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Calgary seeks to turn empty offices in homes

June 22, 2021

A $45 million City of Calgary plan to convert empty office space into residential units is plausible, according to global architectural design firm Gensler. This conversion would mean changing the use of six million square feet of offices in Calgary’s core.
Calgary has the highest office vacancy rate in Canada—31 per cent—with approximately 12 million square feet of empty space, according to industry surveys.
Announced in April 2021, the city has approved a revitalization plan for the downtown that includes an initial investment of $200 million, with $45 million in incentives towards converting office space to residential “redevelopment or adaptive reuse.”
Gensler was contracted by the city to research the feasibility of office conversion. After studying 28 Calgary office buildings with a total of 3.2 million square feet of space, Gensler concluded half of the buildings were viable candidates for conversion.
“Our research is unequivocal. To help address the hollowing out of Calgary’s downtown core, at least six million square feet of vacant office space must be removed from the mix,” said Steven Paynter, principal at Gensler’s Toronto office.
To start, Gensler identified more than two million square feet of office space that could be “easily converted” to other uses, primarily residential.
Calgary’s conversion incentives are limited to $10 million per project.
In 2019, Calgary-based Strategic Group converted an aging seven-storey office building, at a cost of $25 million, into 65 one- and two-bedroom apartments in the west end of Calgary’s downtown.
Strategic Group is also renovating the historic downtown Calgary Barron Building—vacant for over 10 years—into 107 residential units.

But there is no guarantee the conversions will lead to instant residential success for developers. The Calgary Real Estate Board warns of an oversupply of condominiums in the city. More than 2,500 new rental apartments were recently completed or under construction in downtown Calgary, representing about a five-year supply. As well, Calgary’s downtown rental vacancy rate is 8.8 per cent, compared to a 6.3 per cent citywide average, according to Canada Mortgage and Housing Corp.



 


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