'No easy solution' seen as city plans forum on Calgary's hollowed out downtown core

City council plans to host an economic summit on the future of downtown Calgary in the wake of mass layoffs in the energy sector that have left vast expanses of empty office space in the core.

"We built a downtown that's really built on one industry — the oil and gas industry, said Coun. Druh Farrell, who co-sponsored the idea with Coun. Evan Woolley.

"But if the oil and gas industry is reinventing itself, if it's coming back leaner and meaner, then what does that mean for our downtown core?" she said.

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In November, real estate firm Cushman and Wakefield predicted the vacancy rate for Class-A office space in downtown Calgary would reach 27.5 per cent by the end of 2017 in the wake of mass layoffs.

"We're left with buildings that are expensive to demolish and expensive to retrofit. And so there's really no easy solution," Farrell said.

The city will work with Calgary Economic Development to organize the summit, which is expected to be held in March.

Property value assessments for office buildings dropped 16 per cent in the past year, driven largely by the growing vacancy rates.

That dip was poised to drive up property taxes outside the core, since in Calgary's system of taxation, property tax bills increase or decrease based on a how a property's assessment changes relative to the average change.

To keep that from happening, council approved a plan Monday to spend $45 million to cap at five per cent the property tax increases for some 6,000 properties and 9,000 businesses outside the downtown core.

Farrell said she hopes the March summit will bring together top thinkers to come up with strategies for the challenges facing downtown Calgary in the short and long term. 

"There's a sense of urgency here. We have to understand risk and reward, because some of the solutions may be more risky than we're used to taking," she said. 

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