A new report from the Canadian Urban Institute (CUI) says vacant and underutilized office space present an opportunity to revive downtowns affected by the global pandemic and increase housing supply.

Right now, millions of square feet of office space sit empty in buildings across Canada and fewer workers are coming downtown since the COVID-19 pandemic.

Recently released, The Case for Conversions: Understanding opportunities for converting office space to housing in Canadian downtowns explores how conversions can remove excess office space and create housing while giving a boost to downtowns.

CUI’s work on office conversions builds on its efforts to leverage underutilized assets to create vibrant, equitable, livable, and resilient communities and strengthens its leadership on the importance of downtowns to Canada’s economic, social, and cultural sustainability.

“Stakeholders at all levels who know how important strong downtowns are to the health of Canada’s cities need to come together to optimize what’s already there,” says Mary W. Rowe, President and CEO of CUI.

“With the right enabling policies and investment decisions, commercial conversions can help revive the vibrancy and resiliency of downtowns as part of a larger strategy to bring people back into the hearts of their cities.”

The report looks at potential for office-to-residential housing conversions in six sample cities – Victoria, Regina, Winnipeg, Ottawa, Halifax, and Moncton – and outlines four conditions that enable conversions: building types, policy/regulatory context, location, and market conditions. Cities were highlighted based on the existence of policy readiness, office vacancy, and acute housing need. In each, buildings have been identified by Gensler Architects that offer optimal characteristics for understanding conversion feasibility.

“Calgary was an early adopter in harnessing the potential of office to residential conversions, leveraging key opportunities as drivers of economic growth and contributing to downtown revitalization. Strategic collaboration between all levels of government, based on the Calgary model, should be embraced as a best practice to be leveraged by other cities across Canada,” says Mark Garner, CEO of Calgary Downtown Association.

Adds Glenn Castanheira, general manager of Downtown Montréal: “This report demonstrates that Canada’s downtowns have untapped potential to diversify while addressing the housing crisis. It is high time to modernize our downtowns and make them complete neighbourhoods to live, work and play.”

Key findings about office conversions:

• Potential exists to create 18,000 to 22,000 housing units in just 11 cities
• Viable solutions to financial and policy barriers exist
• Conversions can be complex and costly, but can still take less time than new development
• They offer value propositions for a diversity of stakeholders
• They offer a chance to rethink how we plan and build cities
• There are economic and environmental risks to NOT pursuing them
• Successful models abound: many cities around the world have implemented successful processes and policies that make office conversions easier and more appealing

Funding for this work was provided by CMHC (Canada Mortgage and Housing Corporation) for a Housing Strategy Solutions Lab. Solutions Labs provide funding to stakeholder project teams to examine persistent, complex housing issues and rapidly develop potential solutions.