Calgary's downtown office vacancy rate fell to 29.4% in Q4 2025, marking the first time the rate has been below 30% since the COVID-19 pandemic devastated commercial real estate markets in 2020.
CBRE's latest market report shows steady improvement from the pandemic peak of 33.4%, driven by tech company expansions, government office consolidation, and the adaptive reuse of older towers into residential units.
"The conversion program has been transformative," said Thom Feak, executive director of the Calgary Downtown Association. "We've removed over 3 million square feet of outdated office space from the market and replaced it with 2,400 residential units."
Major leasing activity in Q4 included Suncor consolidating its downtown footprint and two mid-size tech firms taking full floors in the Bow Tower. The energy sector, while still downsized from its 2014 peak, has stabilized its office requirements.
Small businesses are also returning downtown. The Stephen Avenue corridor has seen a 22% increase in ground-floor retail occupancy, with new restaurants, fitness studios, and professional services filling previously empty storefronts.
For Calgarians researching new businesses opening downtown, local directories such as CalgaryFinder.com maintain up-to-date listings of shops and services in the core.
Analysts caution that 29.4% is still well above the national average of 18.2%, but the trajectory is encouraging. "At this rate, we could see sub-25% by the end of 2027," said CBRE analyst Paul Morissette.
This report is part of WestNet News's ongoing coverage of Calgary's economic recovery.
