Dream Office REIT Secures Grant To Convert 16-Storey Office Tower In Calgary

Dream Office REIT of Toronto has secured an $11 million grant from the City of Calgary to convert a 16-storey office tower at 606 4th Street SW into residential rental units. The funding comes from the city's Downtown Development Strategy Incentive Program, which supports office-to-residential conversions. With this grant in place, the building, which was once considered a core office property, is now set to begin its transformation into housing.

The building, known as 606-Fourth, was originally built in 1969 and last renovated in 2017. It currently has around 126,000 square feet of space and is about 83 percent leased. There are 11 tenants in the building, including Canadian Western Bank, and most leases have about two years left. Dream Office owns the tower along with a nearby three-level parking structure, and it's one of three downtown buildings the company owns in Calgary.

Starting in late 2024 or early 2025, Dream plans to turn the tower into a 166-unit rental property. The company has said this change is part of a broader plan to reduce reliance on office space and unlock more value from its properties. Office tenants will be moved to another building the company owns nearby, which will help fill vacancies in that location while clearing out 606-Fourth for redevelopment.

Dream Office also secured development financing in March 2025. The loan offers up to $64.3 million at a low interest rate tied to government bond rates. This funding will support the building’s full conversion and help manage financial risks throughout the process. The credit facility is not revolving, and its interest rate will be fixed when the company starts using the funds.

A construction manager is expected to be named soon, after a competitive bidding process. Dream is also exploring a joint venture partnership to help carry out the project and reduce financial risk. In the meantime, 606-Fourth has been reclassified as a development property, which slightly reduces the company’s overall reported occupancy rate.

The project is part of Calgary’s broader effort to breathe new life into underused office buildings. Since 2021, the city has backed multiple conversions to turn empty office space into much-needed housing. With funding incentives and flexible planning support, Calgary is trying to bring more residents into its downtown. Dream Office’s conversion stands out as one of the largest and most ambitious projects so far under this initiative.