Aug 15, 2026
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Add us on GoogleDowntown Calgary has more empty office space than almost any city in the country — and the city has spent five years paying developers to fix that.
In June 2026, the City of Calgary reopened funding for what’s now called the Downtown Office Conversion Program, with an extra $25 million on the table and better terms for developers who convert unused office towers into apartments, hotels and other housing.
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As a renter, these developer cash incentives sound appealing, as it should result in the creation of more rental units and more supply means more choice and, eventually, more competitive rental rates. But it’s the developers that are really benefiting from this new-housing incentive.
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What changed in the relaunch
The City of Calgary housing incentive program isn’t new. Initially, it was launched in 2021 under a different name, the Downtown Calgary Development Incentive. In May 2026, city council approved an updated version and relaunched the program, accepting new funding applications from June 16 to July 27, 2026.
The relaunch did highlight three significant changes.
First, the City of Calgary added an “impact” criterion that gives extra weight to applications for affordable housing, larger projects and creative commercial reuse. Second, the incentive for converting office space into a hotel rose from $60 to $75 per square foot. Third, a new competitive-bid stream — also worth up to $75 per square foot — opened the program to seniors’ housing, student housing, co-living and life-sciences space, uses that previously didn’t qualify.
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What the program has to show for it so far
Money.ca could not verify a widely cited figure that the City of Calgary had set aside $40 million for office conversions in its 2026 budget.
City council actually debated cutting the program entirely during 2026 budget adjustments before settling on $35 million — $25 million for this funding round, plus $10 million held back for a separate, non-market conversion stream, according to an article published on LiveWireCalgary.
So, what did this influx of new money buy? Essentially, more concrete. There are now 21 incentivized projects completed or underway; these projects will convert 2.68 million square feet of office space into 2,667 new homes, one 226-room hotel, and a hostel, according to the City fo Calgary Downtown Office Conversion Program documentation.
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Eight of those projects are finished, adding close to 800 homes and 226 hotel rooms. Plus, this conversion project helped remove nearly 2.7 million square feet of office space from the city’s downtown core.
“Five years into a ten-year plan [and] we’re nearly halfway to our goal of removing 6 million square feet of downtown office space,” explained City of Calgary’s Director of Downtown Strategy, Thom Mahler, in a June statement. “These updates build on that success and create new opportunities to transform underused office space into vibrant places for people to live, work and visit.”
What it means for your rent and your wallet
None of this changes what’s available to rent in Calgary this month. The money moving through city hall this summer won’t help renters this fall. Conversions take years — permitting, construction and leasing — so most of the 2,667 homes tied to this program are still years from a move-in date. If you’re renting now, treat this as a signal about supply in 2027 and beyond. Instead, renters should watch for pre-leasing announcements on named projects and consider how these opportunities will reflect current market conditions.
As a Calgary taxpayer, the $25 million in incentive funding, on top of what’s already been committed to 21 projects, is your money. The plan is to invest public money in private developers to solve a vacancy problem largely caused by remote work and energy-sector downsizing. While the pay-off may not seem immediate, the opportunity to create a new tax base — from more residents in the downtown area — and more business for these communities could eventually help revitalize the city’s economy.
For investors weighing whether office-to-residential conversion is right for your investment portfolio, start preparing. While the application window for developers is closed for this round, the City appears to reopen regularly. Being familiar with the requirements and with the developers best poised to capitalize on this program will help investors narrow down the best private equity investment opportunities or, potentially, well-funded real estate investment fund investments.
Bottom line
Calgary’s office-conversion incentive is one of the more effective housing-supply tools used by any Canadian city, right now. The math on space converted and homes created backs that up. But the benefits of these conversions won’t trickle down to each community segment at the same time and in the same way. Developers — and investors helping to fund those developments — will be the first to benefit, with taxpayers and renters waiting years before realizing the advantage of these builder incentive programs.
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Romana King, Senior Editor at Money.ca, also writes for various North American publications and the RKHomeowner blog. Her book, House Poor No More, is an Amazon bestseller and five-time award winner, including the 2022 New York CPA Society's Excellence in Financial Journalism (EFJ) Book Award.
