On June 24, 2024, Banff Town Council passed second and third reading of bylaws that eliminated minimum residential parking requirements across all housing development in the town. It was described at the time as a sweeping change and a fundamental shift, words that, in this case, were not an overstatement. For commercial real estate investors with exposure to Banff residential and mixed-use property, the implications are still being absorbed.
Why Parking Was the Bottleneck
To understand why this change matters, it helps to understand how prohibitive the old requirements were. Underground parking stalls in Banff were running approximately $70,000 each to construct. The town’s below-market housing development on the 300 block of Banff Avenue, The Aster, required 45 underground parking stalls at $69,000 each, adding $94,000 per unit in sunk cost before a single dwelling was habitable. For private developers working to residential density in a market where buildable land is essentially fixed, that cost was frequently the factor that killed a project’s feasibility.
In a town where 98.5 per cent of residential properties already contain housing, adding units requires redevelopment, demolishing or densifying existing structures, not expanding onto vacant land. The parking requirement functioned as an invisible but highly effective cap on that redevelopment. Remove it, and a significant number of projects that had been held in waiting become viable.
“In recent years, Banff had seen three net new residential units in 2023, zero in 2022, and only 34 in 2021. The parking bylaw was not the only constraint, but it was the most addressable one.”
The Commercial Property Angle
The commercial dimension of this change is subtler but significant. In Banff, commercial intensification triggers a housing obligation under the Land Use Bylaw, developers must either build staff housing or pay a cash-in-lieu contribution to the town’s Housing Reserve. As commercial properties are redeveloped or expanded, the ratio of required housing has historically been determined by the same LUB framework that governs residential density.
The elimination of parking minimums does not directly apply to commercial development in the same way, but it has a knock-on effect: as the cost of providing associated residential density falls, the economics of mixed-use commercial-residential projects improve. A ground-floor commercial building with residential above becomes more feasible when the residential component no longer requires an expensive underground structure to satisfy parking minimums.
Property Value Implications
Banff’s assessed commercial property values increased by an average of 18.1 per cent in the 2024 assessment cycle. Residential values rose 7.3 per cent on average. While the parking bylaw change was not the sole driver of those movements, the policy signal it sent, that the Town of Banff is actively committed to enabling density and redevelopment, has been absorbed by the market. Developers who had projects on hold have since come to the table with active applications.
For investors holding existing commercial property in Banff, the value uplift comes not just from higher assessed values but from the optionality that the new policy framework creates. A site that was previously limited to its existing footprint because redevelopment math didn’t work may now carry genuine development potential. That embedded optionality is a real component of value that does not always show up in a cap rate calculation.
What to Watch
The Town of Banff is targeting 240 net new housing units by January 2027 as part of its Housing Accelerator Fund commitments. The pace of permitting activity in 2025 and 2026 will indicate whether the bylaw change has had the intended catalytic effect. For commercial investors, watch the Main Street and Banff Avenue corridors for mixed-use redevelopment applications, those projects will signal where development economics have tilted in favor of action.