Canada's Office Vacancy Problem Is Coliving's Biggest Opportunity

The Setup: A Housing Crisis With a Built-In Solution

Canada has two problems that cancel each other out, if you're willing to look at them together.

Problem one: a severe shortage of affordable rental housing. Young professionals in Canadian cities are spending 50% or more of their income on rent. The benchmark for housing affordability, 30% of income, is a distant aspiration for most. And with the average age of first-time homebuyers climbing steadily, demand for quality rental housing isn't going anywhere.

Problem two: 25% of Canada's B- and C-class office buildings are currently empty. Post-COVID office vacancy hasn't recovered the way optimists hoped, and while companies returning to the office are choosing their best spaces, the older, less prestigious stock sits unused in the hearts of Canadian cities.

Robert Barnard and the Toboggan Flats team have spent the last two years building the bridge between these two problems. The solution? Office-to-coliving conversions are a model they believe can be deployed across 12 Canadian cities.

Why Co-living, Why Now

In our Everything Coliving podcast conversation, Robert laid out three converging forces that make co-living the right answer for Canada right now.

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1. The Affordability Crisis

Canada doesn't just have a housing supply problem; it has a housing type problem. The existing stock skews heavily toward condominiums (for sale) and traditional purpose-built rentals. The middle ground: flexible, furnished, community-oriented rental that works for someone making an early-career salary is almost nonexistent.

Coliving fills that gap. By sharing common infrastructure and amenities across many residents, operators can offer individual rooms at rents that hit or beat that 30% affordability threshold in locations where that's otherwise impossible.

2. The Loneliness Epidemic

Canada's loneliness crisis is real and it hits young people hardest. Robert cited this as a core driver of the Toboggan Flats thesis, and it tracks with what we're seeing globally. The COHO UK Loneliness Report found that 1 in 5 people consider themselves very lonely. Urban living is estimated to carry a 40% higher risk of depression. Well-designed co-living, with intentional community programming built into the architecture itself, is one of the few housing formats that structurally addresses this.

3. Climate Responsibility

Building conversion is, by definition, greener than new construction. You're not pouring new concrete. You're not clearing land. You're not manufacturing a new structural shell. You're taking an asset that already exists and giving it a second life. For operators and investors who care about ESG credentials, this strategy is a meaningful differentiator.

The Conversion Model: How It Works

The Toboggan Flats approach is deliberately engineered for speed and cost efficiency. Here's what that looks like in practice.

Structural Retention

The outer shell, elevators, HVAC systems, and core structure of the building are retained wherever possible. This single decision changes everything; it cuts both the timeline and capital requirement dramatically. Robert's target for a standard conversion is 9 months from permit to occupancy. In comparison, purpose-built rental takes 5–7 years from concept to keys.

Unit Mix as a Puzzle

Toboggan Flats uses three unit types; a 4-bedroom shared apartment (~210 sq ft per bedroom with kitchenette), a studio (300 sq ft with bathroom and kitchenette), and an en-suite room (bathroom only, shared kitchenette). These three types are treated like puzzle pieces, arranged to maximize floor efficiency in whatever building shape they're working with.

25% Shared Space, By Design

One of the most intentional elements of the model is the allocation of 20–25% of every floor to shared space. Toboggan Flats uses a 'room → street → neighborhood' mental model: your bedroom is your private sanctuary, the interaction zones on your floor are your street, and the whole building is your neighborhood. This cascading scale of interaction, from small phone-booth-style connection points on each floor, to medium spaces like yoga studios and game rooms, to a full community kitchen, co-working space, and gym on the ground floor, is designed to make community feel natural, not forced.

The Ottawa Case Study

The building Robert walked us through sits in Ottawa, Canada's capital and fourth-largest city, with a metro population of over one million and the second-largest student population of any Canadian downtown.

The specifics of the location are worth noting. The building is:

• Near Parliament Hill (4,000 government employees)

• Near University of Ottawa (visiting professors, TAs, graduate students)

• Adjacent to a major hospital (healthcare workers facing long commutes post-shift)

• On a transit line, with grocery retail across the street and a Live Nation entertainment venue under development nearby

With a consistent floor plate, the building will house 390 residents. Robert calls this the 'employer triangle,' pre-leasing floors with anchor institutions (the university, the hospital, and the government) before the financing round even closes. This dramatically derisks occupancy ramp-ups for investors.

The Financials

Toboggan Flats is currently pursuing an asset-heavy model acquiring buildings, converting them, and operating them. Robert was candid about the investor environment and the returns they're targeting:

• Internal rate of return: 15–20%

• Development yield: ~5%

• Stabilisation model: benchmarked against existing purpose-built rental and student housing in Canada

The pitch to investors is deliberately familiar: this is not a radical new asset class. It's purpose-built rental and student housing, combined, refined, and delivered more affordably. The key innovation is the conversion model, which lowers the cost basis enough to offer below-market rents while still delivering above-market returns. If you are interested in exploring investment, do reach out to robert@tobogganflats.com.

The Demand Is There; The Supply Isn't

One of the most consistent themes in global coliving conversations, from London to Dubai to Sydney, is that demand consistently outpaces expectations. Robert has done the research across Canadian cities, and the response from young workers is the same everywhere: how soon can you open?

Platforms like PadSplit in the US have demonstrated such results at scale in a distributed supply model. Toboggan Flats is building consolidated supply, entire converted buildings, but the underlying demand signal is the same. Properties fill up. Waiting lists form. The risk is not whether people want this. The risk is execution.

What This Means for the Coliving Industry

Canada has been conspicuously absent from the global co-living conversation. While operators scaled across Asia, Europe, the US, and increasingly the Middle East and Australia, Canada remained a white space. Toboggan Flats is the beginning of a change in that.

What makes this model particularly intriguing from an industry perspective is its replicability. Office vacancy is a North American-wide phenomenon. The conversion-to-co-living playbook, once proven in Ottawa, is immediately applicable in Toronto, Calgary, Vancouver, and beyond. Robert mentioned buildings already in the pipeline assessment in Toronto and Calgary.

If Toboggan Flats delivers on its Ottawa proof-of-concept, it won't just be a successful coliving operation. It'll be the template that opens the Canadian market.