Call it a rental boom. A new report shows that Calgary’s commercial real estate sector is driven by demand for housing, resulting in unprecedented purpose-built rental development in the city. “We’re seeing more multi-family purpose-built rentals constructed than apartment condominiums,” says Darryl Terrio, broker with Re/Max Complete Realty in Calgary.
The Re/Max 2024 Commercial Real Estate Report notes purpose-built rental development starts overtook condominium starts for the first time in 2023. Driving that growth has been record migration to the city leading to Canada Mortgage and Housing Corp. reporting that rental vacancy was 1.
4 per cent in the fall of last year. “The influx of interprovincial migration and immigrants is challenging the city’s housing stock, with vacancy rates at the lowest level in a decade,” the report notes. That led to “more than 3,000 new units” in the city in 2023 “in the Beltline, downtown and the North Hill areas.
” Terrio adds that recent changes to zoning bylaws in the city, allowing for higher density housing in typically single-family detached home neighbourhoods, have spurred a boom in small-scale multi-family projects. “It’s just so much more affordable and feasible now to build multi-family rental,” he says. A factor in that is CMHC’s MLI Select program allowing builders to get financing with only a five per cent down payment providing the new build, or renovation on an existing building, meet certain afford.