Calgary is considering a tax incentive to spur the servicing of industrial land in its greenfield area, as competition from surrounding jurisdictions continues to erode investment.

Members of Calgary’s Executive Committee were presented with a plan at the March 3 meeting to offer a 20 per cent municipal property tax incentive to help increase the amount of shovel-ready industrial land that would ultimately lead to development and an increase in the non-residential tax base.

It was approved unanimously by 10 members attending the Executive Committee meeting and will be forwarded to an upcoming meeting of council for final approval.

Ian McDermott, manager of non-residential with the City of Calgary’s assessment and tax division, said that the proposed bylaw creates an incentive program targeted to increase development attractiveness.

“Calgary continues to see demand for new industrial buildings, but the supply of industrial shovel-ready land to support that continued growth is shrinking because of cost pressures,” he said.

“The demand for those new buildings is what’s growing the non-res base. Adding to the supply of shovel-ready industrial land will ensure a strong pipeline for building, which is essential for supporting continued non-residential growth and benefits all.”

McDermott said that Calgary has roughly 2,700 hectares of vacant industrial land, though only seven per cent of it is shovel-ready. Further, he said that historically, roughly 50 to 65 hectares of land are absorbed annually, with only 42 hectares of land developed privately since 2016.

“This incentive improves industrial Calgary’s industrial attractiveness by directly addressing property costs, property tax cost pressures that have contributed to a stalled private investment in Calgary,” McDermott said.

“Without intervention to address the property tax barrier gap, to develop more land, Calgary risk impacts to its attractiveness as a strong industrial sector and losing development to surrounding jurisdictions.”

The plan is just one element of the City of Calgary’s Industrial Action Plan, which was approved back in June 2025.

Stakeholders behind the industrial property tax incentive plan

McDermott said that the property tax incentive was supported by industry stakeholders who were part of a working group put together to address the industrial land supply challenge.

A letter from Brad Parry, president and CEO of Calgary Economic Development, acknowledged the limited availability of serviced land in the city limits.

“This limited inventory of shovel-ready sites can slow timelines, delay investment decisions, and result in missed opportunities for Calgary,” he wrote in a letter submitted to the committee.

“Industrial land is crucial for local business growth and attracting foreign investment that supports Calgary’s economic resilience and prosperity.”

McDermott provided a case example that showed, based on the eligibility criteria, what it would cost the City of Calgary in non-residential tax revenue in the short-term, with a long-term benefit that was nearly 10-to-1.  He also noted that additional developed land would have a small negative impact on current non-residential ratepayers, but would end up saving hundreds annually once the newly-developed land was brought online.

Calgary has been in constant competition with surrounding municipalities to attract industrial development, largely because of the imbalance in the property tax regime. While this addresses that, Coun. Andre Chabot said industrial developments receive a far better bang for their buck in Calgary.

He said it was a great first step to driving more development.

“I think one of my uncles said it best, that the wind doesn’t blow through the city of Calgary. The City of Calgary creates its own wind, and so we tend to have so many added benefits for folks to develop within our municipal boundaries and the amount of services that the city offers,” Chabot said.

“It’s hard to compare ourselves to other industrial opportunities outside of our boundaries, because what we offer for additional services, including fire protection, police protection, those things alone, have such a great advantage over our surrounding neighbours.”

Ward 6 Coun. John Pantazopoulos said it’s hard to ignore the payback of the proposed incentive.

“I’d love to have a conversation with a Calgarian, that says, ‘for a $10 investment, for two years, we’re going to give you $114 going up in perpetuity,’” he said.

“I guess, from one councillor’s perspective, all day, bring these ideas all day. This is a huge economic incentive, not only for the five times MGA threshold (non-residential to residential tax ratio), but all day. That’s a material impact to Calgarians that for a small, incremental investment today.”