A new report from the Ontario BIA Association says thousands of vacant residential units are sitting unused above storefronts across Ontario, and it offers a roadmap for cities like Oshawa to convert those spaces into much-needed housing.
The white paper, called “Turning the Lights On: Unlocking Upper-Floor Housing on Ontario’s Main Streets,” was released in April 2026 with Armstrong Strategy Group. It highlights communities such as Lindsay, where 40 to 50 percent of second-floor spaces and 70 to 80 percent of third-floor spaces are empty, and St. Catharines, which may have about 200 vacant units on its historic main street.
A major barrier is the Ontario Building Code. When a property owner wants to turn a commercial second floor into an apartment, Section 3.17.2 requires full code compliance, which can cost $100,000 or more per unit. The report’s five recommendations include creating an adaptive compliance pathway for older buildings, funding a province-wide inventory of upper-floor spaces, scaling up a “head-leasing” model where supportive housing agencies manage tenants, leveraging public sector anchors like post-secondary institutions to catalyze downtown housing, and modernizing community improvement plans to cover renovation costs.
For Oshawa, the findings come at a critical time. The city must build 23,000 new homes by 2031 to meet its provincial target and had reached only 25 percent of its 2025 goal by early 2026. While Oshawa’s downtown business improvement area was disbanded in late 2020, local property owners and businesses could still benefit from the policies outlined in the report. The city has already increased density permissions downtown to 1,000 homes per hectare, and unlocking vacant upper floors could add housing without new construction.
The Ontario BIA Association plans to push for these changes at the AMO 2026 conference in Ottawa this August, where it will meet with 14 provincial ministers including those responsible for municipal affairs and housing. The full report is available at obiaa.com.
