If David Wallach, President and CEO of Barclay Street Real Estate, had been asked a year ago what the state of Calgary’s real estate industry was, his response wouldn’t have been far off from doom and gloom.

But one year on, the prospects for Calgary’s markets in commercial sectors like retail, industrial, and even downtown offices are looking up.

That, he said, is a blessing for everyone in the province.

Wallach, along with 85 other brokers and real estate professionals gathered for the TCN Worldwide Fall Conference in Calgary, which brought together some of the top independent real estate firms internationally from locales like Texas, Mexico, and Romania among others

At the top of those conversations being had by brokers were about the opportunities for investment into Calgary, Wallach said.

“One of the questions I was asked by one of the brokers is, ‘should I bring investors here?’ I gave him a whole speech why he should so I see that as a great opportunity for us to showcase Calgary, to showcase Alberta, and for our clients.”

That change has come as headwinds caused by the oil-crash, followed by the pandemic, followed again by the post-COVID inflation boom are starting to recede, said Wallach. In its place, Calgary has become one of the best markets in North America for commercial real estate.

“Our market right now is getting hotter and hotter, and we like it this way, because it creates a lot of opportunities for us and creates a very vibrant market,” he said.

“What happened in Toronto and Vancouver, with prices going out of control, and now with Alberta creating jobs and seeing a lot of migration within the country, not just immigration… Calgary, Edmonton, and the whole province are the hottest markets right now in Canada.”

Forget Vancouver and Toronto, Calgary is hot stuff

Ross Ford, President of TCN Worldwide, said that investors have been looking at markets like Toronto where the prices are extremely high and are therefore unable to satisfy the needs of the investment community, or for people actually looking to live in their homes on the non-commercial multifamily side of the industry.

“That’s a factor we’re seeing on many cities in North America, not one that has really been experienced here,” Ford said.

“I would add that’s really across in terms of North America as a whole. Calgary and Alberta overall are definitely one of the hotter areas in terms of both growth and opportunity, and we’re seeing that as investment dollars, if you will, are continuing to flow into the area, as opposed to looking for alternative investments outside and on the multifamily side.”

Ford said that overall what the industry has seen is the traditional cyclical ebb and flow of business, based on investment opportunities and interest rates. However, the entire worldwide real estate industry is undergoing a huge transitional change due to the pandemic and post-pandemic economy.

“We’ve gone through over the last five years, an epidemic that the world had never anticipated, nor experienced in quite a long time, and that impacted the business environment. It’s changed the office use. Office users aren’t going back to the buildings that were designed as they were in the past,” he said.

“This transitional change means that this is an opportunity to grow and expand, and Calgary is on the front end of that. So, the message that we’re sharing with our attendees is that, yes, take advantage of what is going on. Don’t look at how either you did business or how your clients did business in the past, but instead, look to the future.”

A component of that change in opportunities was the federal government and City of Calgary investment into the downtown conversion of office buildings, Wallach said.

It’s a program that was recently renewed for funding by the federal government, allowing it to continue.

“If you look at major cities all over the world, not just North America, downtown residence is a major component of making it a vibrant community. If you look back on Calgary 15 years ago, 5:30 p.m. downtown looked like a curfew. Everybody went to the suburbs,” Wallach said.

“Creating a vibrant environment here for residents will be a great message, and also will create a lot of demand for more office space, because people that will live here may want to work here and don’t want to drive to suburbia to work. So, it’s a very positive move. I think council, making the decision to continue funding the conversion, is a right move.”

He said that the program has begun to remove undesirable office buildings due to the change in demands by tenants.

“We have some buildings on the west side, especially of downtown, that are completely obsolete in terms of office space today. Office users want to see a different office than it was 20 years ago. So if you don’t have the amenities, if you don’t have windows from ceiling to floor, people don’t want to work there,” Wallach said.