Calgary ‘experiment’ looks to transform vacant office tower into affordable housing

With more than five million Canadians still working from home, offices across the country have become dark and lonely places. In Calgary, the COVID-19 pandemic has made a serious downtown office vacancy problem worse.

“It’s unbelievably bad. I feel like I’ve said over the last number of years, it’s unbelievably bad,” said Calgary Mayor Naheed Nenshi.

According to a recent report by real estate company Avison Young, Calgary’s downtown office vacancy rate hit a record high of 26.9 per cent in the last quarter of 2020. The company projects that the rate will soon rise to more than 30 per cent.

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“With the combined impacts of the local economic downturn and COVID-19, the amount of space given back to the leasing market in 2020 was higher than anticipated.  It now appears that Calgary’s downtown will cross into unseen territory for a modern, major office market in Canada within the next 12-24 months,” the Avison Young Calgary Office Market Report / Fourth Quarter 2020 says.

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The report notes 16 office buildings in the city are completely vacant, including Sierra Place, a 10-storey office tower once the headquarters of Dome Petroleum.

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“This building has been vacant for two years, sitting in the heart of downtown, completely vacant,” said Bernadette Majdell, CEO of Homespace Society, a Calgary non-profit that develops, rents and manages affordable housing units.

With support from the City of Calgary, Homespace Society and Inn from the Cold, a charity that provides shelter and support housing to vulnerable families, has joined forces to convert Sierra Place into an 82-unit affordable housing complex. The $28.5-million overhaul is the first of its kind in Alberta.

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“This is a unique opportunity, I think, from lots of perspectives. We are essentially reusing and recycling without having to build new,” said Heather Morley, executive director for Inn from the Cold. “More than half the families that we serve are Indigenous and a lot of families have experienced trauma, so we’re going to have a purpose-built space here that will be trauma-informed.”

Calgary city council is hoping the conversion is the first of many more to come. In addition to the $5.5 million in support it’s promised this project, the city is also establishing a $45-million fund it hopes will entice developers to remake other vacant officer towers as well.

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“We’ve had one purely private-sector conversion, this is our first attempt at an affordable housing conversion,” Nenshi said. “It is a bit of an experiment to see how well it goes but certainly there are buildings in downtown Calgary with good bones.”

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