Broccolini to spend up to $200M on massive new distribution centre in southeast Ottawa

Distribution centre
(Stock image, for illustrative purposes only)

A Montreal-based developer is planning to construct the largest distribution centre in the National Capital Region, a massive 1.02-million-square-foot facility that experts say could kick off a new wave of development in southeast Ottawa.

Broccolini has filed a site plan application to build the warehouse, which will have 100 truck loading bays and ceiling heights of between 36 and 38 feet, at the interchange of Highway 417 and Boundary Road.

James Beach, Broccolini’s director of real estate and development, said the company does not currently have a tenant secured for the space.

“Ottawa is a good market, (with) low industrial vacancy rates,” Beach said. “This investment in Ottawa is consistent with the increasing demand for large facilities of this nature that we’ve seen in the GTA and Montreal area.”

While Broccolini has previously developed properties prior to securing a tenant, Beach said the firm would prefer to have a commitment in place before it breaks ground on this particular project.

Beach said the massive new distribution centre is being designed with “a potential use in mind” but that it could be converted into a multi-tenanted facility.

The new structure would be constructed on a 96-acre parcel of land on the east side of Boundary Road, just south of GreyHawk Golf Club. Beach estimated the project costs at between $100 and $200 a square foot, depending on the end user’s requirements, bringing the total cost to up to $200 million.

Documents filed by consultants in support of the development application project the facility to employ more than 1,000 workers on daytime and evening shifts.

Beach confirmed the facility will have the capacity to accommodate 1,000 staff, but said the transportation study assumed the “peak number” for design requirements and said there could be fewer employees working out of the facility.

Broccolini is known locally for constructing the Export Development Canada tower with Canderel in downtown Ottawa as well as the recently completed Ciena campus in Kanata. The firm is also the developer, owner and landlord behind 199 Slater St., a mixed-use 21-storey downtown tower featuring condos and an Alt Hotel.

While the firm performs work as a third-party general contractor, Beach said Broccolini has been focusing extensively over the past decade on its own developments, building and managing real estate across various asset classes in Montreal, Toronto and Ottawa.

For the Boundary Road project, Beach said Broccolini would own, develop and manage the warehouse as a landlord.

Ottawa industrial market

By some measurements, the availability of industrial space in Ottawa is approaching record lows.

The market’s availability rate – the amount of available space, whether vacant or not, divided by the total amount of existing inventory – declined by half a percentage point in the first quarter of the year, from 3.7 per cent to 3.2 per cent, according to real estate services firm Colliers International.

“This could be the catalyst for a new wave of development."

If a single user leases all of Broccolini’s new facility, the building won’t have any impact on the local vacancy rate.

However, it could spur additional development in the southeast corner of the nation’s capital, said Warren Wilkinson, the managing director of Colliers International in Ottawa.

“This could be the catalyst for a new wave of development in the area,” he said, adding that the existing zoning and size of other land parcels in the area would influence future growth.

“If people see a large user out there, it will start drawing amenities. It will start drawing other attributes to the area, which could in turn trigger smaller parcels being built upon (and) business parks being developed.”