The storm brewing on Stephen Avenue has escalated beyond frustrated conversations among shop owners. After months of construction delays and what merchants describe as devastating financial impacts, a group of Stephen Avenue business owners are now seriously considering legal action against the City of Calgary.
I’ve walked Stephen Avenue almost daily for the past five years. What was once a bustling pedestrian mall has transformed into a maze of construction barriers, reduced foot traffic, and increasingly vacant storefronts. The situation has reached a breaking point for many local entrepreneurs.
“We’ve lost approximately 40% of our revenue since construction began,” says Maria Oliveira, who has operated her family-owned restaurant on Stephen Avenue for over 15 years. “The city promised minimal disruption, but we’ve had jackhammers outside our patio all summer. Customers simply stopped coming.”
The $53 million Stephen Avenue revitalization project, which began in early 2023, was initially welcomed by many business owners who understood the need for infrastructure updates. However, according to at least a dozen merchants I’ve spoken with, communication from the city has been inconsistent, timelines have repeatedly shifted, and promised mitigation measures never materialized.
Calgary law firm Thompson & Associates has confirmed they’re consulting with a collective of approximately 18 Stephen Avenue businesses about potential legal options. While no lawsuit has been officially filed, sources close to the matter suggest formal action could come within weeks.
At the heart of the dispute is the question of reasonable compensation. Many jurisdictions provide financial support to businesses severely impacted by public infrastructure projects. Calgary’s approach has been criticized as inadequate by affected businesses.
“We understand the need for improvement,” says James Chen, who has operated his retail shop near 2nd Street for nearly a decade. “But when construction drags on months longer than promised and your revenue drops by half, there needs to be accountability.”
The City of Calgary maintains that the revitalization will ultimately benefit all businesses along the historic avenue. In a statement, they noted: “We recognize construction periods are challenging for local businesses. Our teams work diligently to minimize disruptions while creating a world-class pedestrian experience that will drive increased foot traffic and economic activity upon completion.”
City representatives pointed to their business support program, which includes promotional campaigns and improved signage. However, several business owners dismissed these efforts as “window dressing” that fails to address the real financial harm they’re experiencing.
What makes this situation particularly challenging is the timing. Many Stephen Avenue businesses were still recovering from pandemic-related losses when construction began. The combined impact has proven too much for some establishments.
Just last month, three longstanding businesses announced permanent closures, citing construction impacts as the final blow. The avenue’s vacancy rate has climbed to approximately 28% according to recent commercial real estate data – significantly higher than Calgary’s downtown average.
Council members appear divided on the issue. While some have publicly acknowledged the severity of business impacts, others maintain that short-term pain is necessary for long-term gain. Councillor Terry Wong, whose ward includes portions of downtown, has called for a review of the city’s business support mechanisms during major infrastructure projects.
The situation raises important questions about municipal responsibility during public improvement projects. Calgary’s downtown has faced numerous challenges in recent years, from office vacancy issues to shifting work patterns. Stephen Avenue’s revitalization was meant to be part of the solution, not create additional problems.
Looking beyond the potential lawsuit, there are lessons to be learned about communication, realistic timelines, and meaningful support for affected businesses. Other major Canadian cities have implemented more robust compensation programs that Calgary might consider adopting.
From my perspective, having covered numerous city development projects, the breakdown in trust between merchants and city administration could have lasting consequences for future downtown initiatives. Rebuilding that trust will require more than completed construction – it will demand real acknowledgment of the hardships businesses have endured.
As this story develops, I’ll continue speaking with affected business owners and city officials. For many Stephen Avenue merchants, this potential lawsuit represents more than financial compensation – it’s about recognition that their livelihoods matter in Calgary’s broader downtown vision.
Whether through legal channels or negotiated solutions, the path forward must balance the city’s development needs with meaningful support for the small businesses that give Stephen Avenue its distinctive character.
