Developer banking on office-to-hotel conversions downtown

Vancouver developer Reliance Properties is moving ahead with plans to convert two office buildings into hotels, betting that a shortage of room inventory and strong market performance will make the conversions work economically. The company recently announced plans to convert a 13-storey building at 1111 West Hastings in Vancouver into a 180-room hotel, developed with Quebec-based Germain Hotels. A second conversion—a four-storey art deco building at 780 Blanshard in Victoria—will become a 126-room property. Both are expected to open by 2029. Reliance president and CEO Jon Stovell said not every office building is suitable for conversion. "Out of 20 office buildings you might look at with that idea in mind, there might only be one or two that actually makes sense," he said. Success depends on floor plate size, ceiling heights, window configuration, and elevator layout. The buildings' locations in prime tourist areas strengthen the case. "The Vancouver and Victoria markets are the best performing hotel markets in Canada, in terms of occupancy and growth of average daily rate," Stovell said. "We might build 2,000 rooms this cycle." The Hastings building was purchased for $70 million in March 2025; the Victoria building for $14.66 million in 2019. While conversion costs could run $100 to $150 per square foot less than new construction, Stovell estimated total costs—land, existing building, and renovation—are comparable to building from scratch.