Delayed though it might be, the much-anticipated arrival of the Confederation Line is one more sign Ottawa is growing up – literally and figuratively – from a business perspective.
The $2.1-billion infrastructure project, the largest in the city’s history, was originally slated to be up and running by the middle of 2018. That deadline was extended to Nov. 2, but when the consortium building the 12.5-kilometre light-rail line, the Rideau Transit Group, said it wouldn’t be able to hand over the keys by that date, the project was delayed yet again.
It now looks like LRT will be on track to launch some time between January and March of 2019, but even that time frame isn’t a guarantee. Nonetheless, local business observers say, the train is already changing the capital’s business landscape even as we wait for it to officially arrive.
So far, the five-year project has pumped hundreds of millions of dollars into the local economy through direct employment and contracts to local suppliers and businesses serving RTG and its construction teams.
But beyond that, observers say, LRT has inspired local businesspeople to think bigger – whether it’s exploring new types of retail opportunities near the stations or proposing ambitious new mixed-use projects such as Trinity Development Group’s plan to build a soaring trio of residential and office towers near the intersection of the Trillium and Confederation lines at Bayview Station.
“It’s on the mind of every single developer and owner when it comes to either purchasing or developing assets in Ottawa."
“It’s on the mind of every single developer and owner when it comes to either purchasing or developing assets in Ottawa,” says Warren Wilkinson, managing director of the Ottawa office of real estate firm Colliers International.
He points to Trinity’s Bayview proposal and RioCan’s partnership with Halifax-based Killam Apartment REIT on a plan to eventually construct up to 840 apartment units next to the Blair LRT station as examples of major developments that likely never would have happened without light rail.
It’s a view echoed by RioCan vice-president of planning and development Stuart Craig, who has called light rail “a great catalyst” for the east-end apartment project.
“You need that central point where people are going to congregate,” Wilkinson says, referring to transit stations that are expected to draw tens of thousands of commuters every hour during peak ridership periods. “I don’t think the intensification would have happened and I don’t believe there would be the potential for it to be as successful without light rail.”
In addition, he says, the biggest employer in the National Capital Region requires most buildings it leases to be within 600 metres of a transit station.
“If you want to take advantage of the largest user of commercial office space in Ottawa, which is the federal government, you need to be near these stations,” Wilkinson says.
Plenty of hype
Other local business leaders argue the Confederation Line is pushing the boundaries of what’s possible when it comes to new commercial development.
Retail, residential and commercial intensification can all happen on a much broader scale near light rail stations because developers no longer need to devote valuable land to acres and acres of space for automobiles, says Ian Faris, CEO of the Ottawa Board of Trade.
“It makes it so much easier, because there’s no expectation of parking,” he says. “You can put a lot more in there. It not only allows (new commercial development) to happen, but it changes what’s happening and makes it more exciting, more urban.”
Wilkinson says LRT has driven new development even on properties that aren’t right next to the new Confederation Line. For example, he says, Colonnade Bridgeport’s recently completed Westboro Connection mixed-use project on McRae Avenue, which features office tenants such as Pythian as well as ground-level retail anchored by Farm Boy, is the “canary in the coal mine” signalling the pending construction of more such developments in neighbourhoods that will be serviced by stage two of the Confederation Line, which is targeted for completion in 2023.
Still, while there has been plenty of hype around light rail, some observers say it remains to be seen just how much new growth it will encourage.
Dean Karakasis, executive director of the Buildings Owners and Managers Association of Ottawa, says he thinks light rail might help fuel the continued growth of the “urban tech” scene in the central business district that’s being led by companies such as Shopify and Klipfolio, but its impact on other sectors of the economy is still an open question.
“It isn’t going to bring an influx of new companies to fill vacant space, at least in the short run,” he argues. “So, right now, I think it’s a wait-and-see.”