Calgary's mayor Naheed Nenshi

Calgary Mayor Naheed Nenshi. (Photo by Norman Wong)

Canada | From Pivot Magazine

Fighting that empty feeling

Naheed Nenshi on the business of rebuilding Calgary after the bust

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Fireworks and flattering speeches marked the opening of The Bow skyscraper back in the halcyon days of 2013. It was Calgary’s tallest building, though that record didn’t last long. (Brookfield Place now reaches higher.) Then, two years later, the oil price crashed and Canada’s most ambitious city has been struggling to fill its towers—and find jobs for the people who worked in them—ever since. Jen Gerson spoke to Mayor Naheed Nenshi about how his city is trying to turn a bust into a business advantage.

From your perspective, what’s happened in Calgary since you took office in 2010?
NN:  Calgary has always been a boom-and-bust economy. And everyone always says, in every bust: “This one’s different.” This one is different. In a 23-month period we went from one of the lowest unemployment rates of any city to the highest. We went from essentially zero percent downtown vacancy to nearly 25 per cent. And part of that is because a lot of the last boom wasn’t so much an energy boom—it was actually a construction boom. And what people often forget is the amount by which the energy sector cut its capital spending is approximately the entire size of the Ontario auto manufacturing sector.

So Calgary is basically one giant futures market?
NN:  Yes, but a real one. Not a fake futures market, because it wasn’t financial derivatives trading. It was actually making bets on the future—which includes building big office towers.

With a vacancy rate that high, what kind of opportunities does that open up?
NN:  For a long time people were really priced out of downtown Calgary. You didn’t see a lot of small and medium sized businesses setting up downtown. You didn’t see a lot of businesses in new industries, just because they couldn’t afford it. So number one is finding different businesses. Number two is finding businesses of different sizes. It used to be that you could rent several floors at a time to one company. That trend is changing everywhere. Landlords have to be creative about how they can make smaller spaces work. There are, in fact, co-working spaces everywhere now. And we’re seeing different kinds of buildings get repurposed.

Now the big, big thing that needs to happen is when we look at what people call “class C” office space—the not-great older buildings. What are the opportunities there? There are opportunities to convert those into residential. Are there opportunities to use those as spaces for creative industries in the arts? Maybe it’s easier to tear down walls or create studios in older buildings. Some of them have beautiful light, for example.

cityscape of CalgaryDowntown Calgary, still a quarter empty. (Photo by IDP Canada Collection/Alamy)

Are creative industries starting to see Calgary as an opportunity?
NN: Yes, absolutely. And we need more of that. I talk a lot about our film industry and sometimes people think of film as kind of a frivolous, nice-to-have industry. It supports over 42,000 jobs in Vancouver. With the Calgary Film Centre, and with the fact we’ve got these amazing crews here in Calgary, we are responsible for more Oscar, Golden Globe and Emmy winners than any other jurisdiction in Canada.

Crazy. I thought it would be Vancouver or Toronto.
NN: We have a flight to quality. When I talk to Hollywood producers, they’re always telling me, “Look, your crews are the best in the world.” And, of course, the scenery is amazing. So, we’ve got to turn that seasonal business into a fulltime business because that’s when you get the post-production work.

Calgary’s downtown has always struggled with a reputation for being sterile and boring. Tell me about that history.
NN: The knock on Calgary’s downtown has always been that at five o’clock everybody goes home. But in fact, Calgary has one of the most successful commercial cores of any city in North America in terms of the concentration of employment. That’s why we’re feeling this vacancy rate so acutely. It’s equal to about half the rentable office space of downtown Vancouver.

So how do you try to reach out to new businesses to get them into that space?
NN: Number one is looking at entrepreneurs and homegrown businesses who need to grow into that space. Secondly, encouraging external folks to move or to expand in Calgary; saying to large Canadian companies: “Look, you’re priced out of downtown Toronto and Vancouver right now. We’ve got tons of people available, great staff and human resources and IT and all that stuff you need. Consider moving your back offices here. Because if your choice for your employees is they’ve got to go to Vaughan or Aurora…”

Tough sell.
NN: Right, it’s a tough sell. It’s a much easier sell to say come to downtown Calgary. Great restaurants, things to do after work, all right here.

So, what happened with Amazon? We had the cutest ad for Amazon.
NN: It was awesome.

Were we ever really in contention or was that just about selling Calgary to other potential businesses?
NN: Both. It really gave us an opportunity to understand what our strengths and weaknesses are. Now, was Amazon ever going to move out of the United States? Hard to say. One of the things we learned from the Amazon bid was that while we have an enormous talent base here, we’re not deep on software—software engineers and coders—and that was Amazon’s specific feedback to us. That that’s an area we have to build up. You take the moonshot, as we did, so that you can get all of the smaller shots as well.

When you were elected back in 2010, Calgary had the types of problems that all cities want to have—skyrocketing housing, lots of people moving into the city, explosive growth. Eight years later we’re in a very different situation. What’s that been like for you in terms of managing your day-to-day job?
NN: You know when I first started, my economic development work had to be about attracting labour and talent. I was spending all my time at universities convincing people to move to Calgary because there were so many jobs. And, of course, that has shifted in tone and substance now, but I still spend time at universities telling people to come to Calgary because we still continue to need that talent pipeline here. Let’s be clear. Even in the toughest times, Calgary still has the problems that other cities would love to have. It still is ranked as one of the top five cities in the world in which to live. Which, if you think about it, for a city of 1.2 million people in the middle of the frozen prairie, that’s a big deal.