Ottawa commercial landlords bid welcome

Ottawa commercial landlords bid welcome

Canadian government sets return-to-office policy across all departments
Friday, December 16, 2022
By Barbara Carss

Many Ottawa commercial landlords and their retail tenants can look forward to busier buildings as the Canadian government’s newly announced common hybrid workplace policy unfolds across all federal departments this winter. Mona Fortier, President of the Treasury Board of Canada, confirmed yesterday that public service employees will be expected to spend 40 to 60 per cent of their working hours in a formal office setting by no later than March 31, 2023.

“We need consistency in how hybrid work is applied across the federal government,” she said. “This will support our purpose: serving Canadians.”

That’s generated some pushback from the Professional Institute of the Public Service of Canada (PIPSC), which had called for government departments to separately develop their own plans in consultation with public sector unions. However, core health and safety measures aligned with industry specifications, such as ASHRAE and GBAC, have long been in place in host office buildings.

Dean Karakasis, executive director of the Building Owners and Managers Association (BOMA) of Ottawa lists a slate of protocols related to air circulation and filtration, cleaning, signage and public education that members have adopted. He maintains landlords can provide informed support to government facilities managers as they identify staff needs and space configuration requirements, drawing partly on the experience developed from working with private sector tenants.

It’s estimated that 70 to 75 per cent of the city’s private employers again have staff in their offices on a regular basis, typically making for about 55 per cent attendance on any given day in the space they occupy. In contrast, government tenanted space has often been at less than 20 per cent occupancy.

“Our members have been ready for the whole year, and there have been a few false starts (from government) where they geared up and then it didn’t really happen,” Karakasis recounts. “It’s de rigueur these days. Everybody’s going hybrid, but everybody defines it differently. So whatever the various government departments need from their landlords — whether it’s adjustments to the office space; whether it’s technology infrastructure — those are things they’re ready to address as people come back.”

The Office of the Chief Human Resources Office (OCHRO), a division within the Treasury Board secretariat, has been tasked with coordinating the return. Fortier characterized it as a shift “from remote-by-necessity to hybrid-by-design” and enunciated the government’s position on the importance of staff interaction in the office.

“In-person work better supports collaboration, team spirit, innovation and culture of belonging. It helps teams build trust and learn from each other,” she asserted. “We’re not going back to the way things used to be. We’re reimagining our workplace.”

In turn, business operators and civic boosters are optimistic that will help to reinvigorate downtown Ottawa. While private sector return-to-work patterns have noticeably increased activity from Tuesdays to Thursdays, the city’s largest single employer and tenant has been a modest contributor to that dynamic thus far.

“Retailers have been the tenants that have been hurt the most in terms of not having that downtown vibrancy, especially through the nice weather months when office workers go outside, and they shop or go to the restaurants,” Karakasis notes.

In the bigger market picture, the federal announcement is further evidence of the growing entrenchment of hybrid workplaces and perhaps a harbinger of continued, albeit evolving leasing activity, which building owners and prospective investors have been awaiting. Speaking during the recent online presentation of CBRE Canada’s annual lenders’ report, Peter Senst, the firm’s president of capital markets, reiterated that many tenants have been in a holding pattern throughout the pandemic period.

“2023 is going to be the year where decisions have to be made. The CEO can’t keep kicking the can down the road,” he mused. “You’re going to find them, and you’re going to find Canadian governments, all starting to make calls going into next year. We’ll see what that looks like.”

Barbara Carss is editor-in-chief of Canadian Property Management.

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