Since the City of Calgary’s Downtown Development Incentive launched in 2021, more than $100 million has been granted to projects that will remove more than 1.35 million square feet of vacant office space from the market and convert it into residential housing. Currently, there are 10 projects throughout the inner city at different stages of development. These include the Natural Resources Building, the Petro Chemical Building, the Petro Fina Building and the historic Barron Building — all slated for conversion with support of the City’s incentive.
At a time of accelerated population growth and low rental vacancy rates, office-to-residential conversions have added roughly 150 units to Calgary’s rental stock — a number expected to reach 1,420 when all 10 projects are complete. Peoplefirst Developments’ Petro Fina Building is the first office-to-residential conversion to become available on Addy, a crowdfunding platform for real estate investors. Launched on April 20, Petro Fina met its $500,000 crowdfunding target in just two weeks.
Despite the current hype, converting commercial buildings for residential uses isn’t new in Calgary. Building adaptations in the 1990s created loft residences out of warehouses in the Beltline — today some of the most-desirable addresses for urban living in Calgary — while Strategic Group’s 2019 conversion project, Cube, paved the way for adaptive reuse of office buildings in the city.
Here are five commercial-to-residential conversions that have helped shape Calgary’s urban core.
Hudson Lofts – 535 10 Ave. S.W.
Strategically located at the corner of 10th Avenue and 5th Street S.W., and adjacent to the railway tracks, this 55,000-square-foot building was constructed in 1912 as a warehouse for the Hudson’s Bay department store.
After hosting myriad tenants between 1925 and 1993, including the Alberta Liquor Control Board and Safeway, the six-storey warehouse was purchased by Apex Land Corporation in 1993 for $650,000 and converted into New York-style lofts — the first of their kind in Calgary.
The flexibility of the building’s rectangular footprint and timber structure allowed for its swift transformation and contributed to its timeless appeal. The Hudson’s red brick facade, adorned with frieze mouldings, encases modern interiors that feature exposed 16-inch Douglas fir beams and 12.5-foot ceilings.
One of the challenges of this conversion was adapting the components of an aging structure to modern standards, requiring a close collaboration between the building’s developers and the City. With prices starting at $100,000, and a wait-list of 230 prospective buyers, 29 of the 31 condo units sold within a month of the building’s launch in November 1993.
The success of The Hudson sparked the transformation of three other commercial buildings in the Beltline into the Lewis Lofts, Imperial Lofts and Manhattan Lofts.
Three decades after the first conversion, the interest in loft living hasn’t waned. Ranging from $500,000 to $1 million, a condo at The Hudson is comparable to any other luxury condo in the Beltline.
Manhattan Lofts – 1117 1 St. S.W.
Built in 1906, the building that is now the Manhattan Lofts is one of Calgary’s most distinctive pre-war era structures. A mix of live/work uses and high-profile tenants, including artist Paul Van Ginkel, make a Manhattan Loft a coveted find.
The building was originally designed by architects William Bates and Gilbert Hodgson, whose work includes Calgary’s Grain Exchange Building and St. Mary’s Cathedral, to function as the Pryce-Jones department store. After sitting vacant for many years, a group of Edmonton investors purchased the derelict building in 1993 for just under $1 million, with the goal of converting it into condominiums. With a budget of $5 million, the initial plan fell through, but the original owner, United Inc., went ahead with the retrofit project, with a design led by architect Manu Chugh.
The transformation of the building into 38 condo units didn’t go smoothly. The retail-intended design made it more difficult to adapt than an open-layout warehouse, as only the pillars and elevators could be preserved. Moreover, the installation of balconies and large-expanse windows meant additional pressures to the conversion challenges, as the architects had to replicate the unique features of the original facade in the new elements.
Despite a sluggish start in sales, Manhattan Lofts have only increased in value. When the building launched in 1994, condos could be purchased for less than $200,000. Earlier this year, a real-estate listing advertised a one-bedroom, 1,039-square-foot unit for $535,000.
Cube 1177 – 11 Ave. S.W.
In the economic downturn following the global recession of 2015, high office-vacancy rates encouraged many companies to move to newer buildings at a discounted cost. As a result, in the summer of 2019, Strategic Group’s Stephenson Building had a 95-per cent vacancy rate, and its assessed value had dropped from $21.5 million in 2009 to $8.4 million.
Aware of the shortcomings of an outdated Class B building, and having already completed a similar project in Edmonton, Strategic embarked on what would become the first office-to-residential conversion in Calgary’s inner city in more than a decade.
The features that made this building less than desirable for offices were the very characteristics that enabled its transformation. While offices today require large open floor plates (the total floor area of a storey within a building’s structure), the Stephenson Building’s respective floor plates of around 9,120 sq. ft. made it ideal for residential, as this size allows for spacious units with access to sunlight and ventilation.
By the end of 2019, the renovations to Cube were well underway. To ensure the building’s past use didn’t make for a hostile experience for residents, the design team selected a warm colour palette of reds and hints of yellow, complementing a neutral base in various shades of grey. Modern finishes and upscale amenities, such as a rooftop patio, make it as livable as any other apartment building in Calgary’s Beltline communities.
At a total cost of $25 million (which included a dive into the project’s contingency budget), it took 10 months for the 65 units to be completed.
Cube welcomed its first tenants on May 1, 2020.
Neoma – 706 7 Ave. S.W.
In 2021, the HomeSpace Society acquired downtown’s Sierra Place for $4.7 million, with the purpose of transforming it into affordable housing. Long past its former days as the headquarters of Dome Petroleum, the 1958 building had sat fully vacant since 2019. But, like Strategic Group’s Stephenson Building, the features that made it unattractive as office space made it suitable for residential conversion.
In the fall of 2021, conversion of the 10-storey building began, but so did the challenges inherent to co-ordinating design, demolition and construction — all at the same time.
While the building had “good bones,” some components couldn’t be preserved, despite their heritage value. Sierra Place’s unique aluminium facade with granite-clad pillars had reached the end of its life and didn’t meet current fire ratings, so it was replaced with metal panel cladding.
Using an innovative approach based on trauma-informed design, the architectural program of the building included 82 family-sized and single-sized units plus 10 units of second-stage housing, as well as wraparound services for Inn from the Cold families.
At a total cost of $20 million, in September 2022, Neoma was ready to welcome families in need — on time and on budget. The array of bachelor, two- and three-bedroom apartments offer safe and stable places to live for lower-income Calgarians. Monthly rental rates range between $608 and $968 — about 37 per cent lower than market rate.
The Cornerstone – 909 5 Ave. S.W.
Formerly the SNC-Lavalin Building, The Cornerstone was part of the first round announcements of the Downtown Calgary Development Incentive. It is currently under construction, with substantial completion expected by the end of this year.
Constructed in 1978, the building was purchased in 2021 by Peoplefirst Developments, just weeks after the City’s incentive was announced. “The moment it became clear that the City grants were coming to fruition, we decided to pull the trigger on the building,” says Maxim Olshevsky, managing director of Peoplefirst Developments. Although the amount Peoplefirst paid is confidential, at its peak in 2014, the building’s assessed value surpassed $40 million. After sitting vacant for nearly a decade, it was listed in 2018 by Colliers International for $18.5 million.
With an estimated cost of $38 million, upon completion, the 10-storey building will feature 112 two- and three-bedroom units, with 40 per cent to be rented at below-market rates. The units will have in-suite laundry, marble countertops and stainless steel appliances — what Olshevsky deems “attainable luxury.”
“Our goal is to find the perfect balance between cost and value,” he says.
Olshevsky acknowledges the incentive provided by the City greatly reduces the risk for Peoplefirst to do these types of projects. In April, the company added the Petro Fina Building to its City-supported conversion portfolio, and has its sights set on Place 800, an 18-storey office building west of downtown.