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Urban Development and Proposals Discussion

It's hard to say whether the $75/sqft will be enough to encourage more conversions.

For reference, I believe the Barron Building is 11 stories and 100k sqft, and the GoA webpage estimates the project cost at $100M. Is 7.5% of project costs (100k sqft x $75/sqft = $7.5M / $100M = 7.5%) enough of an incentive? I'm not sure, although I'm also not confident in the accuracy of the $100M estimate for the Barron Building conversion, as $1,000/sqft seems high considering Telus Sky cost ~$400M to $450M for ~761k sqft (~$525/sqft to ~600/sqft), although I appreciate that conversion of an office building to a residential building will have unique challenges that a new build of a mixed-use building won't.

I actually think that the $10M cap might be the bigger deterrent to promoting conversions, although the Program webpage does indicate that City Council may approve a greater amount for a particular application.

As an example, Palliser One is 27 stories with typical floor plates of 16,700 sqft. I know that not all floors will be equal, and there is lobby space, but assuming that all 27 stories are 16,700 sqft, that's ~451k sqft. Without a cap, $75/sqft x ~451k sqft = ~$33.8M, which is ~$23.8M over the $10M cap, and only ~$11.2M below the approved budged of $45M for conversions. I don't trust the $1,000/sqft conversion cost from the Barron Building example above to apply to Palliser One.

Do I think that $10M would be enough to convert a building like Palliser One? Maybe, maybe not. Do I think $33.8M would be enough? Yes I do.

The article indicates that the Program "hopes to...help remove nearly half of the 14 million square feet of downtown office space sitting empty" , but the City has only approved $45M for office conversions. 7M sqft x $75/sqft = $525M. That's a $480M shortfall, although it seems like City officials are prepared to go to Council to ask for more money if there is enough demand.

$75/sqft may not be enough, and I think the City will seriously have to consider applications that exceed the $10M cap, but it's clear that the City needs to start somewhere to address the downtown office space vacancy issue (which is in-part, due to the downturn, but also in large part due to Calgary having such a high supply (on a sqft per capita basis)). The incentive program is likely going to be a trial and error, and it seems like the City is willing to take that approach.
 
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Also a fair point. In reality, the most effective policy lever council should be chasing is to have the property tax system reformed. It seems the entire basis of this is to try and get value back into the downtown core, which has been hammered by low vacancy rates. However, that doesn't mean the city collects less taxes, it just meant small businesses and commercial properties outside the core paid a lot more. This program is one way council hopes to relieve that burden, in the hopes the downtown will rejuvenates and continue to pay an outsider portion of the budget.
 
MichaelS said:
Also a fair point. In reality, the most effective policy lever council should be chasing is to have the property tax system reformed. It seems the entire basis of this is to try and get value back into the downtown core, which has been hammered by low vacancy rates. However, that doesn't mean the city collects less taxes, it just meant small businesses and commercial properties outside the core paid a lot more. This program is one way council hopes to relieve that burden, in the hopes the downtown will rejuvenates and continue to pay an outsider portion of the budget.
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The Municipal Government Act should be amended so property values are assessed every four years rather than annually. It would allow municipal governments to better plan annual budgets.
 
haltcatchfire said:
Does it matter when they just revise the mill rate to suit?
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Exactly. The real issue is how rhe City targets a certain percentage of revenue from commercial vs. residential and within the take from commercial, a percentage from dt. The dt cash cow is unlikely to return. The implication is austerity, probably like the 90's where the City more or less froze hiring and wages for a decade.
 
So I finally looked at the drawings. Looks like my instinct was right: the site is too small for the building...

I believe this lot is not part of the overall area owned by the City.
They should be calculating their limiting distances from Centre line of the street and not the Property lines. Maybe that's likely why it's so ugly and closed onto itself ?!

West "notch" is a foot from PL. Exits giving basically on the PL... weird.
North 8925mm from PL.
East 10 580mm from PL.
South 4460mm from PL.
 
frenchie-archi said:
So I finally looked at the drawings. Looks like my instinct was right: the site is too small for the building...

I believe this lot is not part of the overall area owned by the City.
They should be calculating their limiting distances from Centre line of the street and not the Property lines. Maybe that's likely why it's so ugly and closed onto itself ?!

West "notch" is a foot from PL. Exits giving basically on the PL... weird.
North 8925mm from PL.
East 10 580mm from PL.
South 4460mm from PL.
Click to expand...
What building are you referring too exactly?
 
There was some sort of rig set up on the gravel lot immediately west of the Simmons Building this morning. To me it looked like they were taking core samples or something along those lines. Perhaps an indication that the sale of this property is imminent and the prospective buyer is doing the last of their due diligence?
 
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