Selling federal office buildings should move twice as fast, says official

The man in charge of tens of millions of square feet of federal office space is aiming to double the government's lumbering pace for off-loading buildings.

Mark Quinlan, assistant deputy minister of real property services at Public Services and Procurement Canada (PSPC), said the department has a "special group" in place to speed up property disposals. 

"Historically, the government is not very good at disposing of surplus properties," he told a city building summit organized by the Ottawa Board of Trade Tuesday.

Policies require PSPC to consult with provinces, municipalities, other departments and Indigenous partners before putting a property up for sale.

"That process takes a lot of time and it was never the priority for most departments," he said. "On average it takes nine years to dispose of a government building. We want to split that, minimally, in half."

Quinlan acknowledged that four to five years might still seem long, but he said the government is looking at ways to make exceptions to its policies and "direct" sales on an accelerated basis.

Fewer, fuller buildings mean more foot traffic

Currently, PSPC has a disposal list of 10 surplus office properties it's looking to unload in the Ottawa-Gatineau area.

None of those properties are currently listed for sale and politicians and developers have criticized the slow pace amid a housing crisis.

The 2024 budget set a 10-year target of cutting PSPC's office portfolio in half. Right now, the department is still developing a long-term real estate plan with a master list of surplus properties.

Disposal is only part of the process, since much of the government's office space is leased. About half of those leases will expire in the next five years.

Quinlan said federal real estate planning is based on three days a week in the office for public servants, with the move to unassigned desks allowing an even more efficient use of space.

In his view, concentrating workers in fewer buildings — with a goal of filling them beyond 80 per cent capacity — will mean a more vibrant downtown, especially if all those surplus buildings become housing.

"The office spaces we're going to stay in will have a much higher rate of use," he said. "So that foot traffic in and around government offices is going to be a lot higher than it ever has been."

Speeding up new housing on federal lands

Canada Lands Company is taking a close look at those PSPC properties to see which ones could become housing, according to president and CEO Stéphan Déry. 

The Crown corporation, which buys, manages and develops federal properties, is planning to bring thousands of homes to the Ottawa area through several ongoing projects from Tunney's Pasture to Confederation Heights.

Déry, who also spoke at the summit, said this month's federal budget gave Canada Lands new powers that should allow it to build more homes faster, including in Ottawa.

That includes leasing out properties to "not-for-profits in order to help them," said Déry, instead of selling them to developers.

"We'll lease the land for nominal value, so basically a dollar, for 50 years, 100 years, so they can start building affordable housing on these lands."

Canada Lands is planning to do precisely that to bring 500 more homes to the Wateridge Village development on a former air force base near the aviation museum.

The corporation will also now have the ability to build on active but underused federal sites — something Déry said will be a major advantage in speeding up work on the Confederation Heights project south of Carleton University.

"Maybe we can start building faster and not wait for the whole thing to be vacated for us to build," he said.

While the federal government has typically sold properties to Canada Lands at market rates, it is now looking to transfer it for $1 whenever possible to support affordable housing. 

Déry said Canada Lands is looking to exceed 20 per cent affordable housing in its projects and the $1 policy will make that far more financially viable.