%). The next largest industries as a percentage of total GDP are in finance & real estate (14.6%), construction (10.6%) and business and commercial services (9.6%). As a percentage of total GDP, these three industries (now totalling 34.8%) have grown considerably since 1985 when they collectively made up 23.2% of GDP.

FIGURE 2.1: ALBERTA’S GROSS DOMESTIC PRODUCT COMPARISON, 1985 VS. 2009

36.1%

23.4%

11.0%

14.6%

6.7%

10.6%

5.5%9.6%

8.1% 9.0%

7.7% 7.2%

6.0% 6.5%3.8% 5.2%3.6% 4.9%4.8% 4.0%3.6% 3.7%3.0% 1.4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1985 2009

Agriculture

Education

Public Administration

Health

Tourism & Consumer Services

Manufacturing

Transportation & Utilities

Retail & Wholesale

Business & Commercial Services

Construction

Finance & Real Estate

Energy

% o

f Tot

al G

DP

Source: Statistics Canada and Alberta Finance and Enterprise.

1 Statistics Canada and Alberta Finance and Enterprise, 2011.


Led by the energy industry, Alberta’s economy is expected to shift from recovery to expansion in 2011 and beyond. Economic growth is forecast to average 3.2% between 2012 and 2014, which is growth that should keep inflation stable at approximately 2% and employment growth stable at approximately 2% year over year.2 Much of this growth is expected to be driven by investment in oil sands development.

There is also strong growth expected in infrastructure, utilities and manufacturing projects. The Alberta Ministry of Finance and Enterprise completes an inventory of major Alberta projects valued over $5.0 million that are planned, underway or recently completed. This inventory identifies over 900 capital investment projects valued at over $188 billion. Sixty percent (59.8%) of the value of the projects are for the oil sands development. A further 10.0% and 7.4% of the value of the projects are directed towards infrastructure and power. There are large project values in several other sectors, as indicated in the following figure.

FIGURE 2.2: INVENTORY OF MAJOR ALBERTA PROJECTS, 2011

Source: Alberta Finance and Enterprise, Inventory of Major Alberta Projects, June 2011.

2 Budget 2011-Building a Better Alberta, Economic Outlook, Province of Alberta, p.112.


Project Sector # of Projects

Value of All Projects ($

Millions)

Percentage Value of Total

ProjectsOil Sands 63 $112,503.6 59.8%Infrastructure 320 $18,897.0 10.0%Power 40 $13,844.2 7.4%Commercial/Retail 69 $8,793.0 4.7%Institutional 127 $8,558.9 4.5%Pipelines 31 $7,583.4 4.0%Residential 89 $4,813.1 2.6%Tourism/Recreation 99 $4,525.9 2.4%Oil & Gas 9 $1,742.5 0.9%Commercial/Retail & Residential 7 $1,567.8 0.8%Other Industrial 7 $1,510.5 0.8%Biofuels 12 $1,436.6 0.8%Telecommunications 2 $656.0 0.3%Manufacturing 4 $641.0 0.3%Mining 4 $445.0 0.2%Agriculture & Related 10 $296.4 0.2%Forestry & Related 7 $266.5 0.1%Chemicals & Petrochemicals 4 $118.5 0.1%Total 904 $188,199.9 100.0%

There is strong growth expected in infrastructure,

utilities and manufacturing

projects.

Of particular interest to the City of Leduc are the expansion projects at the Edmonton International Airport. When construction is completed in 2012, this airport will have the capacity to support more than 9 million passengers and provide more flights to national and international destinations. In 2008, there were 6.5 million passengers.3 The Edmonton Regional Airports Authority has prepared an Area Structure Plan to provide clear direction for the development of the Airport. This Plan designates over 700 hectares of land on the airport property for the development of Port Alberta commercial facilities. Port Alberta is defined as a multi-modal transportation hub that integrates air and surface transportation in one location and provides a large supply of land for industrial and limited commercial uses to host manufacturing, production, supply, distribution and storage of goods. The Port could integrate multi-modal and other logistics facilities from across the Edmonton Region and create substantial opportunities in multi-modal logistics industries.4 While the lands are located in Leduc County, Leduc will receive its share of spin-off non-residential development.

Adjacent to the airport are the Leduc Industrial Park and Nisku Industrial Park, the latter located in Leduc County. The area has more than 30,000 workers.5 A significant share of future industrial equipment and service supply for oil sands projects could come from and be distributed by Leduc/Nisku businesses.6 This provides substantial future growth opportunities for oil and gas related industries in the area.

Freelance professionals, also known as self professionals or ‘Lone Eagles’, are knowledge workers with highly transportable skills, such as writers, analysts, artists, accountants, trades people, sales professionals, manufacturers’ representatives and other advisors. Most live in large cities but many are moving to small cities, towns and rural areas for a better quality of life. An increasing number of urban areas that are near metropolitan cities are considering this approach. In supporting future growth and investment in Leduc, it is essential to understand and support the needs of these professionals. This is particularly relevant in light of existing research and trends which suggest that an overwhelming percentage of new business investment in a community is derived from business owners already located there.

Food processing is Alberta’s second leading manufacturing industry. In 2010, of the $60.1 billion in manufacturing shipments, the food processing industry accounted for $10.7 billion (17.8%), which was one of the few industries that has shown growth since 2007.7 The prospects for food processing growth continue to remain strong as rising energy costs

3 EIA’s Expansion Gears Up. Edmonton International Airport media release, April 9th, 2009.

4 Working Together: Report of the Capital Region Integrated Growth Management Plan Project Team, submitted to Hon. Premier Stelmach & Hon. Minister Danyluk. Chapter 3: The framework for an integrated regional growth management plan, p.16.

5 Jobs figure is based on discussions with City of Leduc staff.

6 Ibid. p.17.

7 Manufacturing Sales by Subsector, by Province and Territory, Statistics Canada, CANSIM Table 304-0015, September 15th, 2011.


Port Alberta could integrate multi-modal and

other logistics facilities from across the Edmonton

Region and create substantial opportunities in

multi-modal logistics industries.

are driving up the cost of transporting and growing food. Centres that can grow food and transport and distribute food close to larger consumer markets should be well positioned to attract food processing manufacturing investment.

An industry growth prospect for the Province of Alberta is tourism. In 2009, there were an estimated $5.4 billion in tourism expenditures. Nearly half ($2.5 billion) of the spending was directed towards accommodation, food and beverages. In addition, over half ($2.9 billion) of the expenditures are from Albertans visiting other parts of Alberta. Nearly $1.3 billion of spending comes from visitors in the United States and other countries. In terms of expenditures, Edmonton and Area and Calgary and Area are the largest tourism regions in the province with over $1.4 billion each in 2009.8 This industry in the Edmonton and Area (i.e. Leduc) has potential to grow as the Edmonton International Airport, a key point of entry for tourists and business travellers, expands its passenger servicing capacity.

2.2 Business and Community Stakeholder Consultation FindingsIn order to gain a greater understanding of some of the key challenges and opportunities facing the city in terms of economic competitiveness, stakeholder interviews have been completed with key individuals in the community who have a well developed understanding of the local economic conditions. In total, over 35 stakeholders were interviewed over the course of the project. The interviews serve to inform the SWOT analysis and strategic recommendations.

In general, six key themes surfaced in the discussions with stakeholders. These themes include: community vibrancy, transportation hub, the Aerotropolis concept, partnerships and alliances, clarity in roles and responsibilities, and economic development alignment.

2.2.1 Community VibrancyReverberating through each of the stakeholder consultations was a general sense of optimism and pride in the past, present and future of Leduc's economy. Many of the stakeholders emphasized that the city has a high quality of life and easily attracts professionals and families to the area. Investments in recreational facilities and programming have increased the quality of life in the city. This along with the emphasis currently being placed on the downtown and the cultural assets of the city will ensure that the quality of life continues to flourish.

8 Government of Alberta. Tourism, Parks and Recreation. June 2011. A Summary of 2009 Visitor Numbers and Characteristics.


Reverberating through each of the stakeholder consultations

was a general sense of optimism and pride in the past,

present and future of Leduc's

In addition, many of the stakeholders noted that Leduc has an international reputation for being welcoming and open for business. There are a large variety of foreign owned corporations currently in operation in the city and international trade missions are regularly conducted by local government representatives.

Community stakeholders emphasized again and again how important it is to remain competitive in the industrial sphere but to not lose sight of the importance of remaining a well-balanced city with continued residential and neighbourhood development.

2.2.2 Transportation HubThe area’s transportation networks offer a significant logistical advantage when attracting business. The rail lines, international airport and roadway infrastructure is extremely important to the development of Leduc's economy. All of the stakeholders interviewed consistently referenced the transportation linkages as a clear strength of Leduc's competitive advantages.

However, there are specific weaknesses to the transportation infrastructure that need to be addressed. Many of the stakeholders advocated for the need for the 65th Avenue interchange. The construction of this interchange would dramatically alter the future development of Leduc's downtown and business park, dramatically decrease the level of large transports driving through downtown and open up the possibility of further developing the lands adjacent to the airport.

2.2.3 Importance of the AirportThe importance of the airport and the economic spinoffs that have been gained due to its location was consistently discussed as being a key economic driver and benefit to the City of Leduc. In fact, the City of Leduc is actively promoting the Aerotropolis concept with guest speakers and workshops. The City has also conducted a land use compatibility study with the airport to fully understand how the city can grow by integrating land use policy with airport development policy. Other key players are also significantly invested in promoting and advancing the Edmonton International Airport. The Airport itself has promoted the Port Alberta plan which would see the airport become a hub of logistics in Western Canada. The City of Edmonton and surrounding municipalities are on board with these advancements of the airport knowing that economic spinoffs will be facilitated throughout the region.


The area’s transportation

networks offer a significant

logistical advantage when

attracting business.

2.2.4 Partnerships and AlliancesA common theme that resonated throughout the consultations was the fact that Leduc cannot be insular looking. The City must continue to look for ways to partner with other jurisdictions and private businesses to ensure the vitality of the local economy.

The City of Leduc is currently engaged with Leduc County through the Intermunicipal Plan to ensure growth in the city and the county are compatible and congruent. Stakeholders continually noted the importance of this relationship as well as other regional partnerships including the CRB.

Private industry partnerships are also fostered by the City. Most notably Leduc representatives are heavily involved in developing the Aerotropolis and Port Alberta concepts with partners in the region.

Many of the stakeholders commented on the importance of the work currently being done by the Leduc-Nisku EDA, the regional economic development organization. A variety of stakeholders commented that the relationship between the City and the EDA is extremely beneficial and allows for better responsiveness to economic opportunities and challenges in the area.

With this being said, it is also important to note that stakeholders commented that greater clarity in the roles and relationships in a variety of these partnerships and alliances would be helpful. Particularly noted was the overlapping responsibilities or gap in service between the City and the EDA in terms of business recruitment and site visits.

2.2.5 Clarity of Roles and ResponsibilitiesThrough the consultation process the need for clarity in the regional and local jurisdictions of economic development was highlighted. Many of the stakeholders commented that the roles and responsibilities of each jurisdiction were unclear and this proved to be challenging in terms of collaboration but also potentially detrimental to the economic welfare of the city. For example, one of the key concerns at the local level was the lack of site selection responsibility within the City. When asked whose role it was to engage with potential investors in site selection discussions and visits it was unclear whose responsibility that was.

Similarly, it was also noted that it was unclear what the mandate of the EDA was and how it could be better utilized by the City of Leduc. It was unclear what reporting mechanisms are currently in place to ensure transparency and clarity and City officials generally did not understand the role in which the broader organizations (further explored in Section 7.0) play in supporting business development at the local level.


Particularly noted was the overlapping

responsibilities or gap in service between the city and the EDA in terms of

business recruitment and site visits.

One of the key concerns at the

local level was the lack of site

selection responsibility

within the City.

2.2.6 Economic Development Alignment Further to the previous theme, many interviewees had questions regarding regionalism and competition. They understood the need to market the broader region as a way to attract investment from outside of the area, but also emphasized the importance of highlighting and positioning the City of Leduc against municipalities in that regional context.

2.3 Business ProfileA detailed review of the business patterns data for the period between December 2007 and June 2011 for the City of Leduc provides an understanding of the growth or decline of businesses over the three and a half year period and the key characteristics that define Leduc’s business community. When combined with the industry sector growth and opportunities discussion, the business patterns information will assist in refining sector opportunities for the City of Leduc.

Understanding the trends in business growth in the city provides valuable insight into the shape that future growth and investment might take. In addition, it provides an indication of where the priorities of the City should lie, especially for marketing and services delivery.

Overall, the number of business establishments in the City of Leduc increased by a healthy 11.3% from December 2007 (1,958 businesses) to December 2011 (2,179 businesses). There has been healthy growth across both self-employed business operations and businesses reporting employees.

In terms of concentration, the following sectors exhibit the highest proportion of business establishments in the City of Leduc in June 2011.

Construction (325 business establishments) Professional, scientific and technical services (251 business establishments) Other services (242 business establishments).

When the indeterminate category (i.e. self-employed) is removed, the three sectors with the highest business establishment proportions are:

Construction (160 business establishments) Other services (150 business establishments) Retail trade (120 business establishments).


The number of business establishments in the City of

Leduc increased by a healthy 11.3% from December 2007

(1,958 businesses) to December 2011 (2,179

businesses)

The following figure also provides an indication of the growth in business establishments by two digit NAICS codes from 2007 to 2011. Those categories that have experienced the highest rate of growth include:

Wholesale trade (50.0%) Accommodation and food services (33.3%) Management of companies and enterprises (29.6%) Real estate and rental and leasing (23.5%).

FIGURE 2.3: CITY OF LEDUC BUSINESS GROWTH BY INDUSTRY, 2007-2011

Source: Statistics Canada, Business Patterns data, 2007 and 2011.


Total % of Total Self-Employed

Businesses with

Employees Total % of Total Self-Employed

Businesses with

Employees11 Agriculture, Forestry, Fishing and Hunting 171 8.7% 127 44 184 8.4% 136 48 7.6%

21 Mining, Quarrying, and Oil and Gas Extraction 60 3.1% 25 35 68 3.1% 33 35 13.3%

22 Utilities 0 0.0% 0 0 2 0.1% 2 0 0.0%

23 Construction 267 13.6% 133 134 326 15.0% 166 160 22.1%

31-33 Manufacturing 73 3.7% 19 54 72 3.3% 20 52 -1.4%

41 Wholesale Trade 62 3.2% 25 37 93 4.3% 26 67 50.0%

44-45 Retail Trade 170 8.7% 53 117 164 7.5% 44 120 -3.5%

48-49 Transportation and Warehousing 140 7.2% 73 67 150 6.9% 79 71 7.1%

51 Information and Cultural Industries 10 0.5% 5 5 10 0.5% 4 6 0.0%

52 Finance and Insurance 79 4.0% 50 29 75 3.4% 50 25 -5.1%

53 Real Estate and Rental and Leasing 170 8.7% 123 47 210 9.6% 155 55 23.5%

54 Professional, Scientific and Technical Services 215 11.0% 109 106 251 11.5% 147 104 16.7%

55 Management of Companies and Enterprises 54 2.8% 39 15 70 3.2% 57 13 29.6%56 Administrative and Support, Waste Management and Remediation Services 79 4.0% 40 39 86 3.9% 46 40 8.9%

61 Educational Services 18 0.9% 6 12 22 1.0% 8 14 22.2%

62 Health Care and Social Assistance 62 3.2% 11 51 67 3.1% 18 49 8.1%

71 Arts, Entertainment and Recreation 21 1.1% 8 13 22 1.0% 9 13 4.8%

72 Accommodation and Food Services 48 2.5% 8 40 64 2.9% 17 47 33.3%

81 Other Services (except Public Administration) 259 13.2% 92 167 242 11.1% 92 150 -6.6%

91 Public Administration 0 0.0% 0 0 1 0.0% 0 1 0.0%

Total Economy 1,958 100.0% 946 1,012 2,179 100.0% 1,109 1,070 11.3%

Industry (NAICS)

December 2007 June 2011% Change

2007 - 2011

According to Statistics Canada Business Patterns Data, Leduc has shown variable growth across five core business areas from December 2007 to June 2011. These areas include (1) Oil and Gas related activities, (2) Multimodal Logistics, (3) Agriculture and Food, (4) Hospitality and Tourism and (5) the Self-employed (or ‘Lone Eagles). Together, the first four business areas constitute one-third (33%) of all businesses in Leduc.

FIGURE 2.4: CITY OF LEDUC BUSINESS BASE, CORE AREAS, BUSINESS LOCATIONS, 2011


Oil and Gas Related: In order to determine the business profile for the oil and gas sector, a value chain assessment was conducted based on the techniques developed by Dr. Edward Feser, the head of the Department for Urban and Regional Planning at the University of Illinois at Urbana-Champaign. In the course of his work on regional economic analysis and


Hospitality &Tourism

4%Multimodal Logistics

6%

Oil & Gas Related 23%

Agri - Food Sector (excluding farms)

1%

Remainder of the Business Base

66%

supply chains, Dr. Feser has done detailed analysis on national level US statistical data related to input/output of sales, in order to develop a measurement of the relative strength of inter-industry linkages. Dr. Feser’s work shows the connection between ‘Core’ and ‘Linked’ Industries. “Core” industries are the specific economic sector being studied. “Linked” industries are either suppliers to the core industry (backwards linked) or purchasers from the core industry (forwards linked).

The average propagation length (APL) is used to note the strength of the industry connection, both forwards (linked industries that ‘purchase’ from the core industry) and backwards (linked industries that ‘supply’ the core industry). Generally speaking, the average propagation length is the average number of steps or time it takes a stimulus in one industry to propagate and affect another industry9. The lower the APL value, the tighter the linkage between a specific industry and the core industry. The relationship is noted by the figure below.

FIGURE 2.5: DR. FESER’S LINKED INDUSTRIES MODEL

It is important to note that this model provides the strength of the industry linkage, but little information about how the industries are linked, or through what products. In some cases, a connecting product or service between the core and linked industries can be assumed based on their core activities. What is missing is an explicit indication of what products or services link different industries, which could be useful when looking at industries with weak relationships.

Dr. Feser’s framework and calculation of APL values was applied to the oil and gas extraction industry to assess the extent the City of Leduc is capturing value along the supply chain for this industry. The following figure shows the closest backward linked industries for oil and gas extraction as well as the relative strength of that industry in the City as defined by the number of businesses.

From 2007 to 2011, Leduc’s oil and gas related sector has shown impressive absolute and relative growth from 397 supplier firms to 475 supplier firms (19.7% increase). The constituent categories that have helped to fuel this growth are:

(1) Support activities for mining, increasing from 54 to 64 firms (18.5%)

9Dietzenbacher, E. and Romero, I. Production Chains in an Interregional Framework: Identification by Means of Average Propagation Lengths. International Regional Sciences Review, 2007


Backward Linked Industry

BW APL Core Industry FWD

APLForward Linked

Industry From 2007 to 2011, this business area has shown impressive absolute and relative growth from 397

supplier firms to 475 supplier firms (19.7% increase).

(2) Specialty trade contractors, increasing from 162 to 205 firms (26.5%)

(3) Architectural, engineering and related services, increasing from 39 to 48 firms (21.2%)

Leduc’s economy is inexorably linked to Oil and Gas related activities with nearly one-quarter of all Leduc based firms directly tied to the industry.

FIGURE 2.6: CITY OF LEDUC OIL AND GAS RELATED SECTOR, BUSINESS GROWTH, 2007-2011

Backward Linked Industries Forward Linked Industries


4-Digit NAICS Supplier Industries

No. Of Businesses

(2007)

No. Of Businesses

(2011)

2131 Support activities for mining and oil and gas extraction 54 64 4-Digit

NAICS Customer IndustriesNo. Of

Businesses (2007)

No. Of Businesses

(2011)

2361 Residential Building Construction 54 59 2212 Natural gas distribution 0 1

2362 Non-residential Building Construction 19 25 3241 Petroleum and coal products

manufacturing 0 02370 Heavy and Civil Engineering

Construction 32 37 2211 Electric power generation, transmission and distribution 0 0

2380 Specialty Trade Contractors 162 2054861, 4862, 4869

Pipeline transportation 2 1

3329 Other Fabricated Metal Product Manufacturing 3 3 5617 Services to buildings and

dwellings 35 37

5324Commercial and Industrial Machinery and Equipment Rental and Leasing

27 21 3251 Basic chemical manufacturing 0 0

3331Agricultural, Construction and Mining Machinery Manufacturing

4 7 3274 Lime and gypsum product manufacturing 0 0

3328 Coating, engraving, heat treating and allied activities 0 0 3253

Pesticide, fertilizer and other agricultural chemical manufacturing

0 0

3339 Other General-Purpose Machinery Manufacturing 3 5 3252

Resin, synthetic rubber and artificial and synthetic fibres and filaments manufacturing

0 0

5413 Architectural, Engineering and Related Services 39 48 Total 37 39

2212 Natural Gas Distribution 0 1Total 397 475

Oil and Gas

Extraction


Multimodal Logistics: The City of Leduc’s business community is in an excellent position to continue to benefit from the proximity to the Edmonton International Airport. The City is part of a supply chain logistics hub for global trade. This sector of the economy includes multi-modal transportation infrastructure (i.e. airport, rail, road, and pipeline), logistics services providers and leading edge companies that drive technological innovations in the sector.

From 2007 to 2011, this business area has had only modest growth of 1.6% from 124 to 126 firms. Truck transportation represents the majority of firms in this area, with 88 of the 126 firms and accounts for all of the growth in the business category. It is notable that the next largest categories of firms are:

Support Activities for Transportation (18 firms) Postal, Couriers and Messenger Services (14 firms) Warehousing and Storage (4 firms).

Each of these categories have each remained constant, showing no growth or decline from December 2007 to June 2011, as indicated in the following figure.

FIGURE 2.7: CITY OF LEDUC MULTIMODAL LOGISTICS SECTOR, BUSINESS GROWTH, 2007-2011

86 88

18 18

4 4

2 1

14 14

0 10

20

40

60

80

100

120

140

December 2007 June 2011

493 Warehousing and Storage

491 + 492 Postal, Couriers and Messenger Services

488 Support Activities for Transportation

486 Pipeline Transportation

484 Truck Transportation

481 + 482 Air & Rail Transportation

124 firms 126 firms


The City of Leduc’s business community is in an excellent

position to continue to benefit from the proximity to the

Edmonton International Airport. The city is part of a supply chain

logistics hub for global trade.


Lone Eagles: By definition a Lone Eagle is someone who generates 75% or more of their income from outside the local area and is mobile. Many Lone Eagles are leaving large urban environments in search of:

An accessible natural environment High quality telecommunications services A place closer to relatives (sometimes means returning “home”) Outdoor recreational activities A safer place to live Employment for their spouse (if applicable).

When Lone Eagles are successful they expand their operations by leasing office space and hiring staff or contracting out work to other Lone Eagles (e.g. sub-consulting, bookkeeping, etc.). The following figure depicts the business establishments that are classified as having no employees (the best available approximation for Lone Eagles). The establishments in the “no employees” category include the self-employed and cottage industries, (i.e. those who do not maintain an employee payroll, but may have a workforce consisting of contracted workers, family members or business owners). In June 2011, over 1,100 business establishments in Leduc were classified as having no employees. The highest numbers of business establishments were in:

Construction (166 firms) Real estate and rental and leasing (155 firms) Professional, scientific and technical services (147 firms) Agriculture, forestry, fishing and hunting (127 firms).

Over the three and a half year period there was growth of 163 businesses (17.2%) with no employees. This growth is high in comparison to other communities across Alberta and Canada. The three industries with the highest absolute growth were in:

Professional, scientific and technical services (+38) Construction (+33) Real estate and rental and leasing (+32).

These industries as indicated earlier are directly related to the oil and gas sector supply chain. However, the two industries that have grown the fastest are service related industries:

Accommodation and food services (+112.5% growth) Health care and social assistance (+63.6% growth.


When Lone Eagles are successful they expand

their operations by leasing office space and hiring staff or contracting out

work to other Lone Eagles.

The only two industries that have experienced a decrease in the number of self employed are in retail trade (-9 firms) and information and cultural industries (-1 firm).

FIGURE 2.8: CITY OF LEDUC, `NO EMPLOYEE` BUSINESS GROWTH, DECEMBER 2007 - JUNE 2011

Source: Statistics

Canada, Business Patterns data, 2007 and 2011.


11 Agriculture, Forestry, Fishing and Hunting 127 136 9 7.1% Lagging Increase

21 Mining, Quarrying, and Oil and Gas Extraction 25 33 8 32.0% Strong Increase

22 Utilities 0 2 2 0.0% N/A

23 Construction 133 166 33 24.8% Strong Increase

31-33 Manufacturing 19 20 1 5.3% Marginal Increase

41 Wholesale Trade 25 26 1 4.0% Marginal Increase

44-45 Retail Trade 53 44 -9 -17.0% Significant Decrease

48-49 Transportation and Warehousing 73 79 6 8.2% Lagging Increase

51 Information and Cultural Industries 5 4 -1 -20.0% Marginal Decrease

52 Finance and Insurance 50 50 0 0.0% No Increase

53 Real Estate and Rental and Leasing 123 155 32 26.0% Strong Increase

54 Professional, Scientific and Technical Services 109 147 38 34.9% Strong Increase

55 Management of Companies and Enterprises 39 57 18 46.2% Strong Increase56 Administrative and Support, Waste Management and Remediation Services 40 46 6 15.0% Lagging Increase

61 Educational Services 6 8 2 33.3% Marginal Increase

62 Health Care and Social Assistance 11 18 7 63.6% Significant Increase

71 Arts, Entertainment and Recreation 8 9 1 12.5% Marginal Increase

72 Accommodation and Food Services 8 17 9 112.5% Significant Increase

81 Other Services (except Public Administration) 92 92 0 0.0% No Increase

91 Public Administration 0 0 0 0.0% N/A

Total Economy 946 1,109 163 17.2%

Industry (NAICS) December 2007

June 2011 % Growth

Growth ClassificationGrowth

Agri – Food Sector: The businesses in this sector generally consist of support activities for agriculture producers, food processors and food distributors. These businesses have grown by 19.0%, from 2007 to 2011, having increased from 21 to 25 firms. The remaining constituent categories have each added at least one firm since 2007, but have not exceeded two. While this sector’s growth does not rival that of the oil and gas related sector, it remains an important component of Leduc’s business profile.

FIGURE 2.9: CITY OF LEDUC AGRI-FOOD SECTOR, BUSINESS GROWTH, 2007-2011

Source: Statistics

Canada, Business Patterns data, 2007 and 2011.

Hospitality and Tourism: At the core of a creative economy are the industries which are captured in a community’s tourism economy. In assessing Leduc’s hospitality and tourism sector consideration has been given to:


While the agri-food sector’s growth does not rival that of the oil and gas

related sector, it remains an important component of Leduc’s business

10 11

45

22

5

7

0

5

10

15

20

25

30


413 Food, Beverage and Tobacco Wholesaler-Distributors

411 Farm Product Wholesaler Distributors

311 + 312 Food & Beverage Manufacturing

115 Support Activities for Farms

21 firms 25 firms

Arts, entertainment and recreation (NAICS code 71) – This comprises performing arts, spectator sports, promoters, artists and writers, heritage institutions, amusement and gambling establishments, museums and art galleries. For Leduc, this component of the industry will provide business visitors with activities to experience.

Accommodation and food services (NAICS code 72) – This consists largely of the services that are made available to travelers when they come to a community. It includes hotels, motels, campgrounds, bed and breakfast establishments, full and limited service restaurants and drinking establishments.

While the business visitor purchases more in a community than is offered by these sorts of attractions and support services, they do serve as useful proxies to describe the overall state of the industry in a community.

From 2007 to 2011, this business area has shown considerable growth of 24.6% from 69 to 86 firms. Food Services and Drinking Places have led growth by adding 10 new businesses, increasing the total number of firms from 35 to 45, which represents an increase of over 28.6%. Accommodation Services have also increased in recent years, having grown from 13 to 19 firms. The number of firms in the remaining constituent categories have each remained relatively constant, indicating that the sector is largely driven by hospitality firms providing accommodation and food services.

FIGURE 2.10: CITY OF LEDUC HOSPITALITY AND TOURISM SECTOR, BUSINESS GROWTH, 2007-2011

9 9

11 121 1

1319

35

45

0

20

40

60

80

100


722 Food Services & Drinking Places

721 Accommodation Services

713 Amusement, Gambling & Recreation Industries

712 Heritage Institutions

711 Performing Arts, Spectator Sports & Related Industries

69 firms 86 firmsLargely

hospitality driven

industry for business visitors



The hospitality and tourism sector is largely driven by hospitality firms

providing accommodation and food

Summary: Leduc’s Current Economic Position

Key Highlights The energy industry is Alberta’s most important economic driver – accounting for over 23% of the provincial economy. Alberta will continue to experience significant capital investment relating to infrastructure and manufacturing projects. Port Alberta has considerable regional implications. It has the potential to integrate multi-modal and related services

across the Edmonton Region while directly benefiting the economy of neighbouring communities. Freelance professionals, or ‘lone eagles’, are knowledge workers with highly transportable skills. It is essential for

local policymakers to understand and support the needs of these professionals. Local prospects for growth in food processing remain strong as rising energy costs continue to increase the cost of

transporting and growing food. The hospitality and tourism sector is well positioned to experience near term growth as the Edmonton International

Airport builds on its, already considerable, passenger service capacity. Business and community stakeholders are concerned with:

a. Balancing local business and industrial interests with residential and neighbourhood development. b. Fully leveraging local transportation networks while advancing Leduc’s economy.c. Fostering regional partnerships. Leduc cannot be ‘insular looking’.

Since 2007, business growth has been healthy in Leduc – increasing by over 11%. Oil and gas related activities directly account for nearly 25% of the local economy. Leduc is in an excellent position to benefit from the proximity to the Edmonton International Airport. The City is part of a supply chain logistics hub for global trade and local business growth is high among those

businesses with no employees (lone eagles). The local agri-food sector is small, but an important part of the regional economy.. Local growth in the hospitality and tourism sector has been driven by food and accommodations providers.

This section examined the Alberta economy`s historic growth and future industry opportunities. The section also identified key themes or messages that are important to the Leduc business and economic development stakeholder community and profiles key sectors of the economy that are poised to grow in the forthcoming years. The following section will examine Leduc`s position compared to other Alberta communities that are competing for business investment.


3 Regional Competitive AnalysisThe City of Leduc was compared to several other communities in the Edmonton Region and other selected Alberta communities. The competitive characteristics that were analyzed included: population and population growth; residential and non-residential tax rates; residential, non-residential and machinery and equipment assessment shares; residential, non-residential and machinery and equipment tax revenues; available industrial lands; new industrial park developments and permitted use flexibility to accommodate business growth in specific sectors.

Population and Population Growth: The City of Leduc has a population of 23,293 as of 2010, which is a small population base in comparison to Edmonton (782,439) and to a lesser extent Strathcona County (87,998) and St. Albert (60,138). However, when population growth over a five year time period is examined the City of Leduc is growing strongly at 49% and second only to its neighbouring community Leduc County (218%).

FIGURE 3.1: POPULATION AND POPULATION GROWTH COMPARISON, SELECTED ALBERTA COMMUNITIES, 2005-2010


782,439

87,998

60,138

30,089

24,646

23,293

18,653

13,260

90,084

39,822

34,597

12,285

0 500,000 1,000,000

Edmonton

Strathcona County

St. Albert

Parkland County

Spruce Grove

City of Leduc

Fort Saskatchewan

Leduc County

Red Deer

Airdrie

Rocky View

Wetaskiwin

Capital Region

Communities

218%

49%

34%

27%

10%

10%

7%

1%

47%

14%

14%

10%

0% 50% 100% 150% 200% 250%

Leduc County

City of Leduc

Spruce Grove

Fort Saskatchewan

Edmonton

Strathcona County

St. Albert

Parkland County

Airdrie

Red Deer

Rocky View

Wetaskiwin

Capital Region

Communities

When population growth over a five year time period is examined the City

of Leduc is growing strongly at 49% and second only to its neighbouring

community Leduc County (218%).

Source: Alberta Ministry of Municipal Affairs, Municipal Profiles.

Residential and non-residential tax rates: The residential tax rate in the City of Leduc is 6.18%, which is high in comparison to other communities in the Edmonton Region and Alberta. The non-residential tax rate is 9.97%, which tends to be high; however, this rate is much lower than Edmonton (12.47%), Wetaskiwn (17.69%), Red Deer (12.39%) and St. Albert (12.06%).

FIGURE 3.2: 2010 MUNICIPAL TAX RATE COMPARISON, RESIDENTIAL AND NON-RESIDENTIAL PROPERTIES, SELECTED ALBERTA COMMUNITIES


Note: Municipal tax rates have been rounded to two decimals and do not account for education tax rates, allowance for non-collection of requisitioned taxes or senior lodge accommodation tax rates. Machinery and equipment tax is not included.


Residential/Farmland Non-Residential

7.45

6.18

5.30

4.73

4.36

4.08

3.75

3.00

6.47

5.39

4.02

2.32

0.00 5.00 10.00 15.00 20.00

St. Albert

City of Leduc

Spruce Grove

Edmonton

Strathcona County

Fort Saskatchewan

Parkland County

Leduc County

Wetaskiwin

Red Deer

Airdrie

Rocky View

12.47

12.06

9.97

8.19

7.34

7.14

6.94

3.44

17.69

12.39

7.45

6.96

0.00 5.00 10.00 15.00 20.00

Edmonton

St. Albert

City of Leduc

Strathcona County

Fort Saskatchewan

Leduc County

Parkland County

Spruce Grove

Wetaskiwin

Red Deer

Airdrie

Rocky View

Capital Region

Communities


Residential, non-residential and machinery and equipment assessment shares: Approximately three-quarters (74.5%) of the City of Leduc`s 2010 assessment base is residential. One quarter (25.3%) of the City`s 2010 assessment base is non-residential with only a marginal share of the assessment base classified as machinery and equipment. The City of Edmonton`s assessment base shares are very similar to the City Leduc. Interestingly, the majority of Leduc County`s assessment base is non-residential at 63.3% and an additional 2.3% classified as machinery and equipment. This places Leduc County as the most industrial community among the comparative communities in terms of non-residential assessment. Edmonton Region communities such as Strathcona County, Parkland County and Fort Saskatchewan have sizable non-residential assessment base. Both Strathcona County and Fort Saskatchewan have very large machinery and equipment assessment shares.

FIGURE 3.3: 2010 RESIDENTIAL, NON-RESIDENTIAL AND MACHINERY & EQUIPMENT ASSESSMENT SHARE COMPARISON



Leduc County

Fort Saskatchewan

Strathcona County

Parkland County

Edmonton

City of Leduc

Spruce Grove

St. Albert

Red Deer

Rocky View

Wetaskiwin

Airdrie

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

34.4%

53.5%

58.6%

71.0%

74.0%

74.5%

85.5%

89.2%

77.5%

80.5%

84.8%

84.9%

63.3%

18.1%

13.9%

26.3%

25.4%

25.3%

14.5%

10.7%

22.2%

15.4%

15.2%

15.0%

2.3%

28.4%

27.6%

2.7%

0.7%

0.2%0.0%

0.2%

0.3%

4.0%

0.0%

0.1%

% Residential % Non-Residential % Machinery and equipment

Residential, non-residential and machinery and equipment tax revenues: The City of Leduc receives nearly two-thirds (64.5%) of its $30.6 million (2009) in property taxation revenues from the residential tax base. The remaining one-third (35.5%) comes from non-residential properties. Leduc County`s property taxation revenues are very different from the comparator communities where less than one-quarter (21.7%) of residential taxation comes from residential properties. Over three-quarters (76.3%) of the $44.7 million collected in property taxation comes from non-residential properties, which is a very large proportion not only in the Province of Alberta, but across Canadian municipalities. Communities such as Strathcona County and Fort Saskatchewan receive a sizable portion of their property tax revenues from machinery and equipment at 29.9% and 29.5% respectively. The City of Edmonton`s residential to non-residential taxation base is at a 59:41 split.

FIGURE 3.4: 2009 RESIDENTIAL, NON-RESIDENTIAL AND MACHINERY & EQUIPMENT PROPERTY TAXATION REVENUES COMPARISON

Source: Alberta Ministry of Municipal Affairs, Financial Information Return, Schedule K.


Total

21.7%

45.0%

49.9%

58.8%

62.6%

64.5%

79.0%

84.8%

62.4%

66.6%

66.9%

75.9%

76.3%

25.5%

20.2%

41.2%

34.7%

35.5%

21.0%

15.2%

37.6%

28.5%

33.1%

24.1%

2.1%

29.5%

29.9%

0.0%

2.7%

0.0%

0.0%

0.0%

0.0%

4.9%

0.0%

0.0%

0% 20% 40% 60% 80% 100%

Leduc County

Fort Saskatchewan

Strathcona County

Edmonton

Parkland County

City of Leduc

Spruce Grove

St. Albert

Red Deer

Rocky View

Wetaskiwin

Airdrie

Residential Non-Residential Machinery & Equipment

$44.7 million

$26.1 million

$30.6 million

$43.7 million

$1.1 billion

$182.4 million

$28.9 million

$12.7 million

$74.5 million

$113.9 million

$90.5 million

$35.5 million

Property Taxes

Supply of Vacant Industrial Land: The supply of “shovel ready” lands currently available for sale/lease is a key measure of a municipality’s economic competitiveness. The following figure summarizes the amount of vacant industrial land which is serviced and currently for sale/lease in each municipality. The next figure summarizes the total designated vacant industrial land in each municipality (this includes zoned and designated, both serviced and unserviced) and in the City of Leduc relative to the other municipalities in the surrounding market area, based on recent local supply inventory data.

As shown, the City of Leduc with 53 net ha (132 net acres) has substantially less land than Parkland County and the City of Edmonton with 137 net ha (340 net acres) and 129 net ha (318 net acres) respectively. The City of Leduc is nearly on par with Leduc County, which has 56 net ha (137 net acres) and has more serviced vacant industrial land than Fort Saskatchewan and the remaining reference municipalities.

In terms of total vacant designated industrial land, the pattern remains consistent. The City of Leduc is in the middle of the pack with 526 net ha (1,300 net acres). The City of Edmonton, has the largest supply of the municipalities surveyed with approximately 4,533 net ha (11,200 net acres) of designated vacant industrial land. With approximately 2,226 net ha (5,500 net acres), Parkland County offers the second largest supply, followed by Leduc County with 890 net ha (2,200 net acres), the Spruce Grove with 405 net ha (1,000 net acres) and Fort Saskatchewan with 384 net ha (950 net acres).

FIGURE 3.5: VACANT SERVICED INDUSTRIAL LAND AVAILABLE FOR SALE/LEASE (NET HA), COMPARABLE COMMUNITIES, 2009

Source: Bourgeois and Company Ltd.;Note: The data includes land that was on the market for sale or lease in Q1 2009

FIGURE 3.6: TOTAL VACANT DESIGNATED INDUSTRIAL LANDS (NET HA), COMPARABLE COMMUNITIES, 2010


The City of Leduc is nearly on par with Leduc County, which has 56 net ha

(137 net acres) and has more serviced vacant industrial land than Fort

Saskatchewan and the remaining reference municipalities.

Edmonto

n

Parkla

nd Coun

ty

Ledu

c Cou

nty

City of

Leduc

Spruce

Gro

ve

Fort S

aska

tchew

an0

5001,0001,5002,0002,5003,0003,5004,0004,5005,000

4,533

2,226

890

526 405 384

Tota

l Vac

ant D

esig

nate

d In

dust

rial

Land

(net

ha)

Source: Watson & Associates Economists Ltd.Note: Land areas are approximate.

Price of Vacant Serviced Industrial Land: From a competitiveness perspective, land prices can provide a key advantage, especially for land intensive uses such as transportation, wholesale trade/logistics, warehousing and large scale manufacturing. Though competitive land costs provide an economic advantage in terms of the cost of development, very low land prices may be indicative of low demand.

The Edmonton Region experienced a significant increase in the price of serviced industrial land over the 2005 through 2008 period, which increased from an average of $144,000 per acre to $469,000 per acre, as illustrated in the following figure. Prices declined in 2009 to $368,000 per acre due to a drop in building activity and demand, but rebounded moderately in 2010 to $431,000 per acre. Prices for industrial land in the Edmonton Region vary widely depending on location and servicing, ranging from a low of $35,000 per acre for unserviced heavy industrial land in Alberta’s Industrial Heartland, to a high of close to $1,000,000 per acre in prestigious business parks in south Edmonton.

FIGURE 3.7: AVERAGE INDUSTRIAL LAND PRICE, EDMONTON REGION, ($/ACRE)


Prices for industrial land in the Edmonton Region vary widely depending on location

and servicing, ranging from a low of $35,000 per acre for unserviced heavy industrial land in Alberta’s Industrial Heartland, to a high of

close to $1,000,000 per acre in prestige business parks in south Edmonton.

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

$500,000

$91,000

$144,000$168,000

$115,000

$144,000

$266,000 $274,000

$469,000

$368,000

$431,000

Aver

age

Indu

stria

l Lan

d Pr

ices

($/a

cres

)

Source: Colliers InternationalNote: Average industrial land prices from 2001-2010 sales data (total volume in sales /total land area (acres)); includes both serviced and unserviced land.

The following figure summarizes vacant serviced industrial land prices ($/acre) in the City of Leduc and the surrounding market area, based on recent market survey data. As illustrated, serviced industrial land prices in the City of Edmonton are by far the highest in the surrounding market area at $752,000 per acre. This is followed by Sherwood Park in Strathcona County at $493,000 and Spruce Grove at $412,000 per acre. In comparison, serviced industrial land prices in the City of Leduc are at $402,000 per acre, which is high in comparison to other suburban municipalities neighbouring the City of Edmonton. Serviced industrial land prices are moderately lower in Fort Saskatchewan, Nisku (Leduc County) and Parkland County. Although not presented in the following figure, the lowest serviced industrial land prices in the Edmonton Region are found in Sturgeon County where prices average $177,000 per acre.

FIGURE 3.8: AVERAGE SERVICED VACANT INDUSTRIAL LAND PRICE ($/ACRE)


Edmon

ton

Strathc

ona C

ounty

(1)

Spruc

e Gro

ve

City of

Leduc

St. Albe

rt

Fort S

aska

tchew

an

Ledu

c Cou

nty (2

)

Parkla

nd C

ounty

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

$800,000$752,000

$493,000

$412,000 $402,000 $400,000 $372,000$328,000 $327,000

Aver

age

Indu

stria

l Lan

d Pr

ice

($/a

cre)

Source: Bourgeois and Company Ltd., 2009Note 1. Represents Sherwood Park (County's Urban Service Area) Note 2. Land Prices for Nisku Industrial Area


The City of Edmonton has experienced a drop in industrial vacancy rates. In the first quarter of 2011, this rate was at 3.9% which was down 0.7% from the same time in 2010.10 While this is not a substantial decrease in vacancy, this decrease suggests that the market is stabilizing from the recession and that tenants are no longer downsizing, but looking for and expanding their space.

Edmonton’s surrounding markets, including (but not limited to) the City of Leduc, Leduc County, Parkland County and Strathcona County, have experienced a moderate decline in vacancy and finished the quarter with a 1.7% vacancy rate. This is down from the first quarter of 2010 when the vacancy rate measured at 1.8%. In the first quarter of 2011, land sales in these markets totalled almost $4.4 million and equated to about 15 acres of land. This is similar to the just over $5 million and 16.75 acres sold in the first quarter of 2010.

In terms of regional industrial trends, the industrial sector is picking up on the back of increased activity in oil and gas. As a result, companies are taking back previously marketed space for their own use and the supply of sublease space is diminishing. Investment sales are seeing more of the same, a large demand for product but a lack of supply. While there has been a general trend of increased activity in the industrial market, land sales activity has increased as well. Edmonton’s surrounding markets have seen an increase in demand for shop space with yards, but there is a shortage of supply as the oil and gas service sector is expanding again. Tenants are looking for specialized space that meets the needs of their business operations, including heavy power equipment, open floor space, and large yards. A general lack of supply has tenants looking for raw land appropriate for construction of typical shop space. Land is also in demand for lay down and assembly yards.11

Permitted use flexibility to accommodate business growth in specific sectors: Permitted uses for commercial and industrial lands were examined by community to determine the flexibility to accommodate business growth in the specific sectors. The results are presented in detail in Appendix B. There are five land use designations that can accommodate business growth in the five sectors (i.e. oil and related sector, multi-modal logistics, Lone Eagles, agri-food and hospitality /tourism.12 Leduc’s commercial designated uses – central business district and commercial – are flexible to accommodate growth in oil and gas related businesses, Lone Eagles and hospitality/ tourism businesses. Commercial areas can accommodate growth for firms that provide professional services such as architectural, engineering and related services. The three industrial classifications (light, medium and cottage) can accommodate growth in all sectors except hospitality/ tourism.

10 Colliers International (2010). Edmonton Alberta Market Report. 11 Colliers International (2010). Edmonton Alberta Market Report.12 Commercial – Neighbourhood Retail and Service was not included since this land use designation’s general purpose is to accommodate local retail and service outlets. The Zoning flexibility comparison was focused on designated uses that could accommodate growth among businesses that can potentially serve regional, national and potentially international markets/.


A general lack of supply has tenants looking for raw

land appropriate for construction of typical

shop space. Land is also in demand for lay down

and assembly yards

All the comparator communities provided flexibility in accommodating growth in the specific sectors. There are some communities such as Strathcona County and Rocky View County that have a large number of commercial and industrial designated uses. Offering a large number of designated uses can encourage specific types of business development in areas of a community. Strathcona County’s industrial agri-business designation and Rocky View County’s Business – Agricultural Services provides land use policy specifically for agricultural-related business. Other communities provide specific policies for industrial storage (Rocky View County), airport-related industries (Wetaskiwin) or railway related industries (Airdrie).


City of Leduc Community GardenCommercial Area

Summary: Regional Competitive Analysis

Key Highlights: Leduc’s population is small (23,293), in relation to Edmonton or St. Albert, but it is growing at a tremendous rate. The price of industrial land across the Edmonton Region decreased during the recession but has since

rebounded. The Edmonton Region has seen an increase in demand for shop space with yards, but there is a shortage of

supply as the oil and gas service sector is expanding. Leduc does not hold a regional competitive advantage in terms of residential or non-residential tax rates. Leduc is in the middle of the pack in terms of the availability of serviced industrial land and vacant industrial land. The typical price for serviced vacant industrial land in Leduc is average when compared to other communities

across the Edmonton Region. Once more, this comparison affords no competitive advantage to the City of Leduc.


4 Industry-Specific Competitive Benchmarking4.1 Site Selection Considerations

A site location matrix from Austin Consulting, a leading American firm that provides site selection services for expanding businesses, provides weighting for investment factors and differentiates these factors as high, medium or low levels of importance. This matrix was used to guide the discussion for industry-specific site selection considerations. Full details of site selection considerations are provided in Appendix C. Refer to Appendix D for a competitiveness comparison between the City of Leduc and Leduc County.

Oil and Gas Related sector: As identified earlier, the oil and gas related sector has a large supplier business component in construction industries (e.g. specialty trade contractors). Although many of the businesses in these industries may employ many people the discussion focuses on the site selection considerations for the high value added services industry, which are architectural, engineering and related services. People employed in this industry are highly educated and engaged in creative work which strengthens and advances the oil and gas sector. More specific services include:

Engineering services Geophysical surveying and mapping services and Testing laboratories.

Leading innovative industries such as nanotechnologies and their engineering application to the oil and gas sector would be captured in this high value-added services industry. Highly important location factors for firms in this industry are presented in the following table.


Although many of the businesses in the oil and gas related industries may employ many people

the discussion focuses on the site selection considerations for the high value added services

industry, which are architectural, engineering

Architectural, Engineering and Related Services

Labour Force Characteristics

Population (current and projected) Age profile Commuting patterns Income (average income, household income) Size of total labour force / participation rate Availability of skilled workers Cost of skilled workers Competition for required skill sets Level of education Language skills

Education & Training

Elementary school performance rankings Secondary school performance rankings Community colleges – availability and quality of programs Universities – availability and applicable programs Local employment and training services

Quality of Life

Health care facilities Emergency services Crime rate Recreation and cultural facilities Housing availability and cost

Property Availability and Cost Commercial (office) building availability Commercial (office) land availability Cost of land/ lease rates

Multi-modal Logistics sector: Highly important location factors for the multi-modal logistics sector are related to proximity to transportation infrastructure, available industrial properties and available unskilled workers. Further details are presented in the following table.


Transportation / Distribution

Proximity to current and future customer markets Proximity to suppliers Proximity to highways Proximity to railways/intermodal facilities Third party trucking availability Third party warehousing availability


Size of total labour force/ participation rate Unemployment rate/ employment rate Availability of unskilled workers Cost of unskilled workers Workers compensation and employment insurance

Property Availability and Cost Industrial building availability Serviced industrial land availability (shovel ready sites) Cost of land/ lease rates


Lone Eagles: Lone Eagles’ infrastructure requirements are few, which means limited investment by the region. However, the following are essential: efficient telecommunications (mobile phone coverage, broadband access), reliable courier service and reasonable access to an airport with commuter flights. Further details are presented in the following table.

Quality of Life

Health care facilities Emergency services Crime rate Recreation and cultural facilities Housing availability and cost


Elementary school performance Secondary school performance Community colleges – quality Universities – applicable programs Local employment and training services

Transportation / Distribution/ Utilities

Proximity to highways Proximity to airports Telecommunications


Agri-Food sector: Highly important location factors are related to water, sewer and electricity servicing capacity and availability, cost of industrial land and transportation networks and trucking availability. Further details are presented in the following table.


Income Ethnicity profile Size of the total labour force/ participation rate Unemployment rate/ employment rate Availability of unskilled workers Cost of unskilled workers Presence of union (labour management relations)

Transportation / Distribution Proximity to current and future customer markets Proximity to highways Third party trucking availability

Utilities Electricity (capacity, availability, rate, reliability) Water (capacity, availability, rate, reliability) Sewer (capacity, availability, rate, reliability)

Property Availability and Cost Serviced industrial land availability (shovel ready sites)


Hospitality/Tourism sector: Highly important locations factors for the hospitality and tourism sector are related to available commercial properties, transportation connections and quality of life features. Further details are presented in the following table.

Property Availability and Cost Commercial building availability Commercial land availability Cost of land and lease rates

Transportation / Distribution Proximity to Current/Future Customers Proximity to Highways Proximity to Airports

Quality of Life

Health care facilities Emergency services Crime rate Recreational and cultural facilities

These industry-specific site selection considerations provide the framework to benchmark the City of Leduc against competing communities for similar business investment.

4.2 Key Benchmark IndicatorsThe consulting team undertook a comparison of Leduc’s investment factors against a number of communities. Sources of the data are as follows.

Labour force characteristics were sourced from Alberta Ministry of Municipal Affairs, Municipal Profiles, Capital Region Population & Employment Projections Report, Statistics Canada’s Census Profiles and most recent labour force information, and Service Canada.

Quality of life characteristics were sourced from Statistics Canada’s Census profiles for average dwelling and household income values and municipal websites.


Utilities characteristics were sourced from the Alberta Utilities Commission and Capital Region Southwest Water Commission.

Property availability and cost characteristics were sourced from reports completed by Bourgeois and Company Ltd., Watson & Associates Economists Ltd. and Colliers International Ltd.

4.2.1 Oil and Gas Related SectorLabour Force Characteristics: The City of Leduc is projected to grow to over 33,000 people by 2041. Neighbouring Leduc County’s population is projected to increase to nearly 22,000 people by 2041. Collectively these two communities will remain a smaller urban centre than Strathcona County and Red Deer. However, Leduc benefits from being part of a large regional labour force in the Edmonton Region with access to a regional labour force of nearly 720,000 people. Many of these people in the labour force have access to skill sets such as architecture, engineering and related technologies, which are in demand. Wage rates are typically high in this sector, regardless of where the business is located in the Edmonton Region.

Education & Training: The City of Edmonton is the centre for post-secondary education in the Edmonton Region. All of the other communities reviewed offer secondary schools for residents and benefit from proximity to Edmonton’s post-secondary education and training schools. Red Deer is fortunate to have a college presence in the community.

Quality of Life: Quality of life is a difficult metric to define as it can mean different things to different people. Leduc’s quality of life that it offers its residents is a small-sized city, close to the City of Edmonton and its `big-city’ amenities, with quality health care and recreation services, and a relatively affordable housing market. Compared to the other suburban Edmonton Region communities, the City of Leduc has much more affordable housing costs.

Property Availability and Cost: Historical data and current market research indicates that the City of Leduc, when compared to other localities across the Edmonton Region, holds no competitive advantage in terms of the average cost of serviced industrial lands. In fact, Leduc County’s Nisku industrial park has traditionally offered these lands at a relatively lower cost (for both leasing and sales). Therefore, Leduc’s attraction and retention efforts as they relate to the oil and gas sector cannot rely on any advantage in land availability or cost. This competitiveness finding means that quality of life and quality of place considerations become more important in distinguishing Leduc from competing localities.


Leduc’s attraction and retention efforts as they relate to the oil and gas sector cannot rely on

any advantage in land availability or cost.

FIGURE 4.1: CITY OF LEDUC COMPARED TO OTHER COMMUNITIES: OIL AND GAS RELATED SECTOR

City of Leduc Leduc County Parkland County Strathcona County Red Deer Edmonton

Labour Force Characteristics13

Pop. 23,293 (2010)

Pop. 33,077 (2041)

Median age 36.8 (2006)

- Majority work outside

of Leduc

- Median Household

income (2005) =

$66,963

- Nearly 2,000 residents

studied architecture,

engineering and related

technologies.

Pop. 13,260 (2010)

Pop. 21,852 (2041)



of Leduc County

- Median Household

income (2005) =

$66,036

- Over 1,600 residents



technologies.

Pop. 30,089 (2010)

Pop. 49,476 (2041)



of Parkland County.

- Median Household

income (2005) =

$78,052




technologies

Pop. 87.998 (2010)

Pop. 153,264 (2041)


- Nearly half of the

employed labour force

works outside of

Strathcona County

(2006).

- Median Household

income (2005) =

$90,746




technologies.

Pop. 90,084 (2010)

Pop. 151,182 (2031)


- Majority of the


works in Red Deer.

- Median Household

Income (2005) =

$63,034

- 8,500 residents studied

architecture, engineering

and related

technologies.

- Avg. Wage for a civil

engineering technologist

= $25.20/hr.

Pop. 782,439 (2010)

Pop. 1.2 million (2041)


- Large majority of the


works in Edmonton

- Median Household

income (2005) =

$57,085

- Nearly 80,000

residents studied

architecture, engineering

and related

technologies.

Similarities in Regional Labour Force Characteristics: These communities are part of the Edmonton

regional labour force of 719,400, participation rate of 74.4 and unemployment rate of 5.3 (2011.) Across the

Edmonton Region the average wage for a civil engineering technologist is $28.72/hr. The labour supply and

demand for this occupation is expected to be balanced. The Edmonton Region is dominated by people with a

high school or college diploma with the workforce having primarily English language skills.

13 Source: Alberta Ministry of Municipal Affairs, Municipal Profiles, Statistics Canada, Census Profiles, Labour Force Information September 11 to 17, 2011, catalogue no. 71-001-X, http://www.statcan.gc.ca/pub/71-001-x/71-001-x2011009-eng.pdf; City of Red Deer Population Projections, http://www.reddeer.ca/City+Government/City+Services+and+Departments/Legislative+and+Administrative+Services/Census/Population+Projections/Population+Projections.htm; Working in Canada website, last modified on June 29th, 2011, http://www.workingincanada.gc.ca/report-eng.do?action=search_occupation; Municipal websites.


The Oil and Gas related workforce is relatively homogeneous across the Edmonton Region in

terms of skills, education and average wages



- Edmonton Region localities are all immediately serviced by their own elementary and secondary schools.

- All major regional colleges or universities are located in the City of Edmonton.- Red Deer College

- NorQuest College.

NAIT

- University of Alberta

-Grant MacEwan

University.

-The King’s University

College.

-Athabasca University.

Quality of Life14

- Leduc Community

Hospital, CBI Health

Centre - Leduc

- New Recreation Centre

- Average house value =

$228,807, over 6,500

private dwellings (2006)

- Several arenas and an

equestrian centre


$359,271, over 4,500


- Provincial parks and

Natural areas


$321,765, over 10,200


-Strathcona County

Health Centre

- A multi-use recreation

centre, leisure centres,

wilderness centre, and

arts and festivals


$323,857, over 28,600


- Red Deer Regional

Hospital Centre

-Several recreation

centres


$244,254, over 32,600


-Sophisticated network

of health care centres

and services

- Recreation and cultural

attractions that can draw

people to the Region.


$255,525, nearly

300,000 private

dwellings (2006)

14 Source: Alberta Health Services; Facilities in the Edmonton area, http://www.albertahealthservices.ca/facilities.asp?pid=fgeo&geo=14,



Property Availability and Cost15

-Total vacant serviced

industrial land for sale or

lease in 2009 = 53 net

ha.

- Total vacant

designated industrial

lands in 2010 = 526 net

ha.

-Average industrial land

price ($/acre) in 2009 =

$402,000.

- Current example of

asking price ($/acre) for

serviced industrial land

=$400,000.




ha.

- Total vacant



ha.



$328,000.




=$398,000.




ha.

- Total vacant



ha.


price ($/acre) in 2009

=$327,000.




ha.



=$493,000.

- Current examples of



=$425,000 - $420,000.

-Total vacant (not

necessarily serviced)


lease in 2011 = 173 ha.




in Queens Business

Park =$330,000 -

$345,000.




ha.

- Total vacant



ha.



=$752,000.

15 Industrial Land Pricing Data has been derived from a variety of sources. Average Serviced Vacant Industrial Land Price Data: Bourgeois and Company Ltd., 2009; Total Vacant Designated Industrial Lands Data 2010: Watson & Associates Economists Ltd.; Vacant Serviced Industrial Land Available for Sale/Lease 2009: Bourgeois And Company Ltd; Current Industrial Land Asking Prices: Royal Park Realty Property Listings, Cushman & Wakefield Edmonton Property Listings, Avison Young Commercial Listings, Trans America Group Listings; Red Deer Industrial Market Report 2011: Soderquist Appraisals Ltd; Red Deer Queens Business Park Industrial Land Pricing: The City of Red Deer, Land and Economic Development 2011.


4.2.2 Multimodal Logistics SectorTransportation/ Distribution - The Edmonton Region is serviced by a considerable network of railroads and highways, as well as by a major airport. The most notable highways are Highway 2, linking Calgary to Edmonton, and the Trans-Canada Highway. The Edmonton International Airport is located immediately south of Edmonton along Highway 2 between the City of Leduc and Nisku (within Leduc County). The region’s rail network is serviced by Canadian National (CN) Railways and Canadian Pacific (CP) Rail. The rail network follows a hub-and-spoke pattern with Edmonton serving as the regional hub, and with rail lines branching to all neighbouring communities.

The City of Leduc is located along Highway 2, with immediate access to over one million people, and is serviced by a Canadian Pacific Rail facility in Leduc County.. Leduc is also adjacent to the Edmonton International Airport and is home to 88 trucking and four warehousing firms. Leduc County shares these attributes, with the exception of being home to fewer trucking firms. Parkland County and the City of Red Deer are each the site of 169 and 224 trucking firms respectively. These localities are well serviced by rail and highway networks, but are comparatively further from an airport than Leduc. The City of Edmonton is still the center for multimodal logistics across the Edmonton Region with 2,402 trucking firms and 130 warehousing firms. Edmonton is serviced by Highway 2, the Trans-Canada Yellowhead Highway, a dense rail network, and is in proximity to the Edmonton International Airport. There are no communities within the Edmonton Region that can challenge Edmonton in terms of its capacity to accommodate the multimodal logistics sector.

Labour Force Characteristics – The City of Leduc benefits from being part of a large regional labour force in the Edmonton Region of nearly 720,000 people. The available wage rate data indicates that wages in the multimodal sector are uniform across the Edmonton Region. For example, a shipper /receiver earns $16.77/hr in Leduc, Leduc County, Parkland County, and in Edmonton. Accordingly, in terms of wage rates, Leduc exhibits no advantage/ disadvantage when compared to neighbouring localities.

Property Availability and Cost – To reiterate the conclusions outlined in the Oil and Gas Sector discussion, current market research indicates that the City of Leduc, when compared to other localities across the Edmonton Region, holds no competitive advantage in terms of the average cost of serviced industrial lands. In fact, Leduc County’s Nisku industrial park has traditionally offered these lands at a relatively lower cost (for both leasing and sales). Therefore, any attraction or retention efforts, for Leduc, in the multimodal logistics sector cannot rely on any advantage in land availability and cost. Edmonton has higher land costs than any neighbouring locality, but it remains the regional center for multimodal logistics because of its unparalleled size and logistics related servicing.


There are no communities within the Capital Region that can challenge

Edmonton in terms of their capacity to accommodate the multimodal logistics

sector. It remains the regional center for multimodal logistics because of its

unparalleled size and logistics related

FIGURE 4.2: CITY OF LEDUC COMPARED TO OTHER COMMUNITIES: MULTIMODAL LOGISTICS SECTOR

City of Leduc Leduc County Parkland County Edmonton Wetaskiwin Red Deer

Transportation / Distribution16

-Immediate access to

over 1 million people

and growing to 1.5

million people by 2028.

-Highway 2 access.

- Proximity to CP Rail

intermodal facility in

Leduc County.

- Proximity to Edmonton

International Airport.

- 88 trucking firms and

four warehousing firms.

-Access to the same

market as Leduc.

- Highway 2 access.

- CPR intermodal rail

facilities in Nisku

Business Park.

- Location of Port Alberta

- Edmonton International

Airport.


four warehousing firms.

-Access to the same

market as Leduc.

- Trans-Canada

Highway access.

-Access to CN rail

stations.


three warehousing firms.

-Access to the same

market as Leduc.

- Highway 2 and Trans-

Canada Highway

access.

- Multiple CN and CP rail

stations.

-Edmonton City Center

Airport.

-Proximity to Edmonton


- 2,402 trucking firms

and 130 warehousing

firms.

- Removed from

Highway 2.

- CP rail access.

- Located on Highway 2 mid

way between Calgary and

Edmonton.

- CP rail access.


seven warehousing firms.


Similarities in Regional Labour Force Characteristics: These communities are part of the Edmonton regional labour force of

719,400, participation rate of 74.4 and unemployment rate of 5.3 (2011). Across the Edmonton Region the average wage of a

Shipper/ Receiver is $16.77/hr. The labour supply and demand for this occupation is expected to be fair.

- Labour force characteristics

are similar to the City of

Leduc, except the Avg. Wage

for a Shipper/ Receiver

$15.92/hr.

- Labour supply and demand

information is not available.

16 Source: Capital Region Population & Employment Projections Report, Appendix 1, March 2009, Growing Forward The Capital Region Growth Plan, Statistics Canada, Business Patterns data, June 2011, Working in Canada website, last modified on June 29th, 2011, http://www.workingincanada.gc.ca/report-eng.do?action=search_occupation

17 Source: Alberta Ministry of Municipal Affairs, Municipal Profiles, Statistics Canada, Census Profiles, Labour Force Information September 11 to 17, 2011, catalogue no. 71-001-X, http://www.statcan.gc.ca/pub/71-001-x/71-001-x2011009-eng.pdf


City of Leduc Leduc County Parkland County Edmonton Wetaskiwin Red Deer





ha.

- Total vacant



ha.



$402,000.




=$400,000.




ha.

- Total vacant



ha.



$328,000.




=$398,000.




ha.

- Total vacant



ha.



=$327,000.




ha.

- Total vacant



ha.



=$752,000.

-Historical Data Not

Available.


Available.

18 Industrial Land Pricing Data has been derived from a variety of sources. Average Serviced Vacant Industrial Land Price Data: Bourgeois and Company Ltd., 2009; Total Vacant Designated Industrial Lands Data 2010: Watson & Associates Economists Ltd.; Vacant Serviced Industrial Land Available for Sale/Lease 2009: Bourgeois And Company Ltd; Current Industrial Land Asking Prices: Royal Park Realty Property Listings, Cushman & Wakefield Edmonton Property Listings, Avison Young Commercial Listings, Trans America Group Listings.


4.2.3 Lone EaglesQuality of Life – With minimal infrastructure considerations factoring into Lone Eagles’ locational decision, it is a community’s quality of life and quality of place features that serve to attract or deter them. Each community has attractive features, which makes comparing quality of place an inherently subjective exercise. Outlining and comparing the following metrics do, however, offer insight into what a potential Lone Eagle might also observe. The City of Leduc is well positioned in this regard. Leduc offers a community hospital and a functional downtown with neighbouring residential areas. The 2006 census data affirms that Leduc is a relatively affordable place to live based on median income levels and housing prices. By contrast, Leduc County is comprised of mainly estate residential and lacks a downtown core. On the other hand, Stony Plain and Leduc offer similar medical amenities and downtown characteristics. Stony Plain is also a relatively affordable place to live and is, therefore, one of Leduc’s top regional competitors.

Education & Training – Leduc is without a community college or a satellite campus from an Edmonton-based university. It would appear that the communities closer to the center of Edmonton such as St. Albert and Sherwood Park in Strathcona County have an advantage in this regard. Commuting time is a key determinant of where individuals choose to attend post-secondary learning institutions; therefore, Leduc’s relative location to Edmonton, albeit only 20 km away, is still a significant barrier for students without access to automobiles.

Transportation / Distribution - As previously described, the City of Leduc is located along Highway 2 and is serviced by Canadian Pacific Rail intermodal facility in Leduc County. Leduc is also adjacent to the Edmonton International Airport. Aside from Leduc County, there are no other localities in the Edmonton Region with comparable transport-related features.

Utilities and Telecommunications – The Edmonton Region offers a variety of energy and telecommunication service delivery options. Residents are typically afforded the option of picking their own energy, gas, and telecommunications provider depending on their needs and wants. This survey, however, looked at regulated energy and gas providers, as well as telecommunications servicing pricing to allow for cross-community benchmarking.

In terms of electricity costs, EPCOR provides the same rate of 12.426¢/kWh across the Edmonton Region. Leduc and Leduc County are in the middle of the pack in terms of the price of gas with $3.450/day/GJ. Strathcona County offers the price of gas at $3.338/day/GJ. EPCOR provides water to the entire Edmonton Region at a wholesale rate of 0.75¢/m3 (2010). Water is drawn from the North Saskatchewan River Basin, and pumped from two Edmonton based treatment plants, to service the entire region.


With minimal infrastructure considerations factoring into Lone Eagles’ locational decision, it is a community’s quality of life and quality of place features that serve to attract or deter them…

The City of Leduc is well positioned in this

Shaw Communications offers broadband internet access to the entire Edmonton Region. At a minimum each community is serviced with broadband with up to 100 Mbps download speeds and up to 5 Mbps upload speeds. In August 2011, Shaw upgraded its infrastructure to allow for 250 Mbps download speeds and up to 15 Mbps upload speeds. Outside of Edmonton, this increased service is only available in St. Albert. It should be noted that these are typical service conditions with Shaw not guaranteeing service to every neighbourhood or household. Broadband speeds are very important for Lone Eagles since they rely on them for their interactions with suppliers, other businesses and clients.

FIGURE 4.3: CITY OF LEDUC COMPARED TO OTHER COMMUNITIES: CONSIDERATIONS FOR LONE EAGLES

City of Leduc Leduc County Stony Plain Spruce Grove St. Albert Strathcona County

Quality of Life19

- Leduc Community

Hospital, CBI Health

Centre.

- Leduc New Recreation

Centre.

- Functional Downtown

with surrounding

residential.


$228,807, over 6,500

private dwellings.

- Median Income

Household = $66,963.


equestrian centre.

- Mainly estate

residential.


$359,271, over 4,500

private dwellings.

- Median Income


- Medical facilities

include, Health for Two,

Perc Building & Stony

Plain Physical Therapy

Ltd.

- The Good Samaritan

Society Stony Plain

Care Centre.

-Functional Downtown

with surrounding

residential.


$234,457, over 4,600

private dwellings.

- Median Income


WestView Primary Care

Network.

-Spruce Grove Health

Unit- Stan Woloshyn

Building.

-Other physiotherapy

and medical clinics.

- Mainly suburban

development.


$244,587, over 7,000

private dwellings.

- Median Income


Citadel Care Centre-

Dynamic Sports.

Physiotherapy- Amiha

Diagnostic Imaging.

- Functional downtown,

mixed use.

- Average house value

= $276,978, over

20,500 private dwellings

- Median Income


-Strathcona County

Health Centre



wilderness centre, and

arts and festivals.

- Mainly suburban

development.


$323,857, over 28,600

private dwellings.

- Median Income


19 Average Household Values, Number of Dwellings, and Median Household Income Levels are based on 2006 Statistics Canada Census Data





- All major regional colleges or universities are located in the City of Edmonton. However, some communities do have a college or university presence as described

below.

- NorQuest College,

Stony Plain Campus- Choice College.

- Athabasca University

St. Albert Campus.

- Alberta College of

Paramedics.

- Lakeland College.


-Edmonton Region localities each have immediate access to over 1 million people and growing to 1.5 million people by 2028.

-Highway 2 access.


intermodal facility in Leduc

County.

- Highway 2 access.


facilities in Nisku

Business Park.

- Location of Port

Alberta.

- TransCanada Highway

access.

- CN rail access.

- TransCanada Highway

access.

- CN rail access.

- Trans-Canada.

Highway access.

- Multiple CN and CP

rail stations.

- Highway 216 and

Trans-Canada Highway

access.

- Multiple CN and CP

rail stations.

Utilities20

- In terms of Water, Edmonton Region localities are all serviced by EPCOR that offers a wholesale water rate of 0.75¢/m3 (2010).

- EPCOR also provides electricity to the region at a rate of 12.426¢/kWh.

-Gas prices are more variable across the region.

20 All gas utilities rates are in reference to ‘small commercial’ or ‘commercial uses’. All electricity and gas rates are current as of October 2011; Capital Region Southwest Water Services Commission. 2010 Annual Report; City of Edmonton 2010. The Way We Green: Inventory of Ideas; Gas Utilities Rates. Monthly Filing. Direct Energy and AltaGas. http://www.auc.ab.ca/utility-sector/rates-and-tariffs/Documents/Natural%20Gas/Monthly/AUC%20Monthly%20Gas%20Cost%20Schedule%20-%20Web%20posting%20October%202011.pdf



-AltaGas Utilities:

$3.450/day/GJ.

-AltaGas Utilities:

$3.450/day/GJ.

-AtcoGas Utilities:

$3.758/day/GJ.

-AtcoGas Utilities:

$3.758/day/GJ.

-Direct Energy:

$3.449/day/GJ.

-Alta Gas Utilities:

$3.338/day/GJ.

Telecommunications21

-Broadband Internet access with up to 100 Mbps download speeds and up to 5 Mbps upload speeds.

-Network will be upgraded by August 2011 to allow for 250 Mbps download speeds and up to 15 Mbps upload

speeds.

-Broadband access with

up to 250 Mbps

download speeds and

up to 15 Mbps upload

speeds.

-Broadband Internet

access and capability is

identical to the City of

Leduc as offered by

Shaw.

21 A market survey was conducted for the Capital Region. Data was collected from Shaw Communications on November 1, 2011.


4.2.4 Agri-Food SectorLabour Force Characteristics – As discussed above, the City of Leduc benefits from being part of a large regional labour force in the Edmonton Region with access to a regional labour force of nearly 720,000 people. The available data indicates that wages in the Agri-Food sector are uniform across the Edmonton Region. Agricultural and Related Service Contractors and Managers, for example, earn on average $22.72/hr in Leduc County, Parkland County, and in Edmonton. Accordingly, in terms of wage rates, Leduc exhibits no advantage/ disadvantage when compared to neighbouring localities.

Transportation / Distribution - As previously described, the City of Leduc is located along Highway 2 and is serviced by Canadian Pacific Rail with two stations. Leduc is also adjacent to the Edmonton International Airport. Aside from Leduc County, there are no other localities in the Edmonton Region with comparable transport related features. Leduc is well positioned in this category.

Utilities and Telecommunications – As indicated above, the Edmonton Region offers a variety of energy and telecommunication service delivery options. In terms of electricity costs, EPCOR provides the same rate of 12.426¢/kWh across the Edmonton Region. Leduc and Leduc County are in the middle of the pack in terms of the price of gas with $3.450/day/GJ. Strathcona County offers the price of gas at $3.338/day/GJ. EPCOR provides water to the entire Edmonton Region at a wholesale rate of 0.75¢/m3 (2010).

Shaw Communications offers broadband internet access to the entire Edmonton Region. At a minimum each community is serviced with broadband with up to 100 Mbps download speeds and up to 5 Mbps upload speeds. In August 2011 Shaw upgraded its infrastructure to allow for 250 Mbps download speeds and up to 15 Mbps upload speeds. Outside of Edmonton, this increased service is only available in St. Albert. Wetaskiwin is completely disadvantaged in terms of Internet capacity; broadband access is available but at considerably lower speeds.

Property Availability and Cost – The City of Leduc, when compared to other localities across the Edmonton Region, holds no competitive advantage in terms of the average cost of serviced industrial lands. Leduc County’s Nisku industrial park has traditionally offered these lands at a relatively lower cost (for both leasing and sales).


In terms of transport related features, the City of Leduc and Leduc County are unmatched in the

But Leduc holds no competitive advantage in terms of the average cost of serviced industrial

FIGURE 4.4: CITY OF LEDUC COMPARED TO OTHER COMMUNITIES: AGRI-FOOD SECTOR

City of Leduc Leduc County Parkland County Edmonton Strathcona County Wetaskiwin


- Part of the Edmonton regional labour force of 719,400, participation rate of 74.4 and unemployment rate of 5.3 (2011).

- Average Wages for Agricultural and Related Service Contractors and Managers $22.72/hr.


-Highway 2 access.


intermodal facility in

Leduc County.

-Highway 2 access.


facilities in Nisku

Business Park.

- Location of Port

Alberta.


Airport.

- Trans-Canada

Highway access.

- CN Rail station access.


Canada Highway access


stations

-Edmonton City Center

Airport

- Proximity to Edmonton

International Airport


Canada Highway

access.


stations.

- Removed from

Highway 2.

- CP rail access.

Utilities23


-The Regional water source is the North Saskatchewan River.




23 All gas utilities rates are in reference to ‘small commercial’ or ‘commercial uses’. All Rates are current as of October 2011.


City of Leduc Leduc County Parkland County Edmonton Strathcona County Wetaskiwin

-AltaGas Utilities:

$3.450/day/GJ.

-AltaGas Utilities:

$3.450/day/GJ.

-AltaGas Utilities:

$3.450/day/GJ.

-AtcoGas Utilities:

$3.758/day/GJ.

-Alta Gas Utilities:

$3.338/GJ .

-AtcoGas Utilities:

$3.758/day/GJ.

-Water Source: Coal

Lake. Wholesale Water

rates not available.





ha.

- Total vacant



ha.



$402,000.




=$400,000.




ha.

- Total vacant



ha.



$328,000.



serviced industrial land =

$398,000.




ha.

- Total vacant



ha.



=$327,000.




ha.

- Total vacant



ha.



=$752,000.




ha.



=$493,000.




=$425,000 - $420,000.


Available.



4.2.5 Hospitality/Tourism SectorTransportation / Distribution - As previously described, the City of Leduc is located along Highway 2 and is adjacent to the Edmonton International Airport. Aside from Leduc County, there are no other localities in the Edmonton Region with comparable transport related features. Leduc is well positioned in this category. However, outside of the Edmonton Region, Red Deer and Airdrie represent potential competition in this sector (among the sample cities reviewed). Red Deer is strategically located at the midpoint between Calgary and Edmonton, along Highway 2, with an established hospitality industry. Airdrie is rather comparable to Leduc as it sits just outside of Calgary, with immediate access to the Calgary International Airport.

Quality of Life – Leduc is well positioned to benefit from business travellers rather than vacation tourists. While Leduc offers a functional downtown with historic features, the city is not a traditional ‘tourist destination’. Hotels and amenities for business travellers are important in this regard as they will benefit the local economy. Airdrie is in a similar position with a number of hotels specifically designed to accommodate business travellers.

FIGURE 4.5: CITY OF LEDUC COMPARED TO OTHER COMMUNITIES: HOSPITALITY/TOURISM SECTOR

City of Leduc Leduc County Strathcona County Red Deer Airdrie


-Immediate access to over 1

million people and growing

to 1.5 million people by

2028.

-Highway 2 access.


intermodal facility in Leduc

County.


million people and growing.

- Highway 2 access.


facilities in Nisku Business

Park.

- Location of Port Alberta.


Airport.


million people and growing


Canada Highway access


stations.

- Located on Highway 2 at

the midpoint between

Calgary and Edmonton.

- CP rail access.

- Located directly on

Highway 2 (with the highway

bisecting the city).

- Immediate access Calgary

with just over 1 million

people in 2011.

- CP rail access.

- Proximity to Calgary



Leduc is well positioned to benefit from ‘business tourists’ rather than

vacation tourists.

City of Leduc Leduc County Strathcona County Red Deer Airdrie

Quality of Life25

- Leduc Community

Hospital, CBI Health Centre.

- Leduc New Recreation

Centre.

- Functional Downtown with

surrounding residential.


$228,807, over 6,500 private

dwellings.

- Median Income Household

= $66,963.


equestrian centre.

- Mainly estate residential.


$359,271, over 4,500 private

dwellings.


= $66,036.

-Strathcona County Health

Centre



wilderness centre, and arts

and festivals.

- Well positioned in the

sports tourism market.

- Suburban areas in

Sherwood park. -Primarily

arterial commercial and

estate residential.


$323,857, over 28,600

private dwellings .


= $90,746.

- Red Deer Regional

Hospital Centre

-Several recreation centres

- Well positioned in the

sports tourism market.

- Functional downtown, WHL

hockey team, hosted world

junior hockey champions in

1995.


$244,254, over 32,600

private dwellings.


= $63,034.

-No Hospital, but various

medical clinics

– Two recreation centers

- The downtown has historic

buildings with newer strip-

mall style developments.

- A public golf course is

adjacent to the downtown

area.

- Housing is generally low

density.

- Commercial developments

are typically along highway

2.


$279,053, over 10,000

private dwellings.


= $78,097.



Summary: Industry-Specific Competitive Benchmarking

Key Highlights: A site location matrix was used as a framework to measure the relative attractiveness of competing communities

across the Edmonton Region and other communities in Alberta for similar business investment. The benchmarking framework was applied to those industry sectors, in which Leduc has a particular interest. Oil and Gas – Communities within the Edmonton Region are afforded a relatively homogenous labour force.

Leduc’s quality of life is perhaps its best asset in terms of differentiating itself from competing communities. Multi-Modal Logistics – Given its proximity to Port Alberta, Leduc is well situated to advance in this sector, but

Edmonton remains unparalleled in this area because of its size and mature logistics related networks/services. Lone Eagles – Leduc has the potential to excel in this area. Leduc is affordable; it also offers amenities and is

well connected to Edmonton by Highway 2. Agri-Food – Leduc is competitive in this sector as a result of its transportation and distribution capacity. Hospitality and Tourism – Leduc is well positioned to benefit from business travellers rather than vacation

tourists. Hotels and amenities for business travellers are important in this regard as they will benefit the local economy.


5 SWOT AnalysisAn important component of the economic development competitiveness study for the City of Leduc are the opinions of those business and community leaders and other stakeholders engaged in economic development initiatives. These leaders and stakeholders provided an excellent source of up-to-date information or perceptions on Leduc’s strengths, weaknesses, opportunities and threats that are confronting Leduc in its efforts to attract and retain business investment. A SWOT Analysis was undertaken to examine the City’s ability to support the attraction, retention and expansion of business and industrial investment and its capacity to deliver economic development services. This effort was accomplished through background research and discussions with stakeholders.

The analysis provides insight into the perceived gaps and opportunities for the City of Leduc in its efforts to grow its non-residential assessment base, inform the discussion of Leduc’s competitive advantages and disadvantages and, ultimately, inform the strategic recommendations that link economic growth opportunities to an action plan.

The key findings of the SWOT analysis are summarized in the following tables.

5.1 Leduc SWOT Analysis - General Community

Strengths

Proximity to the Edmonton International Airport. Proximity to the oil sands development projects. The Leduc Industrial Park and Nisku Industrial Park (located in Leduc County), which accommodates close to 30,000

jobs, and the second largest energy industrial park in North America (Houston`s Energy Corridor is the largest). High-quality building standards for the Leduc Industrial Park. Local economy is diversifying into industrial and commercial industries. Serviced with both CN and CP rail lines. Immediate access to highway infrastructure and part of the CANAMEX Trade Corridor. Rich agricultural lands surrounding the city. One of the most productive regions in Canada based on Gross Domestic Product per capita. A skilled and young labour force. Growing business base including self-employed business operations and businesses with employees.


Weaknesses

High costs to purchase industrial and commercial properties relative to other options in the region. High lease rates for commercial properties relative to other options in the region. Overshadowed by Edmonton and not well-known outside of the Edmonton Region. Many business executives live outside of the city. Public transportation service throughout the City of Leduc and to other communities across the Edmonton Region.

Opportunities

Located in Canada’s wealthiest province in terms of GDP per capita. The provincial economy has continued to grow considerably driven in large part to the oil and gas sector and diversified

creating opportunities in other sectors. Many of Alberta’s planned infrastructure projects (valued at over $32 billion) and oil sands projects (valued at over

$112.5 billion) will enhance the capacity for continued economic growth into the future. The Edmonton International Airport will have the capacity to support more than 9 million passengers and provide more

flights to national and international destinations. The Edmonton Region is known around the world for expertise in the oil and gas industry. Collaborate with industrial land owners to achieve mutually beneficial community and business goals. Attract commercial/retail investment and become a regional shopping destination. Port Alberta could integrate multi-modal and other logistics facilities across the Edmonton Region. Partner with developers to improve the marketing of industrial areas.

Threats

Volatility of the oil and gas prices can slow down production and delay prospects for new investment projects. Delays in getting the 65th Avenue interchange completed in a timely manner. Delays in taking advantage of opportunities along Highway 2 before they are developed elsewhere in Leduc County`s

planned development projects or in south Edmonton.


5.2 Leduc SWOT Analysis - Industry Specific5.2.1 Oil and Gas Related Sector

Strengths

Proximity to the oil sands. The Leduc Industrial Park and Nisku Industrial Park (Leduc County), which accommodates close to 30,000 jobs. The local skilled workforce from the contractors to the industrial designers. Nearly one-quarter of Leduc’s business base is linked to the oil and gas-related sector. A diverse representation of oil and gas related industries in construction, support activities, professional services

and fabricated metal manufacturing. Strong growth in the number of new businesses. Leduc and Nisku are considered to be the centre of the oil and gas industry for construction skills and business

services. Proximity to the airport – businesses want to move goods in and out very quickly.

Weaknesses Many of the businesses in this sector are construction related with only a comparatively small representation of

high value added professional services businesses.

Opportunities

Rising price of oil over the previous decade has made the oil sands development projects a very attractive location for global business investment. An especially good location for future investment as it is located in a developed and stable economy.

Over $112.5 billion of capital investment projects are directed towards oil sands projects. Oil companies such as Shell Canada are building their own airports near the oil sands to transport workers. Create greater awareness of the strong business opportunities to global investors.

Threats Volatility of the oil and gas prices can slow down production and delay prospects for new investment projects.


5.2.2 Multi-modal Logistics Sector

Strengths

The Nisku Industrial Park, located in Leduc County, which accommodates 15,000 to 17,000 people. CP Rail is located nearby and is part of the Pacific Gateway. Immediate access to highway infrastructure and part of the CANAMEX Trade Corridor. Linkage with the Port of Prince Rupert on the Pacific Ocean. A strong concentration of truck transportation companies.

Weaknesses The sector has grown marginally in terms of the number of new businesses, which may be a reflection of the lack

of transportation access off of 65th Avenue.

Opportunities

The Edmonton International Airport will have the capacity to support more than 9 million passengers and provide more flights to national and international destinations.

There is a large supply of land for industrial and limited commercial uses to host the supply, distribution and storage of goods.

Port Alberta could integrate multi-modal and other logistics facilities across the Edmonton Region.

Threats Rising energy costs are driving up the cost of transporting products over long distances. CP Rail will have an intermodal yard on 41st Avenue and CP will begin to sell its lands around the yard.


5.2.3 Lone Eagles

Strengths

Immediate access to highway and airport infrastructure. Access to a network of community colleges and universities in Edmonton. Diverse representation and growing number of self employed people. An agri-value processing business incubator in the city that supports the growth of new companies and business

ventures.

Weaknesses Entrepreneurial support networks are located in Edmonton.

Opportunities Many residents commute outside of Leduc for employment opportunities.

Threats Starting a new business or self-employment has associated risks and revenue generating uncertainty.


5.2.4 Agri-Food Sector

Strengths

A fresh water supply. An agri-value processing business incubator in the city that supports the growth of new companies and business

ventures in the agri-food sector. No machinery and equipment tax. Rich agricultural lands surrounding the city.

Weaknesses There is marginal business concentration growth in this sector among businesses that can provide value added

products/services, either provincially or federally inspected businesses. There is a need for local cold storage facilities nearby.

Opportunities

A $10.7 billion a year industry in the Province and one of the few industries that has shown continued growth since 2007.

Rising energy costs are creating opportunities to process food and distribute food locally. Food research as part of the agri-value processing business incubator.

Threats Rising energy costs are driving up the cost of transporting food over long distances and growing food. The cold storage facility may be developed in proximity to multi-modal distribution centres rather than in Leduc.


5.2.5 Hospitality/Tourism Sector

Strengths

Proximity to the Edmonton International Airport. The city offers some festivals and cultural events. Large number of hotel rooms (2,000-plus rooms) for a community of its size. The 309,000 sq. ft. Leduc Recreation Centre offers multi-use recreational facilities (e.g. hockey arenas, indoor

soccer fields, basketball courts, an aquatic centre, curling complex, fitness centre). Business concentrations (i.e. food services and accommodation services) have grown over previous years. Regional recreational assets include Castrol Speedway and Telford Lake.

Weaknesses Sector remains small in terms of business concentrations. The wage compensation is not nearly as high as compensation in the oil and gas related sector.

Opportunities

Estimated $5.4 billion industry, with nearly half of spending directed towards accommodation, food and beverages. Over half of the sector’s spending is coming from Albertans visiting other parts of Alberta. Edmonton and Area is second largest in Alberta with estimated $1.4 billion in tourism spending. The Edmonton International Airport is a key point of entry for business travellers/ visitors/ tourists. The Edmonton International Airport will have the capacity to support more than 9 million passengers and provide

more flights to national and international destinations. Nearly 55,000 vehicles per day travel along Highway 2 in proximity to the City of Leduc. Collaborate with industrial land owners to create a larger hospitality sector. Oil and gas sector can draw business travellers from China, South Korea, Germany and the United States. The large recreational centre in Leduc provides the venue for sports tourism events. Tap into the conventions market since there are a large number of business travellers to the region. Destination Marketing Fees (DMFs) could provide more funding to support marketing. Access tourism funding grants that support rural areas.

Threats

The United States travellers’ tourist market has matured and these travellers need passports to enter into Canada. Ongoing strength of the Canadian dollar versus many foreign currencies, especially the US dollar. Ongoing public relations campaigns by environmental organizations to discourage travel to Alberta. Rising energy costs are driving up the cost of travelling over long distances.


6 Leduc’s Competitive Advantages and Disadvantages

Moving from the current conditions that have shaped Leduc to positioning the city for economic growth requires a clear articulation of competitive advantages and disadvantages. These advantages and disadvantages will be used to inform the strategic recommendations and actions.

6.1 General CommunityLeduc has many assets to support economic development. Generally, the city offers an accessible location for business investment in terms of transportation linkages, available land with sound building and taxation policies and affordable home ownership. However, the city is removed from Edmonton, the central focus of economic activity in the region and offers little cost advantage in comparison with other suburban Edmonton communities.

FIGURE 6.1: LEDUC’S COMPETITIVE ADVANTAGES AND COMPETITIVE DISADVANTAGES

Competitive Advantages

Accessible Location Immediate proximity to the Edmonton International Airport., CANAMEX Trade Corridor, rail lines and highway network. Proximity to oil sands development projects

Available Land / Sound Building and Taxation Policies Available land in the Leduc and Nisku Industrial Park. Flexibility in zoning to accommodate different types of non-residential development. No property taxation on machinery and equipment.

Affordable Housing Lower average home values relative to household income.


Competitive Disadvantages

Removed from Edmonton, the central focus of economic activity. Edmonton is the central focus of economic activity and investment into the region since there is a large population base, large

labour force base, many available land assembly options, a sophisticated network of health care services and many entertainment and recreation centres.

The City of Leduc is projected to remain a small city in comparison to Edmonton in terms of population base.

No cost advantage in the suburban Edmonton communities Comparatively high non-residential tax rate and high tax dependence on the residential property tax. Comparatively high average price for serviced industrial land per acre in suburban communities.

Vehicle Reliance Lack of public transit service in Leduc and to other communities has created a culture of vehicle reliance.

6.2 Sector Specifically This section focuses more specifically on Leduc`s sector competitive advantages. Leduc`s proximity to Edmonton is a key competitive advantage due to Edmonton`s population base. In all sectors, the City of Edmonton due to its population has a much larger concentration of businesses. The City of Edmonton also has the post-secondary educational institutions that can develop the labour force to support growth and sophisticated business and entrepreneurship support networks that can nurture growth. Leduc will need to develop its key sectors in alignment with Edmonton.

Oil and Gas Related Sector: Leduc`s main competitive advantages for the oil and gas sector are the large concentration and diversity of firms servicing the oil and gas extraction industry and access to a highly skilled labour force and network of colleges and universities in the Edmonton Region .

Multi-modal Logistics Sector: Leduc benefits from being in immediate proximity to the CP Rail multimodal yard in Leduc County that can allow for products to be shipped beyond the Edmonton Region market and across North America and beyond . Leduc has a stable business base in this sector and a large number of trucking firms.

Lone Eagles: There is large representation and growth among Lone Eagles across the goods based and services based industries. Specific industries where Lone Eagles have grown in high numbers are in professional, scientific and technical services, construction and real estate and rental and leasing. However, these Lone Eagles, or entrepreneurs, are at a


competitive disadvantage as they are somewhat removed from larger entrepreneurship support networks that are available in the City of Edmonton, such as a TEC Edmonton business accelerator.

Agri-Food Sector: Leduc’s main competitive advantages are the large representations of agricultural goods producers operating on the fertile lands surrounding the city, access to a consumer market that will grow to 1.5 million people, a fresh water municipal source and the presence of an agri-value business incubator to help start-up businesses in this sector expand. However, there remains a small number of firms in Leduc that are further down the value chain and in food and beverage manufacturing, wholesaling and distributing.

Hospitality /Tourism Sector: Leduc’s main competitive advantage is the large representation of businesses in hospitality driven industries that support business travellers to the Edmonton area. There a large number of businesses in food services and accommodation services as a result of the proximity to the Edmonton International Airport, a key point of entry for business travellers and tourists. The new Leduc Recreation Centre is an added advantage for the city as it can offer a venue for festivals and sporting events. However, this sector lacks depth in terms of arts, recreation and entertainment businesses and offers few reasons to extend visits to the Leduc area.

These community and sector-specific competitive advantages and disadvantages confirm the importance of the City of Edmonton’s economy and the linkage with the Edmonton International Airport with the City of Leduc’s economy. The following section will explore the local and regional economic development ‘ players’ in the Edmonton Region and their economic development and marketing services delivery approaches.


7 Economic Development Services Delivery No matter what community, there are always many forces and organizations involved in economic development activity. This is easy to understand when one looks at the variety of projects that are considered to be “economic development.” These include delivering services for small businesses and entrepreneurs, business investment attraction, business retention and expansion, tourism marketing, workforce development, community beautification, downtown revitalization and hosting major events.

This section includes a matrix that identifies the economic development initiatives that are being undertaken in Leduc and identifies which organizations are responsible. In addition, this section explores the logic behind pan-municipal organizations and offers recommendations on the role the city should take.

7.1 What is Economic Development?Non-residential development is critical to the development of a community’s “basic” (export-oriented) and “non-basic” (population-related) economy. Continued growth in non-residential assessment is vital to have balanced and complete communities.

Definition of Economic Development: Economic development is rooted in the premise that initiatives must ultimately increase the total wealth within a community. There are two main ways to do this:

1. Export Development – any initiative that brings new money into the community:

starting/attracting a business that sells products/services outside the community

attracting visitors who then buy local products/services

encouraging existing business to sell their product/service outside the community.

2. Import Substitution – any initiative that keeps money in the community:

encourage people and businesses to buy their goods/services locally rather than importing them from another community

starting or attracting new businesses that recognize the leakage and provide a product/service to stop it.


Export Development and Import Substitution activities are economic drivers – they bring in the wealth. Other activities are redistributors – they circulate the money within a community. Strong economies bring in new money and then keep it

in the community as it moves from business to

These two philosophies form the fundamental direction for economic development programs. If economic development programs are meant to increase wealth in the community (and for the community) then initiatives should be directed to improving export development (primarily) and improving import substitution (secondarily).

7.2 Leduc’s Economic Development ‘Sandbox’No matter what community, there are always many forces and organizations involved in economic development. The purpose of this sub-section is to ultimately decide which direction to take the City’s services. The following table identifies the economic development initiatives/projects that are currently active in Leduc and identifies their key focus.

Glossary of terms found in the following table:

Investment Attraction – Identifying target markets and promoting the area for the purposes of attracting commercial, industrial, residential or institutional investments

Business Retention and Expansion – Identifying concerns of the local business community and addressing them in an effort to improve the local business environment

Small Business Development – Counselling, training and financing services to new entrepreneurs or existing small businesses facing challenges of growth or decline

Infrastructure and Planning – Includes enhancing the physical infrastructure of the community (e.g. roads, utilities, telecommunications) and completing Community Plans and Zoning Bylaws

Work Force Development – Identifying and addressing weaknesses in the local or regional labour force Tourism Marketing – Promoting the area to visitors and providing visitor services Tourism Product Development – Enhancing the location (i.e. the product) in order to make it more enticing to

prospective visitors including developing events and festivals.


FIGURE 7.1: CURRENT CORE PRIORITIES OF ORGANIZATIONS SERVING THE CITY OF LEDUC

Organization

Inve

stm

ent

Attr

actio

n

Bus

ines

s R

eten

tion

&

Expa

nsio

n

Smal

l B

usin

ess

Infr

astr

uctu

re

& P

lann

ing

Wor

k Fo

rce

Dev

elop

men

Tour

ism

M

arke

ting

Tour

ism

Pr

oduc

t D

evel

opm

en

City of Leduc26

Leduc-Nisku EDA

Leduc Regional Chamber of Commerce 27

Leduc Agri-Value Business Incubator

Capital Region Board

Edmonton International Airport/Port Alberta

Capital Region Community Futures

Greater Edmonton Economic Development Team

Edmonton Regional Tourism Group

Provincial Government28

Federal Government29

Groups not identified include University of Alberta, Grant MacEwan University and other post-secondary institutions involved in workforce development and many organizations involved in tourism product development including festivals.

26 Includes Sport/Agriculture Tourism, Planning, Public Works, Engineering and Parks/Recreation/Culture27 The Leduc Regional Chamber of Commerce does not initiate BR+E projects, but they do provide services or workshops that address business concerns that may have a direct bearing on business expansion plans.28 Includes Ministries of Agriculture & Rural Development, Treasury Board & Enterprises, Transportation, Education, and Tourism/Parks/Recreation29 Includes Foreign Affairs and International Trade, Services Canada and Industry Canada.


7.2.1 How Other Municipalities Work in a Multi-Jurisdiction SettingWith all these organizations playing in the sandbox and some overlapping responsibilities evident, at first glance it looks to be difficult to find an appropriate place for the City to operate. However, Leduc is not alone and can learn from others’ experience. Nearby communities such as Devon and Beaumont provide economic development services despite being in a multi-jurisdiction setting. The following figure shows how they have organized their services within this environment.

FIGURE 7.2: DEVON AND BEAUMONT IN THE THREE-TIERED STRUCTURE


Upper Tier: Greater Edmonton Economic Development Team- trade show marketing for the 25 municipal members in greater Edmonton, on a pay per opportunity basis

- lead generation and coordination

Middle tier: Leduc-Nisku EDA- branding and marketing activities for 7 members

- undertakes foreign trade missions on behalf of member communities- organizes networking and information sharing events

Lower Tier: Town of Devon- respond to leads generated by the GEEDT and the EDA

- business retention, expansion and attraction

- local workforce data- land availability and business

land development

Lower Tier: Town of Beaumont- respond to leads generated by the

GEEDT and the EDA- business retention and expansion

- local workforce data- land availability

- information sharing with localbusiness

Lower Tier: City of Leduc

The Towns of Devon and Beaumont each have their own economic development services in addition to the services provided by their partnership with the Leduc-Nisku EDA and participation in the Greater Edmonton Economic Development Team. (Refer to Figure 7.3).

Each town has taken on traditional economic development roles by providing local data on business establishments and workforce statistics and maintaining databases regarding land and industrial property availability. They also work closely with developers to ensure new properties are available for new business. Their respective Chambers of Commerce work with local businesses on retention and expansion issues and the Towns maintain a close relationship with these organizations.

FIGURE 7.3: LOWER-TIRED ECONOMIC DEVELOPMENT BUDGET AND EMPLOYEE COMPARISON, 2011

Municipality Operating Budget Financial Support to the Leduc-Nisku EDA

Staff Complement (Full-time Equivalent)

Town of Devon $500,000 $13,000 3.0

Town of Beaumont $275,000 $20,000 1.0

City of Leduc * * *

* Note: City of Leduc’s economic development budget is allocated across different programs/projects.

Devon’s office (operating budget of $500,000 in 2011 including ~$13,000 to the EDA) has a part-time contractor to do business development and attraction (relatively new position) including cold calling. Historically, the most significant role is in tourism product development and marketing. There is also funding allocated for assisting existing businesses (e.g. business visits, workshops) and enhancing the downtown through the use of capital improvements. The Town has recently posted for a position of Director, Community and Economic Development for the

newly formed Community and Economic Development Department. This position will have senior management level responsibilities with a focus that includes retention, attraction and growth of the business interests as well as pursuing residential development and tourism opportunities.

Beaumont’s $275,000 economic development budget (2011) includes staffing costs and $20,000 for the EDA. There is a particularly strong focus on entrepreneurship and small business development due to the


sense that this service is not delivered well in Beaumont. Capital Region Community Futures has some local presence through webinars and seminars but one-on-one contact is difficult because their office is located an hour drive away in Stony Plain. The economic development office provides start-up and expanding business owners with spreadsheets and documents to help with business planning, links on where to get information on their industry, help on getting loans and grant money, etc. This has a spinoff impact of creating a better relationship with the local business community.

7.3 City’s Role: Do Nothing? Not Recommended. Based on consultations with the community and conversations with the project steering committee it has become very clear that tax assessment and job growth are high priorities for Leduc. By extension, efforts that will encourage export development and important substitution should be budget priorities.

This is not to say that the existence of a Leduc economic development office would guarantee these results. However, an adequately funded and professionally-staffed economic development office would be Leduc`s best bet to deliver increased economic growth. Implemented properly, the introduction of a city-level economic development office can help Leduc-Nisku EDA initiatives to be more successful while taking local grassroots initiatives to new heights.

7.4 Leduc’s Responsibilities / Service Gap AnalysisOverall, there are plenty of opportunities for growth and existing barriers to economic growth that warrant a proactive economic development effort. The citizens and businesses of Leduc would be well-served. Based on the above analysis and observations, recommendations are made on services that the City should consider undertaking. Figure 7.4 indicates where the City should and should not provide core services to achieve maximum efficiency and effectiveness.

Having a core responsibility means the City will be proactive in identifying challenges and opportunities, developing projects that will lead to growth/diversification, finding partners needed to make it successful and implementing the ideas.

Where it is recommended Leduc not take on a core responsibility the City will be reactive to opportunities that come its way. These projects will be developed by other organizations and will look to the City for support in a variety of ways including financial, advisory and as a symbolic partner. The City should evaluate the merit of these opportunities on an individual basis.


FIGURE 7.4: RECOMMENDED DELIVERY OF ECONOMIC DEVELOPMENT SERVICES

Service Existing Gap? City Core Responsibility?

Tourism Product Development: Hospitality/Tourism Investment Attraction

Yes Primary

Investment Attraction: Downtown-related Yes Primary

Business Retention & Expansion Partially Primary (as it supports above)

Investment Attraction: Professional services related to oil and gas, agri-food, transportation/logistics

Partially Primary (support to EDA)

Infrastructure and Planning: Aerotropolis, Port Alberta No Secondary

Investment Attraction: Lone Eagles Partially Secondary

Small Business Assistance Partially Secondary

Tourism Marketing No Yes (agriculture/sport tourism office)

Labour Force Development Yes No

The City of Leduc`s current economic development function is in infrastructure development, planning and sport/ agriculture tourism. The City’s economic development function should not duplicate existing economic development functions – it should complement existing City responsibilities and the work of other economic development stakeholders unless their work is not adequate. These functions are identified in the table below.


FIGURE 7.5: RECOMMENDED CORE/PROACTIVE CITY SERVICE RESPONSIBILITIES

Service Rationale Examples of Initiatives

Investment Attraction: Hospitality/Tourism

There are 2,000-plus hotel rooms in Leduc, far more than most communities of its size. The City should be able to leverage this clout into more restaurants and entertainment. In addition, the City should explore the opportunity of destination marketing fees (DMF).Diversifying the range of accommodations could be an option with the prospect of smaller inns, especially in the downtown.

Develop value propositions and key messages that focus on the main strengths as identified herein.

Explore destination marketing fee opportunities. Based on the target market develop an proactive promotional

campaign

Investment Attraction: Downtown-related

The City has invested significantly into the revitalization plans for downtown and put capital funds towards some physical improvements. Ultimately, the project will only be successful if the private sector is involved. The project needs a “salesperson” to generate interest from the private sector and ensure their proposals proceed in Leduc – not somewhere else. The project will directly support employment and taxation but the biggest impact will be on how it improves quality of life in Leduc and spurs more commercial, industrial and residential growth.

Identify three private sector developments or redevelopments that will bring significant benefit to the downtown, identify who investors could be and pursue.

Ensure the City’s downtown plans are reflected in promotional messages on the website.

Ensure the downtown interests are understood and impacts are considered with suburban development.

Aim to become investment ready by having current and readily available economic data, sector and community profiles, listings of available property and feasibility studies or business cases for residential and non-residential investment opportunities.

Business Retention & Expansion

Research shows that existing businesses create 70-80% of new employment. The role of the EDA in the past has been to support existing businesses that are, generally speaking, in the Leduc Business Park. This function may continue. Regardless, the City can play a strong role in supporting its existing businesses in the hospitality/tourism sector and those that are downtown to ensure growth stays in Leduc.

Have an internal investment retention response team who will immediately be able to assist in overcoming “red flags” that are identified by business owners. The team should include representatives of planning, utilities and transportation.

Both the EDA (at least in the past) and the Chamber have developed strong networking programs. The City should not take on an event management role, but it should suggest topics and guest speakers for networking events.

Section contains much more detail on how to build an effective business retention and expansion initiative.



Investment Attraction: Professional services related to oil and gas, agri-food, transportation/ logistics

The EDA has traditionally played the main role in attracting investment in secondary industries (e.g. manufacturing) and those that support secondary industries (e.g. oil and gas services and transportation/logistics). Based on the competitive analysis done above, the City needs to emphasize to the EDA that their target markets need to include professional services related to oil and gas (e.g. architecture, engineering, geomatics, surveying) and agri-food if they are going to meet the city’s needs. Leduc can support the EDA’s efforts by preparing competitiveness data that can be used as sales tools, being ready to quickly provide specific information that is requested by prospects and being able to present to the client when the EDA has developed a prospect to the point they are ready to tour the city.

Have an internal investment attraction response team who will immediately assist in answering questions required of the city by the prospect. The team should include representatives of planning, utilities and transportation.

Ensure the EDA is promoting sectors that are of interest to the city, especially professional services related to oil and gas, agri-food and transportation/logistics.

Aim to become investment ready by having current and readily available economic data, sector and community profiles, listings of available property and feasibility studies or business cases on investment opportunities.

Establish partnerships and work closely with planning staff to identify opportunities for underutilized and vacant properties as well as brownfield properties.

Actively participate and shape the Capital Region Local Food Initiative to strengthen regional economic development relationships and provide a role for the City in growing the agri-food sector across the region.

Infrastructure and Planning: Aerotropolis, Port Alberta

Of all the projects that are being worked on at the moment, these two have the most potential of stimulating significant economic development. Many people in the city are already involved and will need to continue to be involved. It would be easy for these two projects to swallow up all of the economic development resources so caution is required. However, there can be an important role to play in adding a pro-development voice to the argument.

Continue to lead and/or participate in discussions that will shape the Aerotropolis and Port Alberta concepts.

Recognize the future of industrial lands north of Telford Lake as having the potential for higher end business park uses and begin planning in that direction.

Investment Attraction: Lone Eagles

Lone Eagles are the perfect fit for Leduc’s efforts to expand its business base into professional services and bringing in a sustainable population base that will support downtown redevelopment. It is a secondary initiative because it will not have the economic impact of the other initiatives. At the same time, it supports the City’s efforts to grow the residential population base.

Supplement the City websites with messages about opportunities to locate small businesses into Leduc which offers an unbeatable living environment.

Enhance the existing residential development campaign to direct the message to Lone Eagles.



Small Business Assistance

There is no question that small business needs support to grow. The question here is a matter of resources. Beaumont has shown that it can have a positive effect on small business growth but the City must weigh where it puts its resources. Unlike Beaumont, Leduc has significantly more potential in the industrial sectors identified above. For that reason, this activity is considered secondary.

Make strong efforts to have Community Futures more active in Leduc including the establishment of a satellite office. To assist, work with them to build the profile of their services through city media such as website, newsletters, etc.

Tourism Marketing

The City already has put resources towards agriculture/sport tourism and from all reports that initiative is doing tremendously well based on the economic impact assessments that have been done following events, it has been possible to see the positive impact. Continue to support it.

The Chamber looks after broader visitor services and while more can be done it is recommended that the City not allocate more human resources to the initiative.

Continue separate agriculture/sport tourism initiative. Pursue other aspects of tourism marketing and product

development

Labour Force Development

The presence of an appropriate labour force is a huge reason why businesses invest where they do. There is no question there are pressures on labour force in Leduc. However, the challenges are more effectively dealt with at a higher level. The EDA, at a minimum, or more likely a group that has the Edmonton Region’s interests in mind should be looking to improve the regional labour force situation in the short and long-terms.

Connect the information discovered during the business retention and expansion program above to encourage interest in developing programs that will match employers’ needs. Being able to obtain this type of information alone is reason enough for secondary and post-secondary institutions to financially support the retention program.

The City should build value propositions based on the community`s general and sector specific competitive advantages. From the competitive advantages outlined in this report, the city should be developing marketing strategies and tools to promote the growth and development of these sectors

Comprehensive sector profiles should clearly illustrate the city’s competitive advantages and value proposition for business investment in each of its target sectors. This should include a well-developed understanding of key firms in the region regarding:


the global reach and influence of these companies the level of innovation and commercialization efforts that is occurring the extent of and investment in research and development that is being lead or developed by the city’s business

community the extent and type of collaborative and partnership efforts that are being supported locally the development and deployment of new technologies the level of supporting infrastructure in the community.

This information should form the basis of key messaging presented in marketing and promotion brochures. Ensure the profiles include a talent-focused branding component and convey a sense of authenticity and credibility that comes from having local businesses and entrepreneurs tell their ‘stories’.

7.4.1 Model for Investment Attraction Service DeliveryPeople who were engaged in consultations generally paid more attention to investment attraction than any other aspect of economic development. This is not surprising given investment attraction is most certainly the “sexiest” aspect of economic development given the prospect of big headlines in the local people announcing the new jobs and tax assessment that are coming to town. It was also a very topical point of conversation given the staffing changes taking place at the EDA and the organizational review that was taking place at the same time as this project.

Investment attraction is an expensive and time consuming proposition. Also, successes are few and far between. It is often said that it takes 100 leads to develop a warm prospect and only one in every 10 warm prospects eventually brings investment. That effectively means you need 1,000 hits to generate an investment. While large communities can afford to have their own integrated investment attraction programs, it is normally best for smaller municipalities to partner with their neighbours in marketing. This process is called “co-opetition” because while there is initial co-operation to generate investment leads, eventually there is competition between municipalities to land the investment. The thinking goes as follows: the first preference is to have the investment in your own community, but the next best thing is to have it next door.

An economic development service delivery concept that has been regarded by economic development professionals as a best practice model is the Eastern Ontario regional approach to investment attraction. Utilizing a three tier approach, communities such as the City of Quinte West have been able to benefit from various levels of activity, branding and research that has allowed them to pursue various strategies that they would not otherwise have been capable of doing alone.


The following figure shows how the process works. Consider this when reviewing:

The City of Leduc is equivalent to the City of Quinte West The Leduc-Nisku EDA is equivalent to the Quinte Economic Development Commission The Greater Edmonton Economic Development Team is equivalent to the Ontario East Economic Development

Commission

FIGURE 7.6: CITY OF QUINTE WEST ECONOMIC DEVELOPMENT SERVICES DELIVERY MODEL


City of Quinte West Economic Development Services: The economic development services provided by the City of Quinte West are largely focused on the small to medium businesses in the city. As a result, their activities are primarily business retention and expansion, with a particular focus on the marketing and improvement of the downtown area. They also promote land and office availability with a local mapping system and represent the City at various national and international events.

Along with the City of Belleville and Municipality of Brighton, they pay a per capita levy to the Quinte Economic Development Commission (QEDC) so that the QEDC can look after investment attraction and some forms of investment retention (exclusively in the manufacturing sector) on their behalf. The City supports QEDC’s activities by providing local information on utilities, industrial land availability, workforce statistics, etc. as well as ensuring the city has investment ready industrial land.

The City also participates in the Ontario East Economic Development Commission (OEEDC) in initiatives that are outside the QEDC’s core mandate. An example of this is the OEEDC’s Tourism Investment Team, which aims to attract hotels, resorts, tourist attractions and other tourism products to the Eastern Ontario.

Quinte Economic Development Commission: As mentioned above, the QEDC represents Belleville, Quinte West, and Brighton. It focuses on larger industries, mainly in the manufacturing and technology sectors. The organization has identified a number of target investment sectors and pursues leads on behalf of its three partner communities. It constantly evaluates whether it is more beneficial to promote itself independently or as part of Ontario East. For instance, any trade show or investment mission that is further afield where the name “Quinte” would be a foreign concept, they participate with Ontario East. However, they will independently contact real estate brokers, site selection professionals and provincial/federal investment representatives because the brand is well understood by those intermediaries. Investment prospects who are generated by the QEDC are “worked on” by the QEDC (i.e. QEDC remains the main point of contact) but QEDC will call on the local municipalities to help answer questions on utilities, planning, infrastructure, etc.

As a member of Ontario East, the QEDC receives leads from the larger organization, and works independently with its member municipalities to help them prepare individual proposals, provide objective assistance and collect sector data.


In terms of business retention and expansion, the Quinte EDC has developed, in partnership with its member communities, a number of reports on issues such as regional labour analysis and research on workforce development. They have created a Manufacturing Resource Centre, a centre for manufacturers looking to add value to their products, access funding programs and coordinate development activities. This centre also takes on an important role in workforce development, by providing an online local job and resume bank and developed apprenticeship and immigrant participation strategies.

QEDC has a separate Board of Directors but prepares presentations for municipal councils regularly and provide up to date information for new investments and job creation.

Ontario East Economic Development Commission: The OEEDC promotes Eastern Ontario as a centre for investment by pooling economic development funds from its community members and coordinating their efforts to generate leads and awareness. The organization is highly member focused, which is demonstrated in its governance structure. Both the President and Vice-President positions are filled yearly by election, allowing all members the opportunity to hold leadership roles. Members purchase a basic membership (several hundred dollars) as well as a “Team” membership (several thousand dollars) for certain sectors, such as food processing, advanced manufacturing and transportation/logistics. Teams have the opportunity to attend sector specific events as members of Ontario East to generate leads and represent the region.

The Commission’s staff provides communications, branding, and coordination services to its many members, who are able to participate in events and marketing they may not have been able to afford independently. Target activities for the Commission include the general branding and marketing of the region to provincial, national and international interests, lead generation, activity coordination, and follow-up. Leads are provided to members, who provide proposals for the client. The organization has been successful in creating a profile for the region, and has also undertaken numerous research initiatives to provide improved data and strategic insights to its members.

Here is a suite of promotional materials put out by these organizations. It is evident how Quinte West, QEDC and OEEDC all understand their roles but work together.


FIGURE 7.7: ONTARIO EAST AND QUINTE ECONOMIC DEVELOMPENT PROMOTIONAL MATERIALS


7.4.2 Best Practice Business Retention and Expansion InitiativesAs part of its RFP for this project, the City requested details on developing a business retention and expansion initiative. Why should a Business Visitation Strategy (also commonly known as a Business Retention and Expansion Strategy) be a part of the City of Leduc’s activities?

1. First and foremost, existing businesses create jobs. Research studies have clearly shown that existing businesses create the majority of employment growth in both growing and stagnant economies. The figure to the right is from research completed by Blane Canada Ltd. which indicates that 76% of new jobs come from existing businesses, 15% from new businesses that have recently entered the community and 9% from new business start-ups.

FIGURE 7.8: JOBS AND CAPITAL INVESTMENT

Existing Businesses

76%

Attraction15%

Entrepreneurship

9%

Source: Blane Canada Ltd.

2. Existing businesses already have a stake in the community and are demonstrably contributing to the economic vitality and social fabric of the community.


3. Business owners know that it is easier and less expensive to retain existing customers. The same thing is true for communities that focus on retaining existing businesses.

4. Keeping what you have is good for the development and growth of smaller firms. Businesses that export goods and services generate the revenue that funds smaller, local, service businesses. Both types of firms are necessary and the service firms may not survive if the exporting firms close or move away.

5. Every economy loses about 10 percent of its jobs annually due to retirements, business closings, product life cycles, etc. Existing businesses are best positioned locally to replace those jobs.

Existing Businesses Are Also Ambassadors for Industry Recruitment: The ladder figure to the right is analogous to the increasing ‘commitment’ of businesses to the community. The objective should be to get every business to be an advocate of the City of Leduc. No longer are business owners just doing business in the community and creating jobs and paying taxes, but they are talking positively to their business peers about the merits of establishing in Leduc. This is the ultimate in testimonials.

6. Building on existing community business strengths has proven to be a successful industry recruitment strategy.

7. Finding and fixing problems for existing businesses may identify businesses for targeted recruitment efforts.

8. Satisfied existing businesses can be a community's best ambassadors when recruiting new firms to the area as well as serving as a source of leads when seeking new firms to recruit.

9. If an existing business is a thriving and growing concern, or is viewed as having growth potential, it may be the target of recruitment activities by another community. Thus it is in the best interests of local communities to make every effort to retain them.


7.4.3 Characteristics of Great Business Visitation StrategyAs Leduc considers business visitation as a growth strategy, it should keep in mind the following characteristics that make a great Business Visitation Strategy.

Partners: It is apparent that other community partners would benefit from the business visitation process, the competitive intelligence that comes from the responses and being associated with a broad outreach as this. They should be approached for sponsorship and participation. Sponsorship carries an obvious financial benefit to Leduc by offsetting some costs but participation is potentially the most valuable because it broadens the number of businesses who can be involved. Potential sponsors include: Community Futures Capital Region, Leduc Regional Chamber of Commerce, Agrivalue Processing Business Incubator and secondary and post-secondary education institutions.

Aim for statistically significant sample size: Based on the type of analysis that was done above based on just 34 companies, imagine the comprehensive nature of the analysis and the relevance of the analysis across the entire community or subsector if the sample was statistically significant. For example, if it was determined that an important subsector of the local economy had 200 businesses (or one of the townships for instance), it would take a sample of 132 surveys to achieve a 95% Confidence Level and a 5% Margin of Error. Reaching this plateau makes for very compelling strategic planning and making arguments to funding agencies or governments based on what the business community has stated. It is also potentially great public relations for the municipality.

Survey Improvements: Blane Canada Ltd. has identified several different types of questions which are useful in understanding so that survey size can be minimized, but still be effective:

Confirmation Questions should be minimized on the survey. Information about parent company, products, employment, union, wages, real estate, etc. should be gathered in advance of the personal interview or survey. This background information can be collected from a variety of company employees with a simple phone call, thereby freeing up time with the executive for more important issues.

Assistance Questions often lead to awkward moments and frustration. For example, to solve a traffic problem requires both local government and perhaps state government. Since these are not under direct control of the Economic Development Branch, others must initiate corrective action. If they choose not to act or cannot for whatever reason, even after being asked, the Economic Development Branch fails in the eyes of the business executive. This is true of many of the “assistance offers” made by development


organizations. Therefore, assistance questions should be minimized on the survey and those that are raised should be under the direct control of the interviewer’s organization.

Problem Identification Questions are an important part of the Economic Development Branch’s purpose in conducting company interview/survey programs. For example: “Are there any barriers to your company’s expansion in this community?”

Predictive Questions are woefully inadequate on all surveys evaluated. The only predictive question, if asked, is “Does the company plan to expand?” This is an important question, but not the only important question that should be raised. Predictive questions should help the Economic Development Branch anticipate both positive and/or negative changes that could impact the company. R&D activity, new product introductions, future market opportunities, and emerging technology are representative of issues providing predictive information. Predictive questions are an opportunity to begin identifying companies with growth potential or possible risk of job loss. For example: “As a percentage of sales, how much does the company invest in research and development?”

Industry Intelligence Questions help an Economic Development Branch understand the competitive environment in the industry where the company competes. It is important to have at least three industry intelligence questions to explore industry trends, international competition, overseas production and other issues. For example: “Is overseas production by competitors increasing, stable, or decreasing?”

Company Information Questions should constitute nearly 30 percent of the survey questions to learn about the company and its operations. Management practices, markets, new products, and technological changes are all important issues which should be explored. Many of these questions will be related to predictive questions to help understand where a company is going in the future. For example, “What is the company’s fastest growing geographic market?”

Buyer/Supplier Linkages Questions have been talked about for years in economic development. Yet, the vast majority of survey instruments fail to ask about potential buyers or suppliers that could be approached for investing in the community. One or two questions of this type should be in every survey instrument. For example: “Are there any buyers or suppliers that could benefit from being located closer to your operation?”


Business Intelligence: Take some time prior to each interview to research the company and the sector of business it is in so that rapport with the business owner can develop more quickly.

Reporting Back: When reporting the findings of the analysis: keep it simple, be factual, engage for change, recognize the supporters, be measurable and share. Any large document such as this one that is produced for the project should be accompanied by a 4-8 page summary document and a presentation to those involved.

Interview Methods The interview process would ideally involve two field personnel for each survey interview, one who will

conduct the interview by asking the questions and the other who will record the answers. Leduc may consider the use of partners (as described in the first bullet above) or the use of volunteers – members of the community at large that have a particular interest in business development in the community. This latter tactic has worked very well in many communities.

“Blitz Nights” have worked well in some communities. This is an excellent way to increase the numbers of surveys completed. Essentially, Leduc would organize an evening where there would be multiple interviewers all in the same room. These can start out with appointments set in advance and, once the blitzes become better known, can evolve into drop-in sessions. This saves an incredible amount of time for the municipality. The one downside is that you do not have the opportunity to visit the business itself and get a hands-on feel for what is happening – but these can be arranged post-survey.

Communication: The Communications Plan is an integral part of raising awareness. Aim to have ongoing presence in local media through launch events, having reporters join in on an interview, etc. Business Visitation Community Information Nights have been successful too.

Business Segmentation and Prioritization of Visits: Once the business visitation enters its second year and the municipality has some intelligence on its customers it will be more possible to prioritize business visits. The Synchronist software shown below has an analytical approach to this, but it would be beneficial for the municipality to categorize businesses so that high priority firms are identified for more ongoing follow-up.

Measuring the Success of a Business Visitation Strategy

It is critical that every Business Visitation Strategy:

Create clear performance objectives


Create community awareness for the importance of business retention as a broader strategy Keep stakeholders aware of activities Communicate the results of the business retention Share credit for successes with partners involved in the BR&E effort

The following are some measures that can be used to delineate the success of the strategy:

Turnaround time on business requests for information – Make an honest assessment of the time that it takes from the day that the business owner requests information to the day it is provided. Track over time. Also track whether 100% of the requests are followed up.

Turnaround time on business requests for assistance – Like the above situation, with consistent and speedy follow-up, this is where the business understands and appreciates that the municipality is looking out for its best interest. If follow-up is not done properly, the relationship between government and business could be worse than before. Track the time required for follow-up but also the issues that require resolution and whether these are changing over time.

Measuring the business owners’ experience – Hiring a third party to conduct a two minute “How was your experience?” survey can offer great insight into the value of the municipality as perceived before and after the interview as well as after follow-up. This is also a great way to improve individual service delivery.

How the Business Visitation Strategy adds intelligence to important municipal priorities – If used appropriately, this can be one of the greatest potential advantages of the initiative. For instance, the RMWB is in an ongoing discussion with the Province of Alberta over the need to release Crown Land for business parks. By compiling first-hand information from the business owners on their future needs, the Municipality has very valuable competitive intellenge. This can be used for workforce development initiatives, emergency services enhancements, municipal planning, etc.

Required Resources for an Ongoing Business Visitation Strategy

The required annual financial and human resources requirements will vary based on a number of factors:

the number of interviews to be completed the method by which interviews are completed (at place of business is most labour intensive, phone and ‘business

blitz’ method described above are least intensive the degree of follow-up required.

The following is an example budget based on completing 300 interviews in one year and completing 100% of the interviews in-person.


Note that during the first year there will be a learning curve and adaption period required which will vary depending on the software program that is selected (see next section). The cost for the software will also vary but will likely constitute no more that 10% of the total project budget.

FIGURE 7.9: RESOURCES REQUIRED FOR A BUSINESS VISITATION PROJECT

Task Time Required Funding Required

Appointment setting

75 hours

Average 15 minutes per appointment allowing for time returning calls and unsuccessful scheduling

75 hours of an administrator-researcher who has an understanding of the importance of the initiative.

Conducting the survey – City of Leduc

450 hours (double if wanting to have a second person participate as scribe)

300 interviews - 30 minutes travel and 1 hour visit

450 hours of one senior economic developer and potentially an additional 450 hours of one

administrator-researcher. Estimated budget for local travel: $3,000

Follow-up the survey –thank you letter, fulfilling information requests (varies considerably)

375 hours

Estimated at 1.25 hours per company

300 hours of one senior economic developer and 75 hours of one administrator-researcher

Data entry150 hours

Estimated 30 minutes per survey150 hours of one administrator-researcher

Data analysis and strategy preparation

140 hours

Estimated 4 weeks of work

80 hours of one senior economic developer and 60 hours of one researcher

Communications and Partnership Development

200 hours150 hours of one senior economic developer and 50

hours of one administrator-researcher

Cost of supplies – computer, paper, kit folders, communications materials, etc.

10 hours to prepare and reproduce materials $5,000 and 50 hours of one administrator

Business Visitation Software Tools


A variety of tools exist to track and maintain information for business visitation. We have provided a summary of five programs which could be used in the City of Leduc’s business visitation program.

FIGURE 7.10: SOFTWARE TOOLS FOR BUSINESS VISITATION PROGRAMS

Software Tool Features Takeaways

Synchronist Business Information System: a web-based system that is used specifically for business retention and expansion

- Company assessments- Customizable surveys and data analysis- Client Relationship Management, includes

client contacts, service delivery log- Opportunity management feature allows you

to track leads, start-up data- Reports such as worker recruiting problems,

industry shifts, community strengths and weaknesses, etc.

- Analysis is easy with build in tools and reports- The CRM and Opportunity managers are useful

for relationship building- Web-based, so internet connectivity is necessary

for data entry- Company assessments provide key insights to

understand the life-stage of the company and its needs

Executive Pulse Business Intelligence System: ClientCRM online software system that includes database and communication features with the aim of improving a community’s effectiveness and efficiency of business retention activity

- CRM software tracks daily visit records and can provide analysis for firms visited

- Tasks and requests can be assigned to partners, provides results-oriented metrics

- Creates user and pre-defined reports- Online, highly secure program that can be

accessed from anywhere- Customizable to meet changing needs

- Highly focused on business relationship building, through the CRM software

- Additional modules are available for areas such as workforce development

- ExcutivePulse is an online tool requiring internet connectivity

- Ability to merge contacts, email, and calendar from mainstay email packages

Maximizer ClientCRM Software provides a central hub to keep the entire history of every client prospect

- Account and contact management, with tasks and reporting

- Sales force automation and forecasting, useful in lead management, opportunity management and monitoring and relationship management

- Marketing and email campaigns

- Lack of survey tool and business retention specific analysis

- Would need a tool such as Survey Monkey to provide the survey capability

- Can be used with Blackberry Smartphones- Emphasis on customer service and support



Sage ACT! Pro 2011: created for individuals and small businesses and sales teams to organize client information. The software acts as a central hub for emails, meeting notes, task reminders and social media profiles

- Relationship management with contact management software, conversation notes, documents, social media profiles

- Advanced searches available to find information in the database

- Smart tasks enhance work productivity – they can be pre-loaded or customized

- New lead generation - obtain leads you can use with Sage Business Info Services, pulls highly targeted prospect lists and business info from Hoover’s

- Marketing campaign service, with tracking for open and click through rates

- The software is specifically designed for economic development study

- There are no survey tools for business retention specific analysis

- Can be fully integrated with other business tools.- Would need a tool such as Survey Monkey to

provide the survey capability

SalesForce.com and SalesForce CRM: SalesForce.com has been a leader in web based CRM since the mid-2000s and has developed an economic development-specific platform

- Marketing campaign management- Customer Service and Support manages client

contact to ensure timely and value added follow-up

- Document management- Content Management- Analytics of sales data

- Hiring a consultant is recommended to customize the software and train users on its use

- Requires internet access- Has a strong focus on client relationship

management, but is not a business retention tool



SurveyMonkey is an online survey tool that allows users to develop custom surveys

- Surveys can be customized with logo, and can be collected through a website or through a URL direct link to the survey

- Cost-effective- 51 survey templates, 15 types of questions.- Will provide results analysis.- Real time results

- Business visits can be keyed in on the spot if there is internet connection

- Business visit data can be keyed in after the visit by staff

- Varying ability to analyse data- Provides excellent baseline information as a first-

time Business Visitation Survey- No other functionality, not recommended for an

on-going program, but effective for project by project collection and analysis

The review of these six software programs allows the City of Leduc to take several different directions:

10. Use Synchronist on its own11. Use ExecutivePulse on its own12. Use Maximizer, ACT! or SalesForce.com with SurveyMonkey13. Use SurveyMonkey on its own14. Use no tool.

Should Leduc enter into a more formalized and ongoing Business Visitation Program, we recommend option 1 or 2 above and that you complete an internal evaluation of the Synchronist and ExecutivePulse systems. The reporting and analysis behind Synchronist seems to be more powerful and Eric Canada is one of the leading business retention experts in North America so staff would benefit from his knowledge. ExecutivePulse is now being used by many communities in Alberta and was recently purchased by the Province of British Columbia for use in its regions (Saskatchewan bought Synchronist for its REDAs) and has a flexible back office data analysis tool that you can manipulate and conduct cross-tabulations with Excel.


7.5 Structure – Characteristics of Strong ModelsThe following are characteristics of effectively run economic development models and adapted for Leduc’s specific circumstances. The City is encouraged to develop its structure in the following manner.

7.5.1 Fit into Staff Organization Report to the City Manager due to high profile of many projects with an advanced title so that business executives will

pay attention. Remember, this person will often be dealing with the most senior member of private sector businesses. A possibility is to include Agriculture/Sport Tourism position in the structure.

7.5.2 Relationship to Regional OrganizationsTo ensure a duplication of functions does not occur, there is a need for a liaison at the City to influence the regional economic development agenda. This means consistent participation with the EDA and GEEDT at a staff level and liaising with the Mayor and City Manager when it comes to dealings at the CRB table.

7.5.3 Response Teams for Investment Attraction and Investment RetentionThis is useful to keep lines of communication clear, which is sometimes a challenge with a City that has many external relationships and a large internal staff. The Response Team is an agreement that identifies who is the primary contact with respect to handling investor inquiries or any economic development project. In return, the members of the response team recognize the urgency related to providing accurate and timely data for an investment inquiry.

7.5.4 Human & Financial Resources RequirementsThe following are some guidelines in formally establishing the position:

Economic Development must be a separate line item in the budget in order to allow flexibility in reacting to projects Viewed as an investment, not an expense and have the measurements in place to show there is a return Begin with two full-time positions, a senior manager and economic development analyst/researcher


Goal for leveraged funding from senior levels in year one is $60,000 A budget of $395,000 is recommended for the first full year of operation (likely 2013). Broken down as follows:

FIGURE 7.11: SAMPLE BUDGET FOR FIRST FULL YEAR

Manager Salary $80,000

Economic Development Analyst Salary $50,000

Non-salary Benefits $30,000

Investment Attraction: Hospitality/Tourism $20,000

Investment Attraction: Downtown-related $25,000

Investment Attraction Branding & Marketing $35,000

Investment Attraction: Lone Eagles $15,000

Sectors Marketing Plan Development $45,000

Business Retention & Expansion $25,000

Infrastructure and Planning: Aerotropolis, Port Alberta $10,000

Research & Database Development $15,000

Software/Networking $10,000

Memberships/Professional Development $10,000

Travel $20,000

Office Supplies $5,000

TOTAL $395,000


7.6 Performance ManagementPerformance measurement is a tool to determine how well a job has been done using both qualitative and quantitative information and activities. The following reasons make it important to track activity and performance.

Providing public accountability Assisting with human resources management Using results to improve performance Identifying the return on investment

An effective economic development office must perform, measure and communicate these results.

Unfortunately, performance measurement in economic development is not a common practice. This is something of an unacceptable situation and is slowly changing as economic development professionals see the merits in tracking performance so they can improve their operations. To a large degree though, they are reacting to negative circumstances – only tracking because their stakeholders are forcing them. Governors of municipal dollars cannot be blamed, however, as they are being increasingly pressured by their constituents to do more with less.

Not helping the situation is the fact that no research has been done, to date, on the most effective (or ineffective) economic development performance measures. However, in an effort to provide the City with the latest in thinking on this subject, the following section provides specific details measuring customer service and return on investment as it pertains to the business of investment attraction.

7.6.1 Providing Top-Notch ServiceEconomic development is a service business and investment prospects require a high-degree of attention. To effectively determine the client’s needs and identify possible solutions takes strong selling skills and a broad knowledge of the local and regional economy, certain industrial sectors, building/land development and the local business community.

Interaction with the client may begin with a single staff person, but as the project develops it is normal for many different city departments and outside organizations to be involved. There needs to be a standard operating procedure and single point of contact, but this person must have the ability and capability of accessing information from many sources. To be consistently successful in attracting new business, the City and other organizations in the community must be recognized as one team who are working towards the common goal of doing whatever it can to attract desirable investments.


When the City becomes the key point of contact it should aim to consistently meet the “Gold Standard” of acceptable service. The following table shows how technology has accelerated the Gold Standard over the last 15 years.

FIGURE 7.12: EVOLUTION OF ECONOMIC DEVELOPMENT SERVICES

YearThe Gold Standard

Response TimeThe Gold Standard of Economic Development Service

1996-2002

48 hours

At the end of the call with the investment prospect the EDO says: “To help you better understand our community and the opportunities we have for you, I will put together a package that contains our Community Profile, Available Properties Guide and Lure Brochure. I will use Post-It Notes to highlight the pages that will be of most interest so you can quickly find the relevant information. I will courier that out to you tomorrow and you should have it in 48 hours.”

2002-2008

Same day

At the end of the call with the investment prospect the EDO says “To help you better understand our community and the opportunities we have for you, I will send you an email before the end of the day that has several attachments including key excerpts from our Community Profile as well as hyperlinks to online listings of available property that closely meets your criteria.”

2008-today

While on the phone

During the call with the investment prospect, the EDO says “Do you have access to the Internet right now?” [YES] “Great, why don’t we go online and I’ll take you through our website so that you can download the relevant files. We’ll also go through our available properties directory and look at maps, photos and details of available properties which meet the criteria you’ve described to me.”

Overnight responses are no longer good enough. Communities must become more sophisticated in gathering/organizing community data and responding immediately to specific questions.

Leduc has an opportunity to utilize the latest technology to provide top-notch client service. If the City’s competitors are, then without it, it will be that much more difficult for Leduc to be successful. If the City’s competitors are not, then Leduc has a leg up in the first 10 minutes of the selling process.


This is easy to measure, but it takes an honest self-assessment. Simply, how did we do? Did we meet the Gold Standard of Service for that client? Yes or no? If no, why not? Tracking this will provide, at the end of each quarter, the percentage of times the gold standard was met. Over the course of several quarters, an economic developer will see a trend and be able to proactively identify ways to improve.

There are other techniques that can be incorporated. The economic developer (perhaps with the City as a whole) should make an effort to get feedback from their customers. Customer Feedback Surveys are a great way to do this.

7.6.2 Return on Investment – Jobs and TaxesThe most commonly used measures to identify the success of an EDO are the numbers of jobs and taxes created. Sometimes it is the only measure that is requested or understood by stakeholders despite the fact that the objective of economic development projects is not always to create jobs and taxes.

There are merits to this measure but there are also dangers. In the past, EDOs have been accused of overstating their impact because some claim that the investment would have come to the community even without the support of the EDO. For that reason alone, the Oakville Economic Development Alliance (OEDA) provides an innovative approach that Leduc can utilize.

The OEDA created an “OEDA Factor” which evaluated, on a scale of 100, how much impact they had in attracting or maintaining an investment in Oakville. A factor of 75-100 indicates they were instrumental, 50-75% indicates a high degree of involvement, 25-50% is moderate involvement such as approval expediting and 0-25% is low involvement, such as assisting with start-up. The OEDA Factor is then multiplied by the total taxes and jobs to arrive at “OEDA Jobs” and “OEDA Taxes”. Furthermore, the OEDA went to the extent of contacting each company to ensure their factor was appropriate – in case a member of the community were to want to verify. The following table from the OEDA’s 2000 Annual Report provides an overview of this very innovative approach that Leduc can utilize.


FIGURE 7.13: MEASURING IMPACT OF EDO ON JOBS AND TAXES

It is realized that, at the end of the year, Leduc may not achieve a list with such grand totals but the philosophy is the same.

Furthermore, OEDA went to efforts to display that the municipality’s financial investment paid off in just over one year. In the following table the blue bar is the OEDA taxes (from above chart) beginning in 1999. In 2000, it is the OEDA taxes from 1999 and 2000. By the end of 2000, the level of recurring taxes from OEDA’s successes more than pays for the Town’s ~$500,000 annual investment in the organization (the yellow line). By 2002, the Town was receiving $1,025,866 in taxes (Town portion only) and their investment in OEDA was still ~$500,000. It should be noted that if a business closed or downsized, they were removed from ongoing tax calculations.


FIGURE 7.14: DIRECT RETURN ON INVESTMENT: PAYING FOR OEDA

Again, it is obvious that the impact of Leduc’s EDO is not likely to be this large in terms of absolute figures, especially initially, but it could be this large proportionate to the amount invested.


Return on Investment: Oakville Economic Development

283594

1025866

$603,438

$1,788,517

0

500000

1000000

1500000

2000000

1999 2000 2001 2002

Taxes: OEDA Portion Taxes: Project Total Town Investment: OEDA

8 ConclusionLeduc is competitive in many different respects and by continuing to participate in important regional structures while establishing an Economic Development Office, the City of Leduc will provide a service that will be appreciated by the business community, community organizations and the public at large. The recommended path charts a way for the City to effectively provide a number of services that are not currently being offered, but are in high demand. What is required now is adequate financial and human resources to let the project prosper. This will allow economic development staff to concentrate on high value-added business development services. Therefore the recommended next steps for the City of Leduc are as follows:

Meet with the LNEDA and determine the level of economic development service directed to Leduc in comparison to the City’s recommended services as presented in this Economic Development Competitiveness Review.

Formalize the City of Leduc’s 2012 budget for the LNEDA and new 2013 budget for the LNEDA based on recommended services as presented in this report.

Document service levels and formalize performance measures and a reporting structure to the City Council.


Appendix A – List of StakeholdersName and Title Business/Organization

1. Colin Dale, Manager Ken's Furniture TV & Appliance

2. Del Sveinsson, Real Estate Agent Coldwell Banker Haida Realty

3. Paul Benedetto, City Manager City of Leduc

4. Greg Krischke, Mayor City of Leduc

5. John Whaley, Mayor County of Leduc

6. Corey Labrecque, Long Range Planner II City of Leduc

7. Gail Scott, Executive Director Leduc-Nisku Economic Development Authority

8. Beverly Beckett, Chairperson Leduc Downtown Progress Association

9. Bob Gibson, Senior Manager Agrivalue Processing Business Incubator

10. Stefanie Schulz, Executive Director Leduc Regional Chamber of Commerce

11. Jim Jones, Sport and Agricultural Tourism Coordinator City of Leduc

12. Jim Simpson, Interim Chief Officer Capital Region Board

13. Dianne Trenn, Director of Operations Edmonton International Airport

14. Dana Smith, Alderman City of Leduc

15. Dominic Mishio, Alderman City of Leduc

16. Shaun Green, Economic Development Officer Town of Beaumont

17. Michelle Lavasseur, Economic Development Officer Town of Devon

18. Kenn Bur, Director of Information Support Services City of Leduc

19. Ron McCullough, Chief Administrative Officer Brazeau County

20. Marvin Molzan


21. Gord Riddell, President Global Energy Solutions Inc.

22. Peter McCart, Vice-President, Strategy Edmonton Regional Airports Authority

23. Glen Vanstone, Director, Business Innovation Edmonton Regional Airports Authority

24. Brent Croucher, Senior City Planner City of Edmonton

25. Glen Finstad, Alderman City of Leduc

26. Dave MacKenzie, Alderman City of Leduc

27. Ashley Robbins, President Chamber of Commerce

28. Robert Manning, Independent Director Canadian Western Bank

29. Larry Horncastle, Business Development Officer Leduc-Nisku Economic Development Authority

30. Kevin Keller, General Manager Community Futures Capital Region

31. Ken Fiske, Vice President of Tourism and Special Events City of Edmonton

32. Brian Boles, Director of Legislative and Corporate Services

Leduc County


Appendix B – Zoning FlexibilityDesignated Use Able to Accommodate?

Oil and Gas Related Sector

Multi-modal

Logistics

Lone Eagles

Agri-Food

Hospitality / Tourism

City of Leduc

Commercial – Central Business District

* Professional

services

Commercial – General Commercial

* Professional

services

Industrial – Light Industrial

Industrial – Medium Industrial

Industrial – Cottage Industrial

Leduc County


Designated Use Able to Accommodate?


Multi-modal

Logistics

Lone Eagles

Agri-Food


Business Park District

Highway Commercial District

Service Commercial District

Industrial District

Industrial / Agricultural Resource District

City of Spruce Grove

Commercial – City Centre *

Professional

Services

Commercial – Transitional *

Professional

Services




Multi-modal

Logistics

Lone Eagles

Agri-Food


Commercial – Vehicle Oriented *

Professional

Services

General Industrial

Business Park – Light Industrial /Commercial

Strathcona County

Arterial Commercial *

Professional

Services

Highway Commercial

Major Commercial

Service Commercial




Multi-modal

Logistics

Lone Eagles

Agri-Food


Recreation Commercial

Local Commercial

Industrial Agri-Business

Industrial Eco-Business

Heavy Industrial

Heavy Industrial Transition Overlay

Local Industrial

Medium Industrial

Light Industrial




Multi-modal

Logistics

Lone Eagles

Agri-Food


Parkland County

Highway Commercial District

Business Industrial District

* Professional

Services

Medium Industrial District

Heavy Industrial District

Rural Industrial/Commercial

City of Fort Saskatchewan

Commercial – Vehicle Oriented

* Professional

Services




Multi-modal

Logistics

Lone Eagles

Agri-Food


Commercial – Central Business District

* Professional

Services

Light Industrial

Medium Industrial

Heavy Industrial

City of Edmonton

Low Intensity Business Zone

General Business Zone

Highway Corridor Zone




Multi-modal

Logistics

Lone Eagles

Agri-Food


Commercial Office Zone

Commercial Mixed Business Zone

Industrial Business Zone

Light Industrial Zone

Medium Industrial Zone

Heavy Industrial Zone

City of St. Albert

General Commercial

* Professional

Services




Multi-modal

Logistics

Lone Eagles

Agri-Food


Corridor Commercial

* Professional

Services

Mixed Commercial

Commercial and Industrial Service

Business Park

Business Park Transition

Regional Commercial

City of Wetaskiwin

Downtown Commercial

* Professional

Services




Multi-modal

Logistics

Lone Eagles

Agri-Food


General Commercial

Highway Commercial

Light Industrial

Heavy Industrial

Airport Industrial

City of Red Deer

City Centre Commercial

* Professional

Services

City Centre West Commercial

* Professional

Services




Multi-modal

Logistics

Lone Eagles

Agri-Food


Regional Shopping Centre District

Major Arterial District Commercial

Business Service Industrial

Heavy Industrial

Light Industrial and Business Service-Residential

City of Airdrie

Central Business District

* Professional

Services

Central Business Transition

* Professional

Services




Multi-modal

Logistics

Lone Eagles

Agri-Food


Regional Commercial

* Professional

Services

Commercial Mixed Use District

* Professional

Services

Industrial Business Park One

Industrial Business Park Two

Industrial Business Park Three

Railway Industrial

Rocky View County

Highway Business




Multi-modal

Logistics

Lone Eagles

Agri-Food


General Business

Limited Business

Recreation Business

Agricultural Business

Natural Resource Industrial

Hamlet Industrial

Commercial - Village Centre

Commercial - Local Commercial

* Professional

Services




Multi-modal

Logistics

Lone Eagles

Agri-Food


Commercial - Regional Commercial

* Professional

Services

Business - Highway Frontage

Business - Business Campus

Business - Industrial Campus Business

Industrial - Industrial Activity

Industrial - Industrial Storage

Business Leisure and Recreation

Business Recreation Destination




Multi-modal

Logistics

Lone Eagles

Agri-Food


Business - Agricultural Services

Commercial – Springbank Court

Note: Commercial uses that primarily serve the local residential community were not included in the matrix.

Sources: City of Leduc Land Use Bylaw 516-2002, amended as of June 2011 www.leduc.ca/Assets/Departments/Planning+and+Development/Land+Use+Bylaw.pdf Leduc County Land Use bylay 7-08, adopted March 2009 www.leduc-county.com/images/stories/PDFs/Bylaws/LandUseBylaw/LandUseBylaw.pdf City of Spruce Grove Land Use Bylaw C-721-09, last amended Aug. 2011 www.sprucegrove.org/government/bylaws_policies/bylaws/land.htm Strathcona County Land Use Bylaw 8-2001, last amended Aug. 2011Parkland County Land Use Bylaw: Bylaw No. 20-2009 www.parklandcounty.com/Assets/Planning/Planning+Clerk/LUB+Consolidation+Apr1.pdf City of Fort Saskatchewan Land Use Bylaw C6-08, approved Apr. 2008 www.fortsask.ca/ftsk_City_Government/ftsk_Bylaws.aspx?id=9142 City of Edmonton Zoning Bylaw 12800, last amended Oct. 2011 webdocs.edmonton.ca/InfraPlan/zoningbylaw/bylaw_12800.htmCity of St. Albert Land Use Bylaw 9/2005, last amended Sept. 2011

www.stalbert.ca/uploads/files/our_government/bylaws/Landuse_bylaw/LUBConsolidationFeb22-2011/Part9CommercialIndustrial.pdfCity of Wetaskiwin Land Use Bylaw 1747-09, rewritten in 2009

www.wetaskiwin.ca/municipal/wetaskiwin/wetaskiwin-website.nsf/AllDoc/838659FD06126E9F872570E700624F48/$File/Land%20Use%20Bylaw%20-%20Revised%20August%202011.pdfCity of Red Deer Land Use Bylaw 3357/2006, last amended Sept. 2011City of Airdrie Land Use Bylaw B-09/2005, last amended Feb. 2011 www.airdrie.ca/building_development/planning/land_use.cfm#Rocky View County Land Use Bylaw C-4841-97, adopted 1998 http://www.rockyview.ca/LinkClick.aspx?fileticket=1CIVddDVUcA%3d&tabid=436


http://www.rockyview.ca/LinkClick.aspx?fileticket=1CIVddDVUcA%3D&tabid=436

http://www.airdrie.ca/building_development/planning/land_use.cfm

http://www.wetaskiwin.ca/municipal/wetaskiwin/wetaskiwin-website.nsf/AllDoc/838659FD06126E9F872570E700624F48/$File/Land%20Use%20Bylaw%20-%20Revised%20August%202011.pdf

http://www.wetaskiwin.ca/municipal/wetaskiwin/wetaskiwin-website.nsf/AllDoc/838659FD06126E9F872570E700624F48/$File/Land%20Use%20Bylaw%20-%20Revised%20August%202011.pdf

http://www.stalbert.ca/uploads/files/our_government/bylaws/Landuse_bylaw/LUBConsolidationFeb22-2011/Part9CommercialIndustrial.pdf

http://webdocs.edmonton.ca/InfraPlan/zoningbylaw/bylaw_12800.htm

http://www.fortsask.ca/ftsk_City_Government/ftsk_Bylaws.aspx?id=9142

http://www.parklandcounty.com/Assets/Planning/Planning+Clerk/LUB+Consolidation+Apr1.pdf

http://www.sprucegrove.org/government/bylaws_policies/bylaws/land.htm

http://www.leduc-county.com/images/stories/PDFs/Bylaws/LandUseBylaw/LandUseBylaw.pdf

http://www.leduc.ca/Assets/Departments/Planning+and+Development/Land+Use+Bylaw.pdf

Appendix C – Site Selection MatricesOil and Gas Related Sector – Architectural, Engineering and Related Services

Source: Austin Consulting, modified by Millier Dickinson Blais.


Labour Force Characteristics - Utilities -Population (Current Counts, Future Projections) H Electricity (Capacity, Availability, Rate, Reliability) HAge Profile H Natural Gas (Capacity, Availability, Rate) HCommuting Patterns H Water (Capacity, Availability, Rate, Connection Fees, Quality) LIncome (Average Income, Household Income) H Water Quality LEthnicity Profile L Sewer (Capacity, Availability, Rate, Connection Fees) LSize of total labour force / Participation rate H Waste Management / Hazardous Waste Carriers & Facilities LUnemployment Rate / Employment Rate M Telecommunications (High Speed Internet, Cell Phone carriers) HAvailability of Skilled Workers H Local Business Environment -

Cost of Skilled WorkersH

ED involvement in local business community ("Business Friendliness")H

Availability of Unskilled Workers L Environmental Policies LCost of Unskilled Workers L Costs for Permitting, Construction, Occupancy MCompetition for Required Skill Sets H Time Required to Process Zoning Permit, Site Plan, Building Permits MLevel of Education H Recent Level of Development Activity MTurnover / Absenteeism M Property Availability and Cost -Presence of Union (labour management relations) L Industrial Building Availability LLanguage Skills H Serviced Industrial Land Availability (shovel ready sites) LWorkers compensation and employment insurance L Commercial (Office) Building Availability HLocal Industry - Commercial (Office) Land Availability HLargest Employers (type of company and employee counts) M Cost of Land / Lease Rates HOther local employers (type of company and employee counts) M Incentives / Business Support Programs -Locally Targeted Industries M Business Financing (Long term financing, etc.) MRecent projects / Companies new to the area H Provincial and Local Incentive Programs (tax exemptions, grants, etc) HSame Industry Cluster M Provincial and Local Business Development Programs HPresence of Supplier/Support Businesses M International Resources / Government Services HExisting Research Base H Local Chambers of Commerce HPresence of military base and installations M Education & Training -Transportation / Distribution - Elementary School Performance Rankings HProximity to Current and Future Customer Markets L Secondary School Performance Rankings HProximity to Suppliers/Raw Materials L Community Colleges - Availability and Quality of Programs HProximity to Highways M Universities - Availability and Appllicable Programs HProximity to Airports M Technical/Vocational Colleges - Availability and Quality of Programs MProximity to Railways / Intermodal Facilities L Local Employment and Training Services HProximity to Port Facilities L Quality of Life -3rd Party Trucking Availability L Health Care Facilities H3rd Party Warehousing Availability L Emergency Services (Police, Fire, EMS) HTaxes - Crime Rate HLocal Property Rates H Recreation and Cultural Facilities HProvincial Tax Rates H Climate MFederal Tax Rates / Corporate Tax Rate H Housing Availability and Cost H

Perception of Attractiveness to Employees Outside of Area M

INVESTMENT FACTORS Category Weight %

Location Factor

Importance

18

10

5

8

8

9

10

10

12

10


Location Factor

Importance

Multi-Modal Logistics Sector



Category

Weight %

Location

Factor

Importance

Labour Force Characteristics - Utilities -Population (Current Counts, Future Projections) M Electricity (Capacity, Availability, Rate, Reliability) MAge Profile L Natural Gas (Capacity, Availability, Rate) MCommuting Patterns L Water (Capacity, Availability, Rate, Connection Fees, Quality) LIncome (Average Income, Household Income) M Water Quality LEthnicity Profile L Sewer (Capacity, Availability, Rate, Connection Fees) LSize of total labour force / Participation rate H Waste Management / Hazardous Waste Carriers & Facilities LUnemployment Rate / Employment Rate H Telecommunications (High Speed Internet, Cell Phone carriers) MAvailability of Skilled Workers M Local Business Environment -

Cost of Skilled WorkersM

ED involvement in local business community ("Business Friendliness")M

Availability of Unskilled Workers H Environmental Policies MCost of Unskilled Workers H Costs for Permitting, Construction, Occupancy HCompetition for Required Skill Sets M Time Required to Process Zoning Permit, Site Plan, Building Permits HLevel of Education L Recent Level of Development Activity MTurnover / Absenteeism M Property Availability and Cost -Presence of Union (labour management relations) M Industrial Building Availability HLanguage Skills L Serviced Industrial Land Availability (shovel ready sites) HWorkers compensation and employment insurance H Commercial (Office) Building Availability LLocal Industry - Commercial (Office) Land Availability LLargest Employers (type of company and employee counts) L Cost of Land / Lease Rates HOther local employers (type of company and employee counts) L Incentives / Business Support Programs -Locally Targeted Industries L Business Financing (Long term financing, etc.) MRecent projects / Companies new to the area L Provincial and Local Incentive Programs (tax exemptions, grants, etc) HSame Industry Cluster M Provincial and Local Business Development Programs LPresence of Supplier/Support Businesses H International Resources / Government Services LExisting Research Base L Local Chambers of Commerce LPresence of military base and installations L Education & Training -Transportation / Distribution - Elementary School Performance Rankings LProximity to Current and Future Customer Markets H Secondary School Performance Rankings LProximity to Suppliers/Raw Materials H Community Colleges - Availability and Quality of Programs MProximity to Highways H Universities - Availability and Appllicable Programs LProximity to Airports M Technical/Vocational Colleges - Availability and Quality of Programs MProximity to Railways / Intermodal Facilities H Local Employment and Training Services MProximity to Port Facilities M Quality of Life -3rd Party Trucking Availability H Health Care Facilities L3rd Party Warehousing Availability H Emergency Services (Police, Fire, EMS) LTaxes - Crime Rate LLocal Property Rates M Recreation and Cultural Facilities LProvincial Tax Rates M Climate LFederal Tax Rates / Corporate Tax Rate M Housing Availability and Cost L

Perception of Attractiveness to Employees Outside of Area L

7

4

INVESTMENT FACTORS INVESTMENT FACTORS

8

15

10

20

7

8

15

6

Category

Weight %

Location

Factor

Importance

Lone Eagles



Labour Force Characteristics - Utilities -Age Profile L Electricity (Capacity, Availability, Rate) LCommuting Patterns L Natural Gas (Capacity, Availability, Rate) LHousehold Income M Water (Capacity, Availability, Rate) LEthnicity Profile M Water Quality MSize of total labour force/Participation rate L Sewer (Capacity, Availability, Rate) LUnemployment Rate / Employment Rate L Waste Management/Hazardous Facilities LAvailability of Skilled Workers M Telecommunications HCost of Skilled Workers M Local Business Environment -Availability of Unskilled Workers L ED involvement in local business community LCost of Unskilled Workers L Environmental Policies MCompetition for Required Skill Sets L Costs - Permits, Construction, Occupancy LTurnover / Absenteeism L Time to Process Permits, Site Plan LLabour-Management Relations L Recent Level of Development Activity LLanguage Skills M Property Availability and Cost -Local Industry - Industrial Building Availability LLargest Employers L Serviced Industrial Land Availability LLocally Targeted Industries H Commercial Building Availability MCompanies new to the area H Commercial Land Availability MLocal Industry Cluster M Cost of Land / Lease Rates HPresence of Supplier/Support Businesses M Incentives/ Support Programs -Existing Research Base H Business Financing MTransportation / Distribution - Provincial and Local Incentive Programs LProximity to Current/Future Customers M Int’l Resources / Government Services LProximity to Suppliers/Raw Materials L Local Chambers of Commerce HProximity to Highways H Education & Training -Proximity to Airports H Elementary School Performance HProximity to Railways / Intermodal L Secondary School Performance HProximity to Port Facilities L Community Colleges - Quality H3rd Party Trucking Availability L Universities - Applicable Programs H3rd Party Warehousing Availability L Local Employment and Training Services HTaxes - Quality of Life -Local Property Rates M Health Care Facilities HProvincial Tax Rates L Emergency Services (Police, Fire, EMS) HFederal Tax Rates / Corporate Tax Rate L Crime Rate H

Recreation and Cultural Facilities HClimate MHousing Availability and Cost HPerception of Attractiveness to Incoming Employees M

Location Factor

Importance

30

Category Weight %

Location Factor

ImportanceINVESTMENT FACTORS Category

Weight %

6

14

3

8

6

11

5

12

INVESTMENT FACTORS

5

Agri-Food Processing Sector



Labour Force Characteristics - Utilities -Population (Current Counts, Future Projections) M Electricity (Capacity, Availability, Rate, Reliability) HAge Profile M Natural Gas (Capacity, Availability, Rate) MCommuting Patterns L Water (Capacity, Availability, Rate, Connection Fees, Quality) HIncome (Average Income, Household Income) H Water Quality MEthnicity Profile H Sewer (Capacity, Availability, Rate, Connection Fees) HSize of total labour force / Participation rate H Waste Management / Hazardous Waste Carriers & Facilities LUnemployment Rate / Employment Rate H Telecommunications (High Speed Internet, Cell Phone carriers) LAvailability of Skilled Workers M Local Business Environment -

Cost of Skilled WorkersM

ED involvement in local business community ("Business Friendliness")H

Availability of Unskilled Workers H Environmental Policies HCost of Unskilled Workers H Costs for Permitting, Construction, Occupancy HCompetition for Required Skill Sets M Time Required to Process Zoning Permit, Site Plan, Building Permits HLevel of Education L Recent Level of Development Activity MTurnover / Absenteeism M Property Availability and Cost -Presence of Union (labour management relations) H Industrial Building Availability MLanguage Skills M Serviced Industrial Land Availability (shovel ready sites) HWorkers compensation and employment insurance M Commercial (Office) Building Availability LLocal Industry - Commercial (Office) Land Availability LLargest Employers (type of company and employee counts) M Cost of Land / Lease Rates HOther local employers (type of company and employee counts) M Incentives / Business Support Programs -Locally Targeted Industries M Business Financing (Long term financing, etc.) MRecent projects / Companies new to the area M Provincial and Local Incentive Programs (tax exemptions, grants, etc) HSame Industry Cluster M Provincial and Local Business Development Programs MPresence of Supplier/Support Businesses H International Resources / Government Services LExisting Research Base L Local Chambers of Commerce MPresence of military base and installations L Education & Training -Transportation / Distribution - Elementary School Performance Rankings LProximity to Current and Future Customer Markets H Secondary School Performance Rankings LProximity to Suppliers/Raw Materials M Community Colleges - Availability and Quality of Programs MProximity to Highways H Universities - Availability and Appllicable Programs LProximity to Airports L Technical/Vocational Colleges - Availability and Quality of Programs MProximity to Railways / Intermodal Facilities M Local Employment and Training Services HProximity to Port Facilities L Quality of Life -3rd Party Trucking Availability H Health Care Facilities L3rd Party Warehousing Availability M Emergency Services (Police, Fire, EMS) LTaxes - Crime Rate LLocal Property Rates M Recreation and Cultural Facilities LProvincial Tax Rates M Climate LFederal Tax Rates / Corporate Tax Rate M Housing Availability and Cost M

Perception of Attractiveness to Employees Outside of Area L

4

INVESTMENT FACTORS

17

8

13

8

12

8

12

10

8

INVESTMENT FACTORSCategory Weight %

Location Factor

Importance

Category Weight %

Location Factor

Importance

Hospitality & Tourism Sector



Labour Force Characteristics - Utilities -Age Profile M Electricity (Capacity, Availability, Rate) LCommuting Patterns L Natural Gas (Capacity, Availability, Rate) LHousehold Income M Water (Capacity, Availability, Rate) MEthnicity Profile M Water Quality MSize of total labour force/Participation rate M Sewer (Capacity, Availability, Rate) MUnemployment Rate / Employment Rate H Waste Management/Hazardous Facilities LAvailability of Skilled Workers M Telecommunications HCost of Skilled Workers L Local Business Environment -Availability of Unskilled Workers M ED involvement in local business community HCost of Unskilled Workers L Environmental Policies LCompetition for Required Skill Sets H Costs - Permits, Construction, Occupancy MTurnover / Absenteeism M Time to Process Permits, Site Plan HLabour-Management Relations L Recent Level of Development Activity MLanguage Skills H Property Availability and Cost -Local Industry - Industrial Building Availability LLargest Employers L Serviced Industrial Land Availability LLocally Targeted Industries L Commercial Building Availability HCompanies new to the area L Commercial Land Availability HLocal Industry Cluster H Cost of Land / Lease Rates HPresence of Supplier/Support Businesses M Incentives/ Support Programs -Existing Research Base L Business Financing MTransportation / Distribution - Provincial and Local Incentive Programs MProximity to Current/Future Customers H Int’l Resources / Government Services LProximity to Suppliers/Raw Materials L Local Chambers of Commerce HProximity to Highways H Education & Training -Proximity to Airports H Elementary School Performance LProximity to Railways / Intermodal L Secondary School Performance LProximity to Port Facilities L Community Colleges - Quality M3rd Party Trucking Availability L Universities - Applicable Programs L3rd Party Warehousing Availability L Local Employment and Training Services HTaxes - Quality of Life -Local Property Rates M Health Care Facilities HProvincial Tax Rates L Emergency Services (Police, Fire, EMS) HFederal Tax Rates / Corporate Tax Rate L Crime Rate H

Recreation and Cultural Facilities HClimate MHousing Availability and Cost MPerception of Attractiveness to Incoming Employees L

Location Factor

ImportanceINVESTMENT FACTORS Category

Weight %

Location Factor

Importance

6

13

10


12

7

8

10

15

10

9

Appendix D – City of Leduc and Leduc County Competitiveness Comparison

Business Profile for Leduc County

Source: Statistics Canada, Business Patterns Data, 2007 and 2011.Leduc County Oil and Gas Related Sector, Number of Business Locations, 2007-2011


Total % of TotalSelf-

Employed

Businesses with

Employees Total % of TotalSelf-

Employed

Businesses with

Employees11 Agriculture, Forestry, Fishing and Hunting 167 12.7% 141 26 117 10.0% 98 19 -29.9%

21 Mining, Quarrying, and Oil and Gas Extraction 82 6.2% 23 59 79 6.8% 23 56 -3.7%

22 Utilities 4 0.3% 3 1 3 0.3% 2 1 -25.0%

23 Construction 154 11.7% 56 98 161 13.8% 69 92 4.5%

31-33 Manufacturing 148 11.2% 31 117 140 12.0% 28 112 -5.4%

41 Wholesale Trade 99 7.5% 17 82 97 8.3% 19 78 -2.0%

44-45 Retail Trade 47 3.6% 23 24 27 2.3% 8 19 -42.6%

48-49 Transportation and Warehousing 89 6.8% 44 45 53 4.5% 22 31 -40.4%

51 Information and Cultural Industries 4 0.3% 2 2 2 0.2% 0 2 -50.0%

52 Finance and Insurance 48 3.6% 39 9 45 3.9% 41 4 -6.3%

53 Real Estate and Rental and Leasing 126 9.6% 98 28 123 10.5% 99 24 -2.4%

54 Professional, Scientific and Technical Services 91 6.9% 43 48 76 6.5% 33 43 -16.5%

55 Management of Companies and Enterprises 56 4.3% 44 12 53 4.5% 41 12 -5.4%56 Administrative and Support, Waste Management and Remediation Services 32 2.4% 15 17 43 3.7% 16 27 34.4%

61 Educational Services 7 0.5% 2 5 7 0.6% 2 5 0.0%

62 Health Care and Social Assistance 8 0.6% 4 4 5 0.4% 2 3 -37.5%

71 Arts, Entertainment and Recreation 6 0.5% 4 2 6 0.5% 3 3 0.0%

72 Accommodation and Food Services 23 1.7% 2 21 16 1.4% 3 13 -30.4%

81 Other Services (except Public Administration) 124 9.4% 41 83 113 9.7% 46 67 -8.9%

91 Public Administration 2 0.2% 0 2 1 0.1% 0 1 -50.0%

Total Economy 1,317 100.0% 632 685 1,167 100.0% 555 612 -11.4%

Industry (NAICS)

December 2007 June 2011 % Change 2007 - 2011

Backward Linked Industries Forward Linked Industries

Source: Statistics Canada, Business Patterns Data, 2007 and 2011.

Leduc County Multimodal Logistics Sector, Number of Business Locations, 2007-2011


4-Digit NAICS Supplier Industries

No. Of Businesses

(2007)

No. Of Businesses

(2011)

2131 Support activities for mining and oil and gas extraction 76 75 4-Digit

NAICS Customer IndustriesNo. Of

Businesses (2007)

No. Of Businesses

(2011)

2361 Residential Building Construction 16 23 2212 Natural gas distribution 0 0

2362 Non-residential Building Construction 13 12 3241 Petroleum and coal products

manufacturing 1 12370 Heavy and Civil Engineering

Construction 33 28 2211 Electric power generation, transmission and distribution 1 1

2380 Specialty Trade Contractors 92 984861, 4862, 4869

Pipeline transportation 0 0

3329 Other Fabricated Metal Product Manufacturing 13 7 5617 Services to buildings and

dwellings 9 14

5324Commercial and Industrial Machinery and Equipment Rental and Leasing

34 26 3251 Basic chemical manufacturing 2 1

3331Agricultural, Construction and Mining Machinery Manufacturing

21 30 3274 Lime and gypsum product manufacturing 0 0

3328 Coating, engraving, heat treating and allied activities 6 7 3253

Pesticide, fertilizer and other agricultural chemical manufacturing

0 0

3339 Other General-Purpose Machinery Manufacturing 14 7 3252

Resin, synthetic rubber and artificial and synthetic fibres and filaments manufacturing

2 1

5413 Architectural, Engineering and Related Services 28 20 Total 15 18

2212 Natural Gas Distribution 0 0Total 346 333

Oil and Gas

Extraction



1 0

62

29

8

1

2

3

2

4

0

10

20

30

40

50

60

70

80

December 2007

493 Warehousing and Storage

491 + 492 Postal, Couriers and Messenger Services

488 Support Activities for Transportation

486 Pipeline Transportation

484 Truck Transportation

481 + 482 Air & Rail Transportation

75 firms 37 firms

June 2011

Leduc County, ‘No Employee Business Growth, December 2007 – June 2011



11 Agriculture, Forestry, Fishing and Hunting 141 98 -43 -30.5% Significant Decrease

21 Mining, Quarrying, and Oil and Gas Extraction 23 23 0 0.0% N/A

22 Utilities 3 2 -1 -33.3% Marginal Decrease

23 Construction 56 69 13 23.2% Strong Increase

31-33 Manufacturing 31 28 -3 -9.7% Marginal Decrease

41 Wholesale Trade 17 19 2 11.8% Marginal Increase

44-45 Retail Trade 23 8 -15 -65.2% Significant Decrease

48-49 Transportation and Warehousing 44 22 -22 -50.0% Significant Decrease

51 Information and Cultural Industries 2 0 -2 -100.0% Marginal Decrease

52 Finance and Insurance 39 41 2 5.1% Marginal Increase

53 Real Estate and Rental and Leasing 98 99 1 1.0% Marginal Increase

54 Professional, Scientific and Technical Services 43 33 -10 -23.3% Significant Decrease

55 Management of Companies and Enterprises 44 41 -3 -6.8% Marginal Decrease56 Administrative and Support, Waste Management and Remediation Services 15 16 1 6.7% Marginal Increase

61 Educational Services 2 2 0 0.0% N/A

62 Health Care and Social Assistance 4 2 -2 -50.0% Marginal Decrease

71 Arts, Entertainment and Recreation 4 3 -1 -25.0% Marginal Decrease

72 Accommodation and Food Services 2 3 1 50.0% Marginal Increase

81 Other Services (except Public Administration) 41 46 5 12.2% Strong Increase

91 Public Administration 0 0 0 0.0% N/A

Total Economy 632 555 -77 -12.2%

Growth Classification

Industry (NAICS) December 2007

June 2011 Growth % Growth

Leduc County, Agri-Food Sector, Number of Businesses, 2007-2011



157

111

9

6

2

3

2

0

3

1

0

20

40

60

80

100

120

140

160

180

200


413 Food, Beverage and Tobacco Wholesaler-Distributors

411 Farm Product Wholesaler Distributors

311 + 312 Food & Beverage Manufacturing

115 Support Activities for Farms

111 + 112 Farms

Largely an agricultural

producer sector

173 firms 121 firms

Leduc County Hospitality and tourism Sector, Number of Businesses, 2007-2011



1 15 5

6 8

178

0

20

40


722 Food Services & Drinking Places

721 Accommodation Services

713 Amusement, Gambling & Recreation Industries

712 Heritage Institutions

711 Performing Arts, Spectator Sports & Related Industries

29 firms 22 firms

Largely hospitality

driven industry for

business visitors

Regional Competitive Analysis

Characteristic City of Leduc Leduc County

Population (2010) 23,293 13,260

Population Growth (2005-2010) 49% 218%

2010 Municipal Tax Rate Comparison

Residential/Farmland - 6.18%

Non-Residential – 9.97%

Residential Farmland – 3.00%

Non-Residential – 7.14%

2010 Residential, Non-Residential and Machinery & Equipment Assessment Share Comparison

74.5% Residential

25.3% Non-Residential

0.2% Machinery & Equipment

34.4% Residential

63.3% Non-Residential

2.3% Machinery and Equipment

2009 Residential, Non-Residential and Machinery & Equipment Property Taxation Revenues

$30.6 million

64.5% Residential, 35.5% Non-Residential

$44.7 million

21.7% Residential, 76.3% Non-Residential, 2.1% Machinery & Equipment

Vacant Serviced Industrial Land Available for Sale/Lease (Net Ha)

53 56

Total Vacant Designated Industrial Lands (Net Ha)

526 890

Average Serviced Vacant Industrial Land Price ($/acre)

$402,000 $328,000

Permitted Use Flexibility to Accommodate Business Growth in Specific Sectors

Refer to Appendix B


Industry-Specific Competitive Benchmarking


City of Leduc Leduc County


Pop. 23,293 (2010)

Pop. 33,077 (2041)


- Majority work outside of Leduc

- Median Household income (2005) = $66,963

- Nearly 2,000 residents studied architecture, engineering and related

technologies.

Pop. 13,260 (2010)

Pop. 21,852 (2041)


- Majority work outside of Leduc County

- Median Household income (2005) = $66,036

- Over 1,600 residents studied architecture, engineering and related

technologies.

Similarities in Regional Labour Force Characteristics: These communities are part of the Edmonton regional labour force of 719,400, participation

rate of 74.4 and unemployment rate of 5.3 (2011.) Across the Edmonton Region the average wage for a civil engineering technologist is $28.72/hr. The

labour supply and demand for this occupation is expected to be balanced. The Edmonton Region is dominated by people with a high school or college

diploma with the workforce having primarily English language skills.



- All major regional colleges or universities are located in the City of Edmonton.

30 Source: Alberta Ministry of Municipal Affairs, Municipal Profiles, Statistics Canada, Census Profiles, Labour Force Information September 11 to 17, 2011, catalogue no. 71-001-X, http://www.statcan.gc.ca/pub/71-001-x/71-001-x2011009-eng.pdf; City of Red Deer Population Projections, http://www.reddeer.ca/City+Government/City+Services+and+Departments/Legislative+and+Administrative+Services/Census/Population+Projections/Population+Projections.htm; Working in Canada website, last modified on June 29th, 2011, http://www.workingincanada.gc.ca/report-eng.do?action=search_occupation; Municipal websites.



Quality of Life31

- Leduc Community Hospital, CBI Health Centre - Leduc

- New Recreation Centre

- Average house value = $228,807, over 6,500 private dwellings (2006)

- Several arenas and an equestrian centre

- Average house value = $359,271, over 4,500 private dwellings (2006)


-Total vacant serviced industrial land for sale or lease in 2009 = 53 net ha.

- Total vacant designated industrial lands in 2010 = 526 net ha.

-Average industrial land price ($/acre) in 2009 = $402,000.

- Current example of asking price ($/acre) for serviced industrial land

=$400,000.





=$398,000.

31 Source: Alberta Health Services; Facilities in the Edmonton area, http://www.albertahealthservices.ca/facilities.asp?pid=fgeo&geo=14,

32 Industrial Land Pricing Data has been derived from a variety of sources. Average Serviced Vacant Industrial Land Price Data: Bourgeois and Company Ltd., 2009; Total Vacant Designated Industrial Lands Data 2010: Watson & Associates Economists Ltd.; Vacant Serviced Industrial Land Available for Sale/Lease 2009: Bourgeois And Company Ltd; Current Industrial Land Asking Prices: Royal Park Realty Property Listings, Cushman & Wakefield Edmonton Property Listings, Avison Young Commercial Listings, Trans America Group Listings; Red Deer Industrial Market Report 2011: Soderquist Appraisals Ltd; Red Deer Queens Business Park Industrial Land Pricing: The City of Red Deer, Land and Economic Development 2011.


Multimodal Logistics Sector


Transportation / Distribution33

-Immediate access to over 1 million people and growing to 1.5 million

people by 2028.

-Highway 2 access.

- Proximity to CP Rail intermodal facility in Leduc County.

- Proximity to Edmonton International Airport.

- 88 trucking firms and four warehousing firms.

-Access to the same market as Leduc.

- Highway 2 access.

- CPR intermodal rail facilities in Nisku Business Park.

- Location of Port Alberta

- Edmonton International Airport.

- 35 trucking firms and four warehousing firms.


Similarities in Regional Labour Force Characteristics: These communities are part of the Edmonton regional labour force of 719,400, participation

rate of 74.4 and unemployment rate of 5.3 (2011). Across the Edmonton Region the average wage of a Shipper/ Receiver is $16.77/hr. The labour

supply and demand for this occupation is expected to be fair.






=$400,000.





=$398,000.

33 Source: Capital Region Population & Employment Projections Report, Appendix 1, March 2009, Growing Forward The Capital Region Growth Plan, Statistics Canada, Business Patterns data, June 2011, Working in Canada website, last modified on June 29th, 2011, http://www.workingincanada.gc.ca/report-eng.do?action=search_occupation




Lone Eagles


Quality of Life36

- Leduc Community Hospital, CBI Health Centre.

- Leduc New Recreation Centre.

- Functional Downtown with surrounding residential.

- Average house value = $228,807, over 6,500 private dwellings.

- Median Income Household = $66,963.

- Several arenas and an equestrian centre.






- All major regional colleges or universities are located in the City of Edmonton. However, some communities do have a college or university presence

as described below.


-Edmonton Region localities each have immediate access to over 1 million people and growing to 1.5 million people by 2028.

-Highway 2 access.


- Highway 2 access.



Utilities37


37 All gas utilities rates are in reference to ‘small commercial’ or ‘commercial uses’. All electricity and gas rates are current as of October 2011; Capital Region Southwest Water Services Commission. 2010 Annual Report; City of Edmonton 2010. The Way We Green: Inventory of Ideas; Gas Utilities Rates. Monthly Filing. Direct Energy and AltaGas. http://www.auc.ab.ca/utility-sector/rates-and-tariffs/Documents/Natural%20Gas/Monthly/AUC%20Monthly%20Gas%20Cost%20Schedule%20-%20Web%20posting%20October%202011.pdf






-AltaGas Utilities: $3.450/day/GJ. -AltaGas Utilities: $3.450/day/GJ.

Telecommunications38

-Broadband Internet access with up to 100 Mbps download speeds and up to 5 Mbps upload speeds.

-Network will be upgraded by August 2011 to allow for 250 Mbps download speeds and up to 15 Mbps upload speeds.

38 A market survey was conducted for the Capital Region. Data was collected from Shaw Communications on November 1, 2011.


Agri-Food Sector



- Part of the Edmonton regional labour force of 719,400, participation rate of 74.4 and unemployment rate of 5.3 (2011).

- Average Wages for Agricultural and Related Service Contractors and Managers $22.72/hr.


-Highway 2 access.


-Highway 2 access.




Utilities40


-The Regional water source is the North Saskatchewan River.



-AltaGas Utilities: $3.450/day/GJ. -AltaGas Utilities: $3.450/day/GJ.


-Total vacant serviced industrial land for sale or lease in 2009 = 53 net ha. -Total vacant serviced industrial land for sale or lease in 2009 = 56 net ha.


40 All gas utilities rates are in reference to ‘small commercial’ or ‘commercial uses’. All Rates are current as of October 2011.







=$400,000.



- Current example of asking price ($/acre) for serviced industrial land =

$398,000.


Hospitality/Tourism Sector



-Immediate access to over 1 million people and growing to 1.5 million

people by 2028.

-Highway 2 access.


-Immediate access to over 1 million people and growing.

- Highway 2 access.




Quality of Life42

- Leduc Community Hospital, CBI Health Centre.

- Leduc New Recreation Centre.

- Functional Downtown with surrounding residential.



- Several arenas and an equestrian centre.




