Even Calgary’s downtown strategy director, Thom Mahler, admits that for the past three years, there’s been a lot of money and multiple projects announced, but not many units.

Until this year.

The City of Calgary released its Q3 downtown strategy update this week, and with it, a substantial number of new units on the market, which were a direct result of the Downtown Calgary Development Incentive Program.

According to data provided by the City of Calgary, thus far in 2025, six projects have been completed, adding 490 units, with 170 units deemed affordable or below market rentals. There’s enough room for 784 residents. 

They’ve also added one new post-secondary (opening January 2026) and 226 new hotel units. Summed up, 659,748 square feet of office space has been removed in 2025.

“It’s really encouraging right now, because how I think about this lately is we’ve been talking about things for probably three years—from the time we got money from council to do things, launching a program, announcing projects that got funded, but we didn’t really see the tangible results,” Mahler told LWC.

“I think in Q2, Q3 we’re actually seeing, like, you can drive around now or walk around and you can see the actual construction projects.”

Recently, the Dominion Civic Apartments were completed, adding 132 suites. The developer, Alston Properties, said that those units were already 50 per cent occupied.

In March, Cidex added THE HAT at Eau Claire, bringing 87 more units online.

“I think it’s changed the awareness of what we’re trying to do, and the impact of actually starting to be seen in physical,” Mahler said.

“When you look at the numbers, it also shows we’ve definitely caught the interest of investors, and not just local investors now, or we are attracting investment from other parts of the country as well.”

According to the city, roughly $805 million in outside investment has been brought in. To date, the City has put in $198 million, according to Mahler.

Debate over more office-to-residential conversion cash

When the plan to convert office space was first hatched, Mahler said the City of Calgary pegged $450 million over 10 years would be needed to achieve the goal of removing millions of vacant office space.

Under the program, eligible developers can get up to $75 per square foot, up to $15 million per project. The money is paid out once the project is complete and the units are online.

In the 2026 proposed budget adjustments, city administration is seeking $40 million to continue funding the conversion program.

Not all councillors are convinced it’s the best way to spend taxpayer money. It’s one area that some members of city council are targeting to help provide property tax relief.

In early November, Ward 2 Coun. Jennifer Wyness called it a “luxury spend” that isn’t providing Calgarians a return.

“That’s a completion bonus that developers get to take out of the Calgary market if they so choose,” she told LWC in early November.

“The entire office conversion is self-funded off of lending and other programs. So, why am I socializing increased profits for an office conversion when Calgarians have spoken with some of the latest announcements that they don’t even see them as affordable?”

In the LWC 2025 candidates survey for the municipal election, several of the successful candidates opposed city cash for the downtown conversion program.

“No. Downtown conversions should be led by the private sector, though I get the City’s interests,” wrote Ward 6 Coun. John Pantazopolous, in a question on support for downtown conversions.

“Empty towers help no one, and conversions can revive downtown. Subsidies must be managed carefully—tax dollars should go first to basics like roads, infrastructure, and safety.”

Ward 11’s Rob Ward also opposed Calgary taxpayer dollars being used.

“I support revitalizing downtown, but not by burdening taxpayers,” he wrote.

“Office-to-residential conversions should be driven by private investment and higher levels of government.”

Ward 8 Coun. Nathan Schmidt and Ward 9 Coun. Harrison Clark, however, both supported the idea of creating more housing in the downtown.

Development would stall without funding: Mahler

Back in 2022, when office-to-residential conversion projects were first being announced, PeopleFirst Developments CEO, Maxim Olshevsky, talked about a brochure he’d received in 2018  highlighting an empty office tower that was available.

“It took me three seconds after that to fall in love with the idea of what it could be, and then it took me two months to realize no matter how much perseverance I have, it’s cost-prohibitive. You just can’t do it on your own. So, my hopes and dreams came crashing down,” he said in 2022.

“Three years later, the stars lined up, and one of the stars is the development of the incentive program. Thanks to the downtown strategy team, their vision and support removed the biggest obstacle that individuals like myself and developers, and property owners face when they would undertake such projects.”

To that end, Mahler said he believed the projects wouldn’t go forward without the subsidy.

“They would not. I think that’s clearly the message… we survey the developers regularly… they said none of these projects would proceed without that initial city investment,” Mahler said.

Not just because it helps the developers, he said, it also helps in the risk assessment for lenders when they see a project has funding support.

“Office conversions are not popular for financial institutions; they’re not familiar with them,” Mahler said.

“So, by doing all this de-risking of the program, through our program, both the money and the permit delivery and construction approvals, that’s what’s allowed these projects to go.”

Further, Mahler said he believed the benefit to Calgarians went far beyond adding new units to Calgary’s housing stock. By increasing the value of downtown buildings when they’re occupied, they pay more property tax. He said that limits the increase borne by other residential and non-residential property owners.

That’s what started the program years ago, he said. The troubling office vacancy rate, along with the massive drop in property values created a considerable budgetary hole that had to be sewn up. The downtown strategy was developed, with office to residential conversions were a part of that.  Now, the investment has led to more new businesses popping up in the area, along with more events and area activations.

“It just so happened that it meshes perfectly with the need to diversify our downtown, because we lost all of those office employees and to recondition our downtown for ongoing investment,” Mahler said.

“It’s just very much a strategic investment that aligns with so many of the other city objectives.”

Mahler is confident that as more units are brought online and “tangible results” are shown, perspectives on the value of using Calgary tax dollars to help fund it will shift.

“I’m not a developer, but it’s pretty cool as a city employee to take some pride in these projects that we actually had a hand in delivering, in the same pride that a developer would,” he said.

“I think that’s partly what contributes to that momentum is the tangible impact of making a difference, and that will trickle down.”