A National Capital Commission official says taking a more “business-based approach” to commercial leasing has helped the Crown corporation reduce its vacancy rates.
The NCC has slightly less than 200,000 square feet of local retail space, including a large block at the intersection of Sparks and Metcalfe streets as well as a section along Sussex Drive.
In 2011, the organization’s local retail vacancy rate was about six per cent, says Bill Leonard, the NCC’s director of real estate management. That’s now dropped to 0.6 per cent as several long-empty properties are leased.
The NCC’s recent deals include popular ByWard Market bakery and cafe Le Moulin de Provence expanding by taking space at 30 Metcalfe St.
“We want doing a deal with us to be just as easy as with a private landlord,” Mr. Leonard says. “We’ve taken a business-based approach to finding new tenants.”
This includes the introduction of tenant improvement allowances as well as 48-hour turnaround times in lease offers, he says.
In addition to its retail space – which Mr. Leonard says brings in $1.5 million annually – the NCC owns a diverse portfolio of properties that includes the Pine View Golf Course, the Wakefield Mill, the prime minister’s residence at 24 Sussex Dr. and tracts of agricultural land.
Speaking at last October’s Ottawa Real Estate Forum, NCC chief executive Mark Kristmanson said the Crown corporation’s 1,600 properties “continue to enjoy historically low vacancy rates.”
The large local presence of Crown corporations such as the NCC, as well as government departments and agencies – some of which own their own properties – creates a unique dynamic in Ottawa’s commercial real estate industry.
While government tenancies provide a steady and reliable revenue stream for many private building owners, some landlords occasionally express frustration that in some cases, the government competes against them.
However, Mr. Leonard said there are differences between the properties owned by the NCC and the private sector and that the two portfolios complement each other.
“The buildings we have are of national interest … and attract a particular type of tenant,” he said.
Mr. Leonard drew upon a downtown example to illustrate how the NCC’s leasing strategy ties into the organization’s goal of animating the capital.
“Once you are done shopping at the Rideau Centre, what will make you want you to walk down Confederation Boulevard?” he asked. “Any tenant that we pick will bring people down to the area.”
In the coming months, the NCC will be looking for tenants to fill two prominent ByWard Market properties.
There will be 10,000 square feet available at 445-465 Sussex Dr., at Clarence Street, in the so-called Tin House block that’s currently being restored in a project scheduled to be completed early this year.
Nearby, a new building being constructed at 7 Clarence St. on the site of the old Memories restaurant will have 2,800 square feet of leasable space and is also scheduled to be completed this year.