Costco’s traditional model — big warehouse footprint, strong memberships, and everyday value — just got a serious real-estate upgrade. Developers are now stacking apartment housing directly on top of Costco warehouses, creating mixed-use communities that tackle both the housing crunch and retail demand. What started with a bold project in South Los Angeles could be the blueprint for cities across North America.
What’s the Costco Housing Model?
In Los Angeles, a developer called Thrive Living is building the first Costco Warehouse with 800 rental apartment units above it. About 184 units will be set aside for low-income households, while the remaining units are marketed as affordable or workforce housing. The ground level stays retail — Costco — with the apartments above, surrounded by amenities like underground parking, rooftop recreation, and fitness spaces.
This isn’t a tiny pilot. It’s a fully integrated mixed-use property that blends everyday needs with residential life and jobs, and it’s privately financed without low-income tax credits.
Why This Matters
- Maximizes Land Value and Utility
Big-box retail footprints are huge, often miles from dense urban nodes. Putting housing above retail uses land far more efficiently than stand-alone warehouses or single-use housing projects. That’s a huge advantage in cities with limited developable land. - Convenience Drives Quality of Life
Residents literally live steps from everyday essentials — groceries, pharmacy, optical, and lifestyle goods — reducing car dependency and creating walkable, mixed-use neighborhoods. - Housing Supply + Retail Foot Traffic Synergy
Retail anchored by daily needs benefits from built-in foot traffic, while housing benefits from proximity to jobs and services. That’s a win-win in CRE economics. - Potential to Lower Overall Costs
Shared infrastructure (foundation, parking, utilities), combined approvals, and possibly modular construction can tip the economics in favour of more affordable development — especially versus traditional housing builds that struggle with land and compliance costs.
How This Could Benefit Calgary
Calgary is expanding rapidly, and affordable housing continues to be a key issue in the city’s growth story. Here’s how a Costco-style model could work here:
- Density + Accessibility: Calgary’s urban areas and transit corridors are prime spots for mixed-use. If a Costco apartment project were near transit or major job centres, it could not only add housing units but also connect residents directly to services and work without car reliance.
- Boost to Workforce Housing: Calgary’s workforce — from service workers to early-career professionals — often gets squeezed by rising rents. A model that locks in units at affordable or workforce rates would diversify the housing stock without requiring heavy subsidy.
- Economic Anchor + Job Creation: A project like this doesn’t just deliver homes — it creates jobs (retail + construction) and stabilizes retail income, which is attractive to investors and municipalities alike.
- Supports Urban Planning Goals: Calgary planners already talk about densification and mixed-use nodes in areas like Beltline, East Village, or transit-oriented zones. Adding a model that integrates retail with housing fits that vision, reduces sprawl, and keeps infrastructure more efficient.
Why Experts in Mixed-Use Leasing Should Pay Attention
As specialists in mixed-use leasing, we live where retail intersects with residential — and the Costco concept pushes that boundary:
- It validates anchor retail as a housing catalyst, not just a traffic generator.
- It creates new revenue streams — retail lease income paired with residential rent — improving investment appeal.
- It forces better community integration — shared spaces, shared infrastructure, and a market-driven approach to affordable housing.
Calgary is ready for creative approaches that increase housing supply, improve quality of life, and retain strong retail economics. Costco’s mixed-use housing model may not be the silver bullet, but it’s a serious template worth studying.
Relevant Information Reviewed From:
Globe and Mail
Entrepreneur
Housing Finance
