Big metros may get all the glory but Colliers International is touting the business benefits of mid-sized anchor cities in a new report. The commercial real estate company argues in “Cities of Opportunity” that established cities with smaller populations are more nimble and have a lot of perks not found in their bigger neighbours.
“With rising costs and infrastructure strains – such as long commute times – associated with locating in large cities such as Toronto, firms have an opportunity to locate in a medium-sized anchor city,” the report said.
Mid-sized cities are defined as having a population between 100,000 and 999,999 people.
Colliers singled out Hamilton, Ontario and Milwaukee, Wisconsin as attractive alternatives to Toronto and Chicago. Companies on the move might do well to consider these cities due to five key attributes: low costs, highly skilled labour, redevelopment opportunities, commute times and amenities.
As far as real estate goes, the report noted that the commercial property tax per square feet in Hamilton is about 70 cents to a dollar less than GTA communities like Oakville, Mississauga, Burlington and Brampton. Plus housing costs are substantially lower in Hamilton where the median value of a home is about $269,000, compared to Toronto at $439,000. Hamilton is still more affordable than Toronto’s surrounding suburbs of Mississauga and Oakville, which have median prices of $438,000 and $554,000, respectively.
Sydney Hamber, Senior Vice President and Broker at Collers International in Burlington, noted that a significant amount of Hamilton house hunters are coming from Toronto due to affordability issues. Extended GO Train service between the two cities is expected to increase the flow of home-buying Torontonians into the city.
Hamilton has also seen a number of new redevelopment projects take place as their economy diversifies. No longer just a steel town, the city has seen increases in smaller industrial operations along with a boom in healthcare and education.
The report noted that over the past four years, the annual construction value of the building permits issued within Hamilton has been more than $1 billion.
“We probably have more interest now from developers outside the city then the developers inside of Hamilton, which is very positive,” said Hamber.
On the labour front, there are three universities and 12 colleges located within the Hamilton metropolitan area, providing local businesses with an educated workforce.
The report made the case that a large amount of today’s talented workforce wants to live, work, and play within the same neighbourhoods and Hamilton can offer that lifestyle.
Commute times in Hamilton average about 20 minutes and a third of residents live within five kilometres of their workplace. As far as amenities go, the mid-sized city features an established downtown, something suburban municipalities often lack. Hamber also noted Hamilton’s reputation as the “City of waterfalls,” with easy access to the green spaces of the Niagara Escarpment.
“A lot of people know Hamilton as the city you looked at as you drove over the Skyway Bridge and all you saw was the smokestacks. A lot of those industries are gone and what’s coming in is health care, agricultural industries and a lot of research work. It’s taking us to a whole different level,” said Hamber.