CALGARY, Alberta — In the heart of Canada's energy capital, the push to revive a post-pandemic downtown has sparked a heated debate over where public dollars should flow: toward bailing out struggling corporate real estate giants or investing in amenities that draw people back to the urban core. As office vacancy rates linger high amid remote work trends, city officials in Calgary have committed hundreds of millions of dollars in incentives to convert empty office towers into residential spaces, a policy critics argue unfairly prioritizes property owners over everyday residents and small businesses.
According to a recent opinion piece in the Calgary Herald, this approach exemplifies a broader economic double standard where "big corporations stumble, it becomes a public emergency," but "when ordinary people stumble, it’s a private problem." Robert Renger, a retired city planner, wrote that while the logic behind office-to-residential conversions is "straightforward — empty offices hurt everyone, so everyone should help fix them," the subsidies raise questions about equity in urban recovery efforts.
Calgary's incentive program, launched in recent years to combat downtown vacancy rates that have hovered around 20 to 25 percent since the COVID-19 pandemic began in 2020, offers up to $15 million per project. The city has allocated hundreds of millions overall to these conversions, aiming to preserve tax revenue and prevent a "downward spiral in the core," as Renger noted. Proponents, including city economic development officials, argue that without such support, many aging office buildings would remain vacant, exacerbating economic stagnation in the city's central business district.
Yet Renger contends that this model treats corporate distress as a "collective risk" while viewing individual hardships — like job loss for renters or closures for small shop owners — as personal failings. "A landlord may receive millions for a conversion, while the café forced to close downstairs gets nothing," he wrote. "A property owner is framed as essential to the city’s ‘economic infrastructure’; a household or a small business is expected to shoulder hardship alone."
The debate comes at a pivotal moment for Calgary's downtown, which has seen foot traffic plummet since early 2020. Related events, such as the 2022 UCP convention where Premier Danielle Smith faced boos over economic policies, underscore the political tensions surrounding urban recovery. Meanwhile, local news has reported on issues like a new McDonald's in the Bridgeland neighborhood drawing mixed reactions due to concerns over traffic and social disorder, highlighting broader challenges in balancing commercial development with community needs.
Renger points to public investments as a more equitable alternative, arguing that amenities like libraries, parks, and transit hubs have "repeatedly proven their ability to transform neighbourhoods far more reliably than private bailouts." He cites Calgary's own Central Library in the East Village as a prime example. Opened in 2018 after costing around $245 million — roughly equivalent to the funds allocated so far for office-conversion incentives — the library has been internationally acclaimed for its architecture and social impact. According to Renger, it "didn’t bail out any distressed landlords, yet it immediately strengthened the East Village’s appeal, catalyzing private housing, retail and public-realm improvements."
Cities across North America have adopted similar public-led strategies with success, Renger notes. For instance, investments in parks have drawn foot traffic to support retail, while cultural facilities have sparked tourism and transit upgrades have boosted mobility. "Parks draw foot traffic that supports retail. Cultural facilities spark tourism. Transit improvements increase mobility and footfall. Streetscape upgrades encourage private developers to build housing because the surrounding environment is already vibrant," he wrote.
Defenders of the current subsidies, though not directly quoted in Renger's piece, have argued in city council discussions that without incentives like the $75 per square foot subsidy, conversions simply wouldn't occur. Renger counters this, suggesting that removing the support would merely force office tower owners to sell at a lower price to interested developers, without halting the process entirely. City officials, in statements to local media, have emphasized that the program is temporary and targeted, designed to kickstart a market that private investors alone might not revive quickly enough.
The opinion piece arrives amid ongoing discussions about Calgary's urban policy, including a recent Calgary Herald report on a murder suspect's court appearance where he claimed little recollection of a brutal attack in his home, illustrating the social strains in some neighborhoods. Broader economic context includes the city's efforts to diversify beyond oil and gas, with downtown revitalization seen as key to attracting tech and creative industries.
Renger's critique extends to the philosophical underpinnings of "too big to fail," a concept popularized during the 2008 financial crisis when governments bailed out major banks. In Calgary's case, he argues, empty office towers are deemed threats to the city's future, justifying multimillion-dollar rescues, while evictions, small business bankruptcies, and rising homelessness are not afforded the same urgency. "If empty towers justify major public rescue because they threaten a city’s future, then surely evictions, bankruptcies and homelessness threaten it, too," Renger stated.
Public response to these policies has been mixed. While some business leaders praise the incentives for stabilizing property values, community advocates have called for more support for affordable housing and social services. In a related development, the Calgary Herald covered Black Friday crowds packing a local mall, signaling consumer resilience but also the uneven recovery across retail sectors hardest hit by downtown shifts.
Looking ahead, Renger urges a shift toward "public-led revitalization," where cities invest in civic spaces to create conditions for organic private growth. "Instead of granting corporate subsidies that de-risk private investments, cities should focus public investment on the civic spaces and infrastructure that create the conditions for organic private investment," he wrote. Calgary's next budget cycle, expected in early 2024, could provide an opportunity to reassess these priorities, with council members already signaling debates over funding allocations.
The implications of this choice ripple beyond Calgary. As other Canadian cities like Toronto and Vancouver grapple with similar downtown vacancies — Toronto's rate at about 15 percent and Vancouver's nearing 10 percent, per recent real estate reports — the model of corporate subsidies versus public amenities could influence national urban policy. Economists have noted that while short-term incentives may fill seats in empty buildings, long-term vitality depends on making downtowns livable and appealing to residents.
In Calgary, where the oil downturn of 2014-2016 already tested the city's resilience, the current approach risks widening inequality, according to critics like Renger. "‘Too big to fail’ has been accepted as economic law. But it is really a political choice," he concluded. "And at a time when cities are deciding how best to support their cores, they should choose the option that supports people, not just property owners."
As the debate unfolds, stakeholders from city hall to community groups await decisions that could redefine Calgary's skyline — not just its buildings, but its social fabric. With incentives set to continue through at least 2025, the coming months will test whether public priorities align more with towers or the people who inhabit them.