Adam: A smart Ottawa real-estate deal by the NCC
The National Capital Commission has bought the British High Commission building for $25 million to convert into a new headquarters and save money on rent.
As well, the NCC says, the purchase of the 60-year-old building brings one of the city’s landmarks into public ownership, in line with its mandate to secure properties of significant national interest along Confederation Boulevard. An order-in-council has already been issued for the purchase.
However, $25 million is a lot of money. Is this smart business and good for taxpayers?
The NCC, which now rents its office building at 40 Elgin St., known as the Chambers Building, pays about $3 million a year. Valerie Dufour, the NCC’s senior manager for strategic communications, says owning its own building would save the federal agency about $35 million over the first 10 years, and $3 million a year thereafter. The savings, Dufour says, would more than offset the purchase price, making it a good deal for taxpayers. The money for the purchase came from the NCC’s acquisition and disposal fund.
Architect and urban designer Barry Padolsky agrees the purchase is a good deal. When the building was put up for sale, Padolsky thought a private developer – not the NCC – would snatch it up because of its prized location.
“I am surprised they did it. We’ve come to expect bureaucratic decisions and not imagination from the NCC, but this shows some imagination,” he said. “I give them credit.”
The NCC has occupied the Chambers building since about 1994 when it signed a 25-year lease with Allied Properties. In 2013, the agency tried to move from the building, issuing a request for proposals for new premises in the city. The planned move was later abandoned. Under a deal that led to its restoration, the Chambers will return to NCC ownership in 2056 when the ground lease expires.