I had no idea that this was in the works, but it appears that the Dreman Building has been/is being converted from office to residential condos. Here is a 2000 sf unit on the market for $599K:
http://beta.realtor.ca/propertyDetails.aspx?PropertyId=14169780
Not a bad idea... this is a sliver of an office building next to a large parkade on Portage Avenue, and it has had a hard time attracting/keeping tenants for as long as I've been paying attention to it. There have been other successful residential conversions in old office buildings nearby, most notably the Lindsay Building and the Avenue Building, so this makes pretty good sense. The suite on the market is definitely more upscale than anything in those two buildings, though... it looks like it is competing head-on with the posh condos on Waterfront Drive. Of course, the big downside is that if you live there, you only have a tiny strip of windows facing north to Portage.
Slowly but surely (and quite improbably) there is a significant cluster of residential emerging along Portage between Main and Hargrave.