510 - 5th Street | 72m | 19s | Bluevale
- Thread starter thecivilengineer
- Start date
Thread for the office to residential conversion of 510 - 5th street.
Cowtown
Senior Member
I was going to report that the conversion is underway, but people beat me to it.
manshakesfistatcloud
Active Member
Yet another conversion. Does anyone work downtown anymore?
biospherian
Active Member
The vacancy rate is still at 30%. Very high.
Beltline_B
Senior Member
The rate is high, but is misleading. The 30% figure has garnered a lot of media attention, but the only real issue was the value of the empty buildings and its effect on property tax. It's not reflective of the number of workers or the vibrancy of downtown.
1) Before the vacancy rate spiked there were millions of square feet of class B and C office space that was leased but not being used, or were used but used very inefficiently. So many of my projects have involved moving a group of people out of a class B/C space into a Class A/AA space that's half the size. The newer Class A/AA buildings are design for higher density configurations.
2) The downtown vacancy rate is actually closer to 27%, and class AA space is around 15%. Still high, but not that much higher than say Edmonton or Montreal who's downtown rate is around 19%.
3) The number of people in employed in the CDB has held steady the past 4 years, and the rate of people coming into the office has been increasing. I don't know about all retailers, but Olly Fresco's for example has seen sales steadily increasing over the past three years.
4) Not necessarily related to the CBD, but greater downtown (CBD, Beltline) is seeing the number of employees increasing, though largely due to the Beltline. Downtown Calgary employees has increased from 137,000 (2016) to 161,000 (2024). The commercial core has seen fluctuations, but is ~100,000 - the same as it was in 2016.
In summary the vacancy rate isn't the issue people think it is. Yes, it's presented the city with a property tax challenge, but ironically it's turning into a blessing in regards to the downtown's vibrancy, The same number of employees, but double the number of residents. The city is targeting converting 6 million square feet of office space by 2034. If space used for offices remains unchanged, it would bring the vacancy rate down from ~27% to ~12%.
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FCC1982
Senior Member
Well that makes me feel a lot better - Thank-you Beltline B 
Beltline_B
Senior Member
The 30% figure keeps popping up, and while it's not great, it's not as bad as people think it is. On the Edmonton forum or on SSP, there are some members that bring up the 30% vacancy rate every time time someone says something good about Calgary lol.
Personally, I would say the higher vacancy rate is more of a blessing than a burden.
Personally, I would say the higher vacancy rate is more of a blessing than a burden.
zagox
Active Member
We are getting to a respectable level of downtown residential development, at a wide variety of price points, way faster than we ever could have with greenfield condo projects
JWhite
Active Member
That’s one thing I like about these conversions. Thousands of units suddenly appear out of nowhere.
It would take 20 years to get this many greenfield residential units.
It would take 20 years to get this many greenfield residential units.
KensingtonLurker
New Member
I think that having more residents downtown could also lead to increased office leasing. I know of one company that vacated downtown a few years back, as after surveying employees, they found that few lived there and a more suburban spot made sense for them. An extra 10 000 residents in DT may not tip that decision. But an extra 40 000 may. This wasn't a big company. Perhaps 20 000 sq feet, not enough to make a dent, but I would bet there are another 20 companies like them and that starts becoming significant. Personally, I think that after COVID, many people started realizing how much time they spend going to and from work. As we see more and more work from office mandates, hopefully more people will decide that they are willing to give up a few hundred square feet of living space in the suburbs to get an hour of commute time back. Based on just 4 days a week in the office, for 45 weeks a year, that hour saved is 180 hours or an extra 4.5 weeks of vacation per year based on a 40 hour week. I would also think that many families could consider going from 2 cars to 1 car by moving inner-city, saving a good chunk of cash every month, let's say $400 for $4800 a year. If they make $50/hr, then their 180 hour savings is worth $9000, add in $4800 for car and they are paying an extra $13 800 a year for a few hundred extra square feet. Many people probably value their family time at a higher rate than they do their work time.