A top Canadian real estate developer says the National Capital Region is poised to become a major retail distribution hub as online shopping surges and e-commerce giants such as Amazon zero in on sites that offer quick and easy access to Canada’s biggest markets.
Anthony Broccolini, the chief operating officer of the Montreal-based real estate firm that bears his family’s name, told a virtual audience Thursday night that the move away from traditional brick-and-mortar stores has shifted into high gear during the COVID-19 crisis. Many retail experts say the pandemic has fast-forwarded the e-commerce trend by at least five years.
His company and others have either built, started construction on or announced plans for nearly five million square feet of new warehouse and distribution space in the region within the past two years. Thursday night, Broccolini suggested there will be more such large-scale industrial projects to come in Ottawa.
“I think you’re going to start seeing more and more of it,” he said. “The market is changing.”
During a fireside chat with Minto Group CEO Michael Waters sponsored by the Urban Lands Institute, Broccolini said “the pendulum is swinging” toward e-commerce and its just-in-time delivery model.
It’s an opportunity for developers in Ottawa, but in other markets across North America as well.
Earlier this month, Amazon announced plans to open new distribution centres in Hamilton and Ajax. And, south of the border, Amazon said it needs 100,000 additional workers to fill positions at 100 new warehouses, package-sorting centres and other facilities it's opening this month.
But Broccolini said Ottawa has a geographic advantage, noting the capital’s location between Toronto and Montreal is a major selling point for retail distributors looking to satisfy growing demand for same-day deliveries to Canada’s largest population centres.
His family’s firm has been quick to capitalize on shifting consumer habits. The Quebec construction giant has signed deals to build several large warehouses for Amazon, both in Ottawa and the GTA.
Last year, Broccolini opened a one-million-square-foot warehouse built for the e-commerce behemoth on Boundary Road. It’s now the largest industrial building in Ottawa, but that claim to fame will soon belong to another Broccolini project – a five-storey, 2.8-million-square Amazon distribution centre in Barrhaven that’s under construction and slated for completion in 2021.
North Gower project planned
“It’s exciting, and I hope there's many more to come,” Broccolini said of the sprawling facility in the Citigate Business Park.
The company is also planning another 700,000-square-foot warehouse in North Gower, a project that’s now under review from the province’s Local Appeal Planning Tribunal after it was approved by council last December.
Meanwhile, local developer Avenue31 filed plans earlier this year to construct six office and industrial buildings totalling one million square feet on 100 acres of NCC-owned land near the corner of Hunt Club Road and Highway 417.
Founded in 1949 by homebuilder Donato Broccolini – Anthony’s grandfather – Broccolini initially made its name in Montreal before expanding into Ottawa in the mid-1990s.
Since then, the firm has spearheaded a number of high-profile commercial projects in the capital, such as the Export Development Canada building at 150 Slater St., the Alt Hotel and condo complex, also on Slater Street, and a 250,000-square-foot expansion of tech giant Ciena’s Kanata campus.
"I think people are craving to go back (to the office), but I don’t think we’re going back to the way we used to work where everyone’s in the office five days a week."
While many real estate observers fear a spike in office vacancy rates as tenants across the city reassess their need for space in the wake of COVID-19, Broccolini said he remains optimistic about the market’s long-term prospects.
Companies are rethinking their office requirements, he admits, but what form that takes remains to be seen.
“I don’t think you can build your business on a Zoom call,” he said. “I think people are craving to go back (to the office), but I don’t think we’re going back to the way we used to work where everyone’s in the office five days a week. We are social creatures – we like coming together.”
The hollowing-out of downtown real estate would have a catastrophic effect on local businesses such as restaurants and retailers that rely on office workers for a significant chunk of their sales, he added.
“I think it’s going to take time for the office sector to adjust,” he said. “For the greater good of the economy, we need people coming back into the downtown core.”
With COVID-19 infections on the rise in Ottawa, Montreal and other major cities, he said the construction industry is being forced to adapt on the fly to changing circumstances and evolving public health measures aimed at curbing the spread of the virus.
“(Construction) delays are certainly a concern,” Broccolini said. “Challenges happen every day on a job site. Like anything in life, it’s how you react. You plan for the worst, but you hope for the best.”
– With files from the Canadian and Associated Press