The City of Calgary is actively working with key downtown partners to transform its urban landscape by converting vacant office space into much-needed homes, educational facilities, hotels, and other uses that contribute to the revitalization of the city’s core. In an effort to tackle the significant office vacancy rates, Calgary is co-investing in projects aimed at diversifying its downtown area, as part of its Downtown Office Conversion program.
One of the most notable aspects of this initiative is the focus on converting empty office buildings into residential spaces. By providing more housing options, Calgary hopes to bring more residents into the heart of the city, creating a lively and thriving community. Additionally, the conversion of office spaces into post-secondary academic institutions is set to bring more students downtown, fostering a dynamic atmosphere and increasing foot traffic in the area.
The city is also encouraging the demolition of outdated, end-of-life office buildings that no longer serve a functional purpose, further opening up opportunities for redevelopment and modernization of the downtown area.
The city’s ambitious goal is to remove 6 million square feet of vacant office space by 2031. Revitalizing Calgary’s downtown is a collaborative effort involving substantial investment from both the public and private sectors. So far, the city has secured an estimated $567 million in partner investments. The City of Calgary indicates that for every $1 it invests in these programs, it leverages $3 in private investment.
As of 2024, Calgary has 11 office conversion projects in the pipeline, with the potential to create over 1,400 new residential units in the downtown core. In total, these projects could convert up to 1.57 million square feet of vacant office space, a significant step toward the city’s goal of reshaping the downtown area into a more livable and dynamic neighbourhood.
Incentive Programs
Calgary’s Downtown Revitalization Initiative includes four financial incentive programs to transform the downtown area.
Downtown Post-Secondary Institution Incentive Program
This program encourages post-secondary institutions to establish a lasting presence in downtown Calgary by converting vacant office spaces into academic or research facilities. The program offers a $50 per square foot grant to property owners for converting office spaces, capped at $15 million per property. Collaboration between property owners, post-secondary institutions, the City of Calgary, and the Government of Alberta is essential, with a minimum 20-year lease requirement for the converted spaces.
Priority is given to projects located in the core of the Greater Downtown Plan Area. The program not only contributes to economic vibrancy but also brings thousands of students and faculty members downtown, adding to the local population and business activity.
Downtown Office Demolition Incentive Program
Some older office buildings are deemed unsuitable for conversion; this program focuses on incentivizing their removal. The Downtown Office Demolition Incentive Program provides grants covering up to 50% of demolition costs, with a rate of up to $15 per square foot based on the original gross floor area. An additional $5 per square foot is available for projects involving asbestos abatement or hazardous material removal, with a maximum grant of $3 million per property.
The goal is to reduce vacant office space, enhance safety, and open up opportunities for new developments. Buildings at the end of their lifecycle, particularly those close to land value, are given preference. This program also supports the creation of public amenity spaces and helps boost the downtown’s vibrancy and property values.
Downtown Calgary Development Incentive Program
This program targets the conversion of underutilized office space into residential units, hotels, schools, or performing arts centers. The program was reopened for new applications until October 31, 2024. It encourages property owners to capitalize on the growing demand for diverse downtown spaces.
Plus 15 Fund Offset Program
Designed to incentivize new residential development within the boundary of the Plus 15 network, this program reimburses developers up to $1 million per project to offset contributions to the Plus 15 Fund. The program aims to boost downtown’s population by making residential developments more feasible, thus driving economic growth and adding vibrancy to the area.
By encouraging housing projects, the Plus 15 Fund Offset Program aims to create more foot traffic downtown, improve safety, and support local businesses. It also plays a crucial role in enhancing Calgary’s downtown experience, contributing to long-term property value growth and supporting community resilience.