Calgary
Forget the Horizon, Downtown Calgary is in Big Trouble Right Now
Do you travel through or live in downtown Calgary?
Do you glare at our skyscrapers and see only a few lights on?
This is a tale of a cowtown that stopped producing milk, even our ranch has closed. If there was a light at the end of this tunnel, not even our top economic spokespeople can offer any of us a realistic answer for where we are at now, or when we will even see the light. The economic destruction from COVID-19 continues to ravage the health of local businesses and almost every other industry that calls our city home. With that, there is a lot more to the story that reaches beyond March of this year. The question is, what does a pillar city in Canada do when their downtown is empty and graduates continue to emigrate?
Recent data from the CBRE from Q3 of 2020 show the office vacancy in downtown Calgary has hit 28.7%. That number may seem irrelevant without comparison to other metropolitan places in the country. The chart below shows the office vacancy percentages based on data collected of unused office space by square footage in the downtown core in each identified city.
Data Sourced: CBRE, “Canada’s Office and Industrial Quarterly Statistics Q3 2020”, CBRE.ca
The clarification we are lacking is that there is a very real problem with attracting commercial activity. The challenge lies within the lack of large firms that have more than 1,000 employees to fill these empty sky-high office buildings.
We cannot simply just ask companies to move their workforce, an example being Suncor’s recent decision to uproot 700 employees from Ontario to relocate to Calgary. Better described as 700 humans with families, friends and communities in Ontario. No figures have been released to state how many jobs will be coming to Calgary.
Almost within the same week, we see the consolidation of Husky Energy by Cenovus. This does make “fiscal” sense for the financial health and future of the company, becoming the third-largest oil and natural gas producer in the country. Citing a piece in the Financial Post by Diane Francis, Cenovus will close the Husky head office in Calgary, which is not reflected in the Q3 data released by the CBRE.
If we keep in mind that the headquarters for Husky Energy Inc was Western Canada Place, where we saw the Apache Corporation “strategically exit” Canada back in 2017. It will become clear in the near future that we could see another tenant evacuation of a huge building in downtown Calgary.
One piece of that 28.7% of our current office vacancy is due to Nexen leaving their building on 8th street completely vacant, setting up shop in the same building as the newly purchased Husky Energy Inc. In this case, bottom level retail such as cafe’s are not included as occupied office space.
If there are corporate tax incentives in almost every major city in the efforts of attracting big business, therein lies the question. What else can Calgary offer to sway large firms to come here? Take a look at the chart below stating the 2020 Corporate Income Tax Rates in Canada.
Source: TaxTips, “2020 Corporate Income Tax Rates”, Taxtips.ca
At some point in the recent history of Alberta, competitiveness turned into desperation. There is some benefit to local entrepreneurs looking to set up a business by lowering the barrier to entry, however, have we really seen that as a result of the lowest corporate tax rates in the country?
Looking at the fact sheet prepared by Calgary Economic Development in May of this year. As shown in the chart below, take a look at the new and renewed business licenses. It is crucial to note that COVID-19 has created a mountain of economic problems for almost every city, which we can assume had a major impact on the 2020 numbers seen below. We may see this continuing to decline as the pandemic continues to ravage our economy.
In addition, It is important to note the lack of new business licenses issued since 2017. This is not a new problem but has been exacerbated by COVID-19.
Calgary Economic Development, “Fact Sheet: Calgary Small Business”, 2020 Edition Published: June 24, 2020, p 6., Calgaryeconomicdevelopment.ca
When faced with a challenge, Calgarians do not quit. The piece of the puzzle that has yet to be found is to restore incentive to local and foreign investment. The ideology that big tech would eventually be “sold” on Calgary’s infrastructure has not gained traction.
Recent history teaches us that big tech follows big tech, an example being TikTok opening a new headquarters in Dublin back in August of this year, where companies such as Alphabet, Amazon, eBay, Paypal and Facebook also have European headquarters. While these names are well-known globally, the economic and sociological effect it could have on our city would offer Calgarians some indication that we are actually progressing in some way.
Consider being a graduate enrolled in an extensive and expensive program this year. The lack of economic progress is tied with the lack of jobs in a psychologically destructive way. If we cannot incentivize foreign investment and create new job opportunities, more importantly, how do we hold on to waves of eager graduates that are well aware of the benefits of moving to other cities or countries?
The narrative that new graduates carrying thousands of dollars in debt are given any chance to achieve anything close to previous generations in Calgary back in the high oil and gas days is now an irrelevant argument. Understandable that they may pack up and leave for greener pastures.
The evidence is in the 2019 Calgary Civic Census. The age demographic of 20-24 is our second lowest age demographic sitting at 5.94%, the lowest being the 15-19 year olds sitting at only 5.28%. The chart below shows the breakdown of our Calgary’s age segmentation.
Source: Calgary Civic Census 2019, “Civic Census Results 2019”, Calgary.ca
Cities such as Vancouver and Toronto last conducted their population census in 2016. The comparison data ranked Calgary 29th out of 35 cities in Canada for the age demographic of 20-24. Thinking about the cities you are aware of in Canada, to not even rank in the top 10 for young adults adds to the enormous problem we will be attempting to remedy for an unknown amount of time. This data can be seen clearly in a CBC post relating to this issue.
The information above may offer some real data that has very real implications. However, the narrative less documented is what sentiment do young people feel in Calgary and what is left to be proud of. It cannot just be the Stampede or nothing at all. Even after emigrating to another city or country, what is it that they tell their newfound community about their home city? The vibrant, creative and hard-working young people in this city have a fighting chance, but only if there is some benefit to their future staying here. Without awareness of foundational values, celebration of culture and real opportunity to rely upon in your city, understandably, young people will continue to leave and seldomly will ever return.
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References:
Calgary.ca, “Calgary Civic Census 2019.” 2019 Civic Census Results, 2019, p. 18, Calgary.ca.
CBRE, “Canada’s Office and Industrial Quarterly Statistics Q3 2020”, CBRE.ca.
Calgary Economic Development, “Fact Sheet: Calgary Small Business”, 2020 Edition Published: June 24, 2020, p 6., Calgaryeconomicdevelopment.ca
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For more stories, please visit Todayville Calgary
From the Frontier Centre for Public Policy
Calgary Transit is mired in the past, building an obsolete transit system designed for an archaic view of a city. Before the pandemic, transit carried 45 percent of downtown Calgary employees to work, but less than 10 percent of workers in the rest of the Calgary urban area, showing that Calgary Transit doesn’t really serve all of Calgary; it mainly serves downtown.
That would have worked in 1909, when Calgary’s first electric streetcars began operating and most jobs were downtown. By 2016, less than 15 percent of Calgary jobs were downtown, and the pandemic has reduced that number further.
Rather than design a transit system that serves the entire urban area, Calgary Transit light-rail system reinforced its downtown focus. Transit ridership has grown since the city’s first light-rail line opened in 1981, but it was growing faster before the light rail began operating than it has since then. Now Calgary Transit is planning even more downtown-oriented light-rail lines.
Light rail is an expensive form of low-capacity transit. The word “light” in light rail refers not to weight but to capacity: the American Public Transportation Association’s transit glossary defines light rail as “an electric railway with a ‘light volume’ traffic capacity.” While a light-rail train can hold a lot of people, for safety reasons a single light-rail line can move no more than about 20 trains per hour in each direction.
By comparison, Portland, Oregon runs 160 buses per hour down certain city streets. An Istanbul busway moves more than 250 buses per hour. Bogota Columbia busways move 350 buses per hour. All these transitways cost far less per mile than light rail yet can move more people per hour.
Once they leave a busway, buses can go on any city street, reaching far more destinations than rail. If a bus breaks down or a street is closed for some reason, other buses can find detours while a single light-rail breakdown can jam up an entire rail line. If transportation patterns change because of a pandemic, the opening of a new economic center, or the decline of an existing center, bus routes can change overnight while rail routes take years and cost hundreds of millions of dollars to change.
To truly serve the entire region, Calgary Transit must recognize that buses are faster, more flexible, and can move more people per hour to more destinations at a lower cost than any rail system. It should also recognize that modern urban areas have many economic centers and use buses to serve all those centers.
Besides downtown, Calgary’s major economic centers—the airport, the University of Calgary, Chinook Center, the Seton health center, and others—are mostly located near freeway on- and off-ramps. Calgary Transit should identify ten or so such centers geographically distributed around the region. It should locate transit centers—which need be no more than curbside parking reserved for buses with some modest bus shelters—near the freeway exchanges closest to each center.
It should then operate frequent (up to five times per hour) non-stop buses from every center to every other center. A few secondary transit centers might have non-stop buses operate to just two or three other centers. Local bus routes should radiate away from each center to serve every neighborhood of the Calgary urban area.
Since non-stop buses will operate at freeway speeds, the average speed of this bus system will be more than double the average speed of Calgary’s current bus-and-rail system. Transit riders will be able to get from any corner of the urban area to any other part of the urban area at speeds competitive with driving.
Such a polycentric system will serve a much higher percentage of the region’s workers and other travelers than the current monocentric system yet cost no more to operate. It will cost far less to build than a single rail line since most of the necessary infrastructure already exists. While some may worry that buses will get caught in congestion, the solution is to fix congestion for everyone, not spend billions on a slow rail system that only serves a few people in the region.
It is time for Calgary Transit to enter the 21st century. A polycentric bus system may be the best way to do it.
Randal O’Toole is a transportation policy analyst and author of Building 21st Century Transit Systems for Canadian Cities.
Christmas comes early for Calgary drivers
The Calgary Ring Road is now ready to be opened to public traffic, several months ahead of schedule.
Calgary’s ring road is one of the largest infrastructure undertakings in Calgary’s history and includes 197 new bridges and 48 interchanges. The 101-kilometre free-flowing Calgary Ring Road will open to traffic Dec. 19, completing a project decades in the making.
“Calgary’s ring road is a project that has been decades in the making and its completion is a real cause for celebration. This has been an important project and our government got it done. With this final section completed, travelling just got a little easier for families and for workers. This will not only benefit Calgarians and residents in the metro region, it will provide a boost to our economy, as goods can be transported more easily across our province.”
Although construction of the entire ring road project began in 1999 under former premier Ralph Klein, discussions on a ring road around the City of Calgary began as early as the 1950s. In the late 1970s, under former premier Peter Lougheed, high-level planning and land acquisition started and a transportation utility corridor was established to make the Calgary Ring Road a reality.
“The final section of the Calgary Ring Road is now complete, and I’d like to acknowledge the work done by former premiers and transportation ministers and their vision to build Alberta. I’m proud to announce that the final section was completed on budget and months ahead of schedule.”
“I’m thrilled to see the Calgary Ring Road project completed. It was something I have helped shepherd through the process since 2014. Finally, all the hard work put in by everyone has become a reality. The Calgary Ring Road will provide travellers with over 100 kilometres of free-flow travel, create new travel options for the City of Calgary and surrounding area and provide improved market access across the region.”
Opening the ring road means new travel options for Calgarians, which will draw traffic away from heavily travelled and congested roads such as the Deerfoot Trail, 16th Avenue, Glenmore Trail and Sarcee Trail. For commercial carriers, the ring road provides an efficient bypass route, saving time and money for the delivery and shipment of goods and services.
“The ring road investment generated thousands of local jobs and will now play an integral role in keeping Calgarians and the economy moving. This important transportation link will ease congestion on city routes and greatly improve connectivity and access for businesses transporting goods.”
The ring road is a critical component to growing economic corridors in Alberta and Western Canada, as it connects the Trans-Canada Highway to the east and west, and the Queen Elizabeth II Highway and Highway 2 to the north and south. It is also part of the CANAMEX corridor, which connects Alberta to the highway network in the United States and Mexico.
The completion of the ring road is a major boost for Calgary, opening new business opportunities and supporting key components of the Calgary economy. It sends a signal to businesses and investors that Calgary has a strong highway infrastructure, providing economic corridor connections through the entire region.
“With one of the smoothest commutes in Canada and the capacity to reach 16 million customers by road within a single day, Calgary offers unmatched quality of life and economic opportunities. The triumphant completion of the Calgary Ring Road further improves our capacity to attract even more companies, capital and talent to our city.”
“This is an exciting step forward for the Calgary Metropolitan Region. This key artery will not only improve the quality of life for the residents of the region, it is also a key economic enabler and we are thrilled to see its completion.”
Quick facts
- Stretched into a single lane, the highway is 1,304 kilometres long, the distance from Calgary to Winnipeg.
- Other sections opened in 2009, 2013, 2020 and 2023.
- The West Calgary Ring Road is the final piece of the ring road project.
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