'A great idea': How office conversions could resurrect Calgary's ailing downtown

Matthew Scace · The Canadian Press

· Posted: Mar 30, 2025 5:12 PM EDT | Last Updated: 9 minutes ago

Four years ago, Maxim Olshevsky abandoned his concern for a caller opportunity.

After years of observing an exodus of downtown workers, Calgary announced it would beryllium offering handsome payouts to developers to crook abandoned bureau towers into apartments.

"We wholly pivoted successful 2021," said Olshevsky, proprietor of Peoplefirst Developments. Until then, his institution specialized successful revamping rundown buildings into mixed-used developments.

"It was a truly bully prime for our company."

The metropolis and developers are present declaring the programme a victory.

The city's website says 11 developments person been approved, but lone 2 person crossed the decorativeness enactment to date. Six much are to beryllium completed this year.

Should each the projects successfully conclude, with much nether review, the metropolis would person paid much than $200 cardinal to assistance developers get done the burdensome and costly process of retrofitting offices into surviving spaces.

"It's gone mode beyond what we really thought would happen," said Thom Mahler, the city's manager of downtown strategy.

There is statement implicit whether conversions volition cure Calgary's ailing downtown, considered 1 of Canada's astir vacant cores. The vigor hub was devastated by plunging lipid prices successful the mid-2010s and again by the COVID-19 pandemic. It has struggled to recover.

About 30 per cent of Calgary bureau abstraction sits vacant, says commercialized existent property institution CBRE. At its worst, much than a 3rd of downtown bureau abstraction was unused. While helpful, CBRE says a palmy bureau conversion programme won't lick the problem.

It says successful a caller study that vacancies successful downtown Calgary would lone beryllium a percent constituent higher if the programme didn't exist. Greg Kwong, CBRE's enforcement seat for Alberta, says it's excessively aboriginal to justice the project.

"If you gauge ... the occurrence of the programme today, no, it hasn't been good. But it's inactive ongoing," said Kwong.

"It's inactive a large idea."

Projects person faced higher worldly costs successful caller years, and expected tariffs connected Canadian goods entering the U.S. would apt further thrust up costs. Kwong has said Calgary's offering of $75 per quadrate ft would request to treble to conscionable developers' needs.

Olshevsky said helium has managed economical uncertainty with a elemental solution: decorativeness fast.

"Once we got a groove connected things, that became a small easier," helium said of his company's archetypal conversion, completed past year. He expects its 2nd to decorativeness successful aboriginal fall.

Some developers haven't been truthful lucky. The radical revamping the astir 75-year-old Barron Building, 1 of the archetypal towers that housed Calgary's lipid manufacture successful the 1950s, person seen costs treble arsenic they discovered large structural issues.

More broadly, bureau abstraction successful downtown hasn't rebounded with the vigor sector.

Recent merger and acquisition enactment has partially hampered occupancy, the CBRE study says. New entrants person been few, and it comes arsenic the city's biggest tenants right-size offices to conscionable their needs.

"There was precise beardown momentum for radical getting backmost to enactment successful the office, but momentum has slowed down a spot ... [it's] too aboriginal to archer if it's a inclination oregon conscionable a insignificant blip," CBRE's Kwong said.

Proponents of conversions similar to presumption the effort much holistically.

Mary Rowe calls Calgary a "prophetic city," due to the fact that its downturn successful the halfway started years earlier the pandemic. That forced it to find solutions earlier different cities were dealt a akin hand, said the president and CEO of the Canadian Urban Institute.

"It doesn't astonishment maine that it's taken longer, due to the fact that not each gathering is casual — nary of it is easy," she said. "We request a permissive situation truthful that you tin effort immoderate stuff, and that's what Calgary has been doing."

Other fiscal hubs, specified arsenic Lower Manhattan successful New York, person been forced to instrumentality a akin attack to gluts of bare offices. Officials determination turned to conversions aft a recession successful the aboriginal 1990s that gutted firm spaces astir Wall Street.

"Whenever Wall Street caught a cold, Lower Manhattan got pneumonia," said Andrew Breslau from the Alliance for Downtown New York.

The metropolis past brought guardant authorities making it easier for developers to person offices into residential spaces. That effort accelerated aft the Sept. 11, 2001 violent attacks wiped retired swaths of bureau space.

Over the past 30 years, Lower Manhattan's residential colonisation has grown to 70,000 from 14,000, Breslau said. The occurrence of conversions implicit that clip has been "an municipality planner's dream," helium added, with families and strollers present communal among the expanse of suits and ties.

Conversions lone instrumentality a tiny fraction of bare abstraction disconnected the market, but they kick-start caller activity, said some Breslau and Rowe.

"How bash you enactment a terms connected a park? A parkland has 1 carnal price, but erstwhile you look astatine the benefits, they're overmuch much wide than that," Rowe said. "And I would accidental the aforesaid is existent for conversions."

Increased spot values — and higher revenues for metropolis coffers — travel with redevelopments. Had Calgary done nothing, Mahler said, its downtown would proceed to languish.

"You would not spot radical wanting to unrecorded downtown. It would enactment a antagonistic temper successful the concern environment."

Calgary's programme besides offers carrots for demolishing aged buildings and for higher acquisition institutions consenting to person bare bureau space.

While nary schools person taken up the metropolis connected its offer, Mahler said an announcement with astatine slightest 1 post-secondary instauration is coming this spring.