Ground Rules: Rethinking How Edmonton Protects Industrial Land

Major industrial investors know where conditions are right – but does the City? Amidst a worrying lack of industrial investment into Edmonton, the City’s response has been to guard the stock of older, built-out industrial land. Now instead of drawing investors in, small businesses and community uses are being shut out. 

Written by Megan Magill

A strong industrial tax base is paramount to a fiscally healthy city. Few would disagree.

This mandate underpins Edmonton’s Industrial Investment Action Plan (IIAP), which reflects the City’s pressing need to staunch the bleed of industrial investment outside of the City’s borders. With a growing non-residential tax rate that is now 230% of the average rate of surrounding municipalities, the City is searching for ways to make industrial development within city boundaries more appealing to investors and developers1. The IIAP has been the main arm for the City’s approach to industrial preservation and expansion. Its nine key actions focus on attracting investment and prioritizing the development of ‘shovel-ready’ industrial land.

How Edmonton Regulates Industrial Land

Most industrial properties in Edmonton are zoned Business Employment, Medium Industrial, or Heavy Industrial. The Business Employment Zone permits light industrial uses alongside a broad range of commercial uses and is often located at the edges of industrial neighbourhoods where it functions as a buffer between industrial activity and adjacent residential or commercial areas. Medium and Heavy Industrial Zones are, by contrast, generally located in the interior of industrial areas and are meant to accommodate a variety of more intensive industrial activities. 

Following the IIAP’s directive to preserve the existing stock of medium and heavy industrial land for future development, Edmonton's city-wide District Policy was updated in 2025 to discourage the conversion of medium and heavy industrial sites to lighter non-residential zones, subject to limited exceptions. In theory, preserving the stock of industrial‑zoned land should maintain opportunities for medium and heavy industrial investment. Whether this assumption holds in practice, however, is far less clear.

While intentions of the IIAP are commendable, it has also created new challenges for landowners and tenants who own, operate, or occupy properties in older developed industrial areas.

When A Building Outlives Its Zoning

Consider an all-too-common scenario: a local, small scale investor owns a two-storey industrial building zoned Medium Industrial. Constructed in the 1960s, it was designed for a mix of office, service, and light industrial uses rather than intensive industrial operations. As the City has narrowed the Medium Industrial Zone to prioritize more intensive activity, a disconnect has emerged between the building's form and the uses the zone now contemplates. The site is already fully developed, and too small to attract the large, flexible footprint modern industrial operators want—but it is constrained from rezoning to a lighter zone because it sits in the interior of an industrial area rather than at its edge. Now, it has become an underutilized building that falls between zoning categories, half its units vacant, even as industrial investors focus on sites better aligned with their needs.

*Both buildings pictured are zoned IM.

Across the city, this scenario has been the reality for many prospective light industrial or Business Employment type uses and the businesses who rely on them. The City has taken a hard stance on preserving industrial land, while also broadly encompassing multiple conflicting land uses under Medium and Heavy Industrial Zones. Consider the below picture: A warehouse, vehicle storage yard, and three buildings on the southern portion of the parcel that employ no apparent industrial activities. All of these are zoned Medium Industrial.  

While the warehouse and yard should be preserved under the IIAP, the other buildings are only hindered by their zoning as uses compatible with their built context are limited. Beyond the zone categories themselves, neither the IIAP nor District Policy distinguishes between levels of actual industrial activity on the ground. The narrow focus on ‘preserving’ all industrial land, with little consideration for what is already present on these lands, has had a stifling effect on adaptive reuse projects in industrial areas. Unique, creative projects that are intended to reinject life and business into industrial areas are struggling to find policy support because they take away space for industrial uses. The cost of this is not borne by owners alone. Even where comparable commercially zoned land is available, it often carries a price that makes creative community uses out of reach for small businesses.

Older industrial land works for uses like community services and not-for-profits, small businesses, and recreational facilities precisely because it is more affordable. These uses often rely on tired Class C properties in need of reinvestment, and without these, they are now left with nowhere comparable to go.  

What has come of this? Instead of seeing real progress in industrial investment these rigid policies have only served to stymie development opportunities for local landowners.

A Case In Point

Nowhere are these issues made clearer than when an owner tries to resolve the zoning mismatch through the planning system.

This is based on a real, recent situation. We've changed the location and other identifying details to keep the people involved anonymous.

In one of Edmonton's older industrial areas, an owner explored rezoning options to convert a 1970s industrial building, vacant for three years, to an indoor recreation use. City Administration heavily discouraged it. Its IIAP "site selector" tool had marked the parcel as highly amenable to several industrial sectors, from logistics to warehousing to distribution, and on that basis Administration concluded the site did not qualify for conversion: it remained compatible with its industrial surroundings and still practical for medium industrial use.¹ (ADD SUPERSCRIPT footnote - The criteria for converting medium and heavy industrial land are set out in District Policy 2.5.3.4, amended by Charter Bylaw 21164.)

Administration recommended the owner look instead at other land nearby, already zoned for the use. But that land is not the owner's property, it is not for sale, and land that is properly zoned for these uses typically comes at a premium the projects in question cannot carry. The affordability of older industrial space is often the only reason these uses pencil out at all. These uses belong in Edmonton, the City says, just not on the site this person owns and sees real viability in.

The policy's tests for whether a site remains viable for industry are vague, so the City leans on the site selector to anchor what is meant to be a discretionary, site-specific judgment. But the result the City reported was a rating of how amenable the location is to industrial sectors, and that is a different thing from what the decision required. Whether the building already standing on the lot can practically convert to an industrial use, or whether the parcel is the size and shape an investor would want for new development, are separate questions, and a locational rating does not, on its face, answer them. The owner is left arguing against a score that speaks to where the site sits, while the decision turned on what is actually built on it.

The City needs to re-examine how the IIAP is being implemented. The first question it should ask is where industrial investment is actually happening.

The recent sale of the 100-acre Twin Willows Golf Course to Panattoni Development is a useful illustration of the kind of investment the IIAP is built to attract. The site, planned for future industrial use though not yet rezoned, is slated for up to two million square feet of industrial space, with build-to-suit development and construction beginning as early as 2027. In an interview with the Real Estate News Exchange, Panattoni's vice-president of development, Mark Edwards, points to the site's frontage on two major arterials, its location within about a kilometre and a half of the Anthony Henday, its straight-line connection to the Yellowhead Trail, its bus access, and a large reachable labour pool. As Edwards put it, the site checks all of the boxes occupiers are looking to check.

And Twin Willows is not an isolated case. By the City's own account, Edmonton has more than 6,500 hectares of available industrial land and 9.95 million square feet of available industrial space, as of 2023, which the City markets as abundant and development-ready.²INCLUDE FOOTNOTE https://www.edmonton.ca/business_economy/industrial-growth The City is also directly involved in bringing industrial land to market, through developments such as Goodridge Corners and Ellerslie Industrial. Whatever the precise makeup of that supply, it is difficult to reconcile a stated abundance of development-ready industrial land with a preservation policy premised on protecting industrial land from being lost.

Twin Willows is the scale of investment the City should be trying to recapture from neighbouring municipalities, and it depends on things many industrial parcels simply cannot offer: the size, the highway access, the room to build something purpose-built for a modern operator. A two-acre lot with a 1970s building on it was never going to land a project like this, whatever its zoning. Protecting it won't change that; it just keeps the site underused while the uses that could fill it are turned away.

New major investment was always going to areas like Twin Willows or Ellerslie Industrial, not to a small built-out lot in the interior of an industrial area. Both might score well for industrial suitability, but a score like that only tells you what a location could suit in theory. It can't tell you whether real investment was ever going to land there. That gap is what keeps these sites protected, and their owners stuck.

None of this is to say the City's caution is misplaced. Each conversion makes the next harder to refuse, and the City is right not to erode the industrial base by default. But that caution carries the most weight on sites that could realistically draw major industrial investment. On the ones that can't, preservation doesn't deliver a future industrial user. It just holds a building empty while the use that would fill it is turned away.

A Better Way to Apply The Policy

Recapturing industrial investment that is being lost to neighbouring municipalities should be a priority for the City. However, it should not come at the expense of the local owners and businesses caught in the gap between a building's form and the uses its zoning now contemplates.

The criteria to resolve this already exist in District Policy exemptions (Section 2.5.3.4). What is missing is a consistent, transparent basis for applying these tests. In practice, that means asking a sharper question than the score does: given the building already on the site, its size, its access, and what industrial developers are actually looking for, is major industrial development on this land realistic at all? The suitability score should inform that judgment, not stand in for it. On the evidence of how these decisions are being made, that question does not yet appear to be the one being asked. Applicants should not have to make the case against a score that speaks to location, not to what is physically on the land.

Adaptive reuse of industrial spaces is not a threat to industrial supply. Uses like markets, religious assemblies, and indoor sports do not displace new industrial development— they put underused space back to work on exactly the kind of small, built-out interior sites where medium or heavy industrial redevelopment is least likely to happen. Treating those uses as a loss of industrial land, rather than the practical outcome they are, keeps these sites in limbo.

Again, a strong industrial tax base is key to a fiscally healthy city. But in the pursuit of this mandate, the City has forgotten that local property owners trying to make use of what they have are not roadblocks against the City’s goals – they are in themselves vital to a healthy city.

1 IIAP page 6

2 Policy 2.5.3.4, amended by Charter Bylaw 21164

All photos retrieved from Google Earth (2025)