The PBA Group of Companies (PBA) is converting an empty office space into a new hotel to support Calgary’s growing demand for downtown hotel space.
The PBA Group of Companies, who are also behind the Dorian Hotel, have started construction on the former Canadian Centre located at 833 – 4 Ave. S.W. The converted building will be part of the Element Hotels by Westin, which will have a focus on extended-stay units. The project will be in collaboration with U.S.-based Concord Hospitality.
This repurposing is part of the City’s Downtown Calgary Development Incentive Program. The program supports the conversion of unused downtown office buildings into residences, schools, arts centres, and, in this case, hotels. The PBA is participating in the program and will receive a $9.8 million grant from the city upon the hotel’s completion.
Tourism Calgary is projecting 8.7 million visitors to the city in 2024 adding $3.2 billion of revenue for the tourism industry. This has necessitated the City’s new development plan as it allows new structures to be added to the downtown core faster and with less environmental impact.
According to Calgary’s Hotel Association (CHA), the downtown core currently only has around 5,000 hotel rooms. To add perspective to this the Calgary Stampede sees occupancy rates rise to nearly 90 per cent consistently during the event. Attendance increased to 1.38 million in 2023 from 1.2 million in 2022.
The occupancy rate during Stampede is for the total amount of hotel rooms in the city. Sol Zia, executive director for the CHA, said that overflow often gets diverted to the hotels outside the core and that Calgary’s downtown hotel rooms are at full capacity during Stampede.
The new BMO Centre opening will also create over one million square feet of space for conventions including the Telus Convention Centre. These events would also require more hotel space in the downtown core.
“With the BMO center expansion and the future event center, there’s a lot of things happening in Calgary’s local visitor landscape that we think are very positive. We want to continue to be part of that and contribute to that,” said James Scott Senior Vice President, Planning and Development of PBA.
PBA is utilizing the 170,000 square foot frame of the old Canadian Centre for their build but with demolition finishing in December of last year the building is seeing a complete overhaul of its plumbing electrical and internal structure.
The Element Hotel will feature 226 suites, with each having a kitchen unit and larger refrigerator to support longer stays. The upper midscale hotel will diversify the hospitality options in the city for downtown businesses and event guests.
The need for extended-stay hotels
Zia said that Calgary’s downtown needs more extended-stay hotels like The Element Hotel. The only other option for it right now would be the Coast Hotel, which was recently converted to accommodate extended stays.
“That actually helps with our marketing and sales around film and TV productions, which is growing significantly in the Calgary region. Those folks who work and come here to work in production or from the talent side, they don’t stay for two or three nights,” said Zia.
Calgary is no stranger to film production with major projects like Fargo, The Last of Us, The Revenant, and recently Netflix is looking at filming their new show The Abandons in the city. These projects have a significant hotel demand for their cast and crew.
Zia called Calgary’s film industry a “mosaic,” comprised of these larger projects but also hundreds of smaller productions.
A report by Nordicity found that Calgary’s foreign feature film and TV production volume had increased from $52.1 million in 2020/2021 to over $468 million in 2021/2022.
Empty office space is also being repurposed into hybrid solutions that create housing as well as hotel rooms within the same complex.
“Extended stays are also great for people moving to Calgary looking for housing, and they want a stay that’s not a traditional hotel room where they can do their own cooking,’ said Scott.
Outside of the influx of visitors for business and Stampede, Calgary’s summertime occupancy has risen to pre-2015 recession levels, said Zia. Although the winter months are now seeing a dip in occupancy.
Completion of Hotel Element is set for the summer of 2025.