The heart of Calgary was its vibrant downtown core, home to thousands of offices, primarily of companies working the energy sector, where hundreds of thousands of people worked every day..Those companies used to pay some of the highest commercial taxes in the country, helping to keep residential property taxes relatively low..Some restaurants in the core used to see 1,000 people or more come in for lunch. Cocktail hour downtown used to be legendary, fueled by expense accounts..The operative words are ‘used to.’.The heart of the city began beating irregularly in 2014, when the price of a barrel of oil plummeted and was further exacerbated by the onslaught of the pandemic..Companies fled the core. Thousands upon thousands of people lost their jobs or worked from home. The vacancy rate of the high-rise office towers went from almost zero to as high as 32%. Earlier this year the rate edged down to close to 29%..The lights were turned off. At least five of the towers are completely empty. And residential property taxes have gone through the roof..A plan was needed to revitalize the core, a chore that fell into the bizarre bureaucratic arena known as city hall..The plan is called the Downtown Calgary Development Incentive Program, designed to spread $200 million across the core to bring it back to life..A good portion of that money — $45 million — has been set aside for building owners who agree to convert their offices into apartments. Developers will receive a grant of $75 per square foot that they convert, up to a maximum of $10 million per project..The city has announced three projects have been accepted under the plan, to convert three buildings — Palliser One (125 9 Ave. S.E.), HAT@Arts Common (205 9 Ave. S.E.) and a building that has sat empty for 10 years at 909 5 Ave. S.W.. thumbnail_palliserPalliser One (125 9 Avenue SE) . thumbnail_500_hatHAT@Arts Common (205 9 Avenue SE) . thumbnail_500_909909 5 Avenue SW .“These three projects will infuse life into largely empty or underutilized office buildings by converting empty office space to new residential units,” said the city in a release. “It’s one way we’re moving beyond the traditional 9-to-5 business district towards a vibrant city centre people enjoy 24/7, with a balanced mix of residential, office, retail, entertainment, tourism and culture.”.“The projects have been approved to receive, upon completion of construction, approximately $31 million and are expected to remove approximately 414,000 sq. ft of office space from the market and create an estimated 401 homes.”.According to city documents, “approximately six-million square feet of office space needs to be removed from the market through leasing, conversion, adaptive reuse, and/or demolition to help address downtown office vacancy and stabilize downtown office property values over the next decade.”.Most of the bureau-speak ignores some cold hard facts..Based on the median tax rate in Calgary from 2020 (it’s much higher now), 401 homes will generate $872,042.67 in taxes per year, or 35.5 years to recover the $31 million..However, it’s unlikely the 401 condos will be sold at the median market price (one developer has announced 40% of its units will be sold at 20% less than market value) so throw out that 35.5 years figure..At $75 per square foot, the initial $45 million in grants will cover conversion of 600,000-sq.-ft. of space. To convert six million square feet will cost a minimum of $450,000,000 in grants..The mayor of Calgary is pretty good with the bureau-speak..“We’re focused on vibrancy when it comes to revitalization because ultimately, vibrancy encapsulates a thriving downtown,” said Mayor Jyoti Gondek. “These three exciting projects will help bring more people to live in our downtown core, which will help create a thriving, vibrant community in the heart of our city.”.No, three apartment buildings are not going to create a vibrancy that attracts people..In truth, there really isn’t any reason to live there..Sure, there are things to do — Flames games, the Stampede, a few restaurants that remain. There’s Arts Commons, the Glenbow Museum/JR Shaw Centre for Arts and Culture, and a few other others that are worth visiting, but not living near them..The city has not committed to 100% conversions downtown, mentioning the possibility of demolition, which is a good idea. Get rid of some of the buildings and build things that would make it worthwhile to live downtown..It would take bold leadership to explore demolitions and what added attractions would attract people, something we’re not likely to see from this city council or mayor..The ‘boldest’ things she has done include declaring a climate emergency, killing the arena/entertainment centre deal and taking away the freedom of Calgarians to protest lockdowns and mandatory vaccines, to name a few..Myke Thomas is a Western Standard columnist.,.mthomas@westernstandard.news
The heart of Calgary was its vibrant downtown core, home to thousands of offices, primarily of companies working the energy sector, where hundreds of thousands of people worked every day..Those companies used to pay some of the highest commercial taxes in the country, helping to keep residential property taxes relatively low..Some restaurants in the core used to see 1,000 people or more come in for lunch. Cocktail hour downtown used to be legendary, fueled by expense accounts..The operative words are ‘used to.’.The heart of the city began beating irregularly in 2014, when the price of a barrel of oil plummeted and was further exacerbated by the onslaught of the pandemic..Companies fled the core. Thousands upon thousands of people lost their jobs or worked from home. The vacancy rate of the high-rise office towers went from almost zero to as high as 32%. Earlier this year the rate edged down to close to 29%..The lights were turned off. At least five of the towers are completely empty. And residential property taxes have gone through the roof..A plan was needed to revitalize the core, a chore that fell into the bizarre bureaucratic arena known as city hall..The plan is called the Downtown Calgary Development Incentive Program, designed to spread $200 million across the core to bring it back to life..A good portion of that money — $45 million — has been set aside for building owners who agree to convert their offices into apartments. Developers will receive a grant of $75 per square foot that they convert, up to a maximum of $10 million per project..The city has announced three projects have been accepted under the plan, to convert three buildings — Palliser One (125 9 Ave. S.E.), HAT@Arts Common (205 9 Ave. S.E.) and a building that has sat empty for 10 years at 909 5 Ave. S.W.. thumbnail_palliserPalliser One (125 9 Avenue SE) . thumbnail_500_hatHAT@Arts Common (205 9 Avenue SE) . thumbnail_500_909909 5 Avenue SW .“These three projects will infuse life into largely empty or underutilized office buildings by converting empty office space to new residential units,” said the city in a release. “It’s one way we’re moving beyond the traditional 9-to-5 business district towards a vibrant city centre people enjoy 24/7, with a balanced mix of residential, office, retail, entertainment, tourism and culture.”.“The projects have been approved to receive, upon completion of construction, approximately $31 million and are expected to remove approximately 414,000 sq. ft of office space from the market and create an estimated 401 homes.”.According to city documents, “approximately six-million square feet of office space needs to be removed from the market through leasing, conversion, adaptive reuse, and/or demolition to help address downtown office vacancy and stabilize downtown office property values over the next decade.”.Most of the bureau-speak ignores some cold hard facts..Based on the median tax rate in Calgary from 2020 (it’s much higher now), 401 homes will generate $872,042.67 in taxes per year, or 35.5 years to recover the $31 million..However, it’s unlikely the 401 condos will be sold at the median market price (one developer has announced 40% of its units will be sold at 20% less than market value) so throw out that 35.5 years figure..At $75 per square foot, the initial $45 million in grants will cover conversion of 600,000-sq.-ft. of space. To convert six million square feet will cost a minimum of $450,000,000 in grants..The mayor of Calgary is pretty good with the bureau-speak..“We’re focused on vibrancy when it comes to revitalization because ultimately, vibrancy encapsulates a thriving downtown,” said Mayor Jyoti Gondek. “These three exciting projects will help bring more people to live in our downtown core, which will help create a thriving, vibrant community in the heart of our city.”.No, three apartment buildings are not going to create a vibrancy that attracts people..In truth, there really isn’t any reason to live there..Sure, there are things to do — Flames games, the Stampede, a few restaurants that remain. There’s Arts Commons, the Glenbow Museum/JR Shaw Centre for Arts and Culture, and a few other others that are worth visiting, but not living near them..The city has not committed to 100% conversions downtown, mentioning the possibility of demolition, which is a good idea. Get rid of some of the buildings and build things that would make it worthwhile to live downtown..It would take bold leadership to explore demolitions and what added attractions would attract people, something we’re not likely to see from this city council or mayor..The ‘boldest’ things she has done include declaring a climate emergency, killing the arena/entertainment centre deal and taking away the freedom of Calgarians to protest lockdowns and mandatory vaccines, to name a few..Myke Thomas is a Western Standard columnist.,.mthomas@westernstandard.news
