A hotel project at the Ottawa International Airport that became embroiled in controversy earlier this year when the developer’s bid for a municipal tax break was rejected is going ahead.
Group Germain plans to start laying the groundwork next week for a 178-room Alt Hotel that will be attached to the airport terminal, the company’s vice-president of operations, Hugo Germain, told OBJ on Thursday afternoon.
Germain said the project, which has an estimated price tag of about $55 million, is expected to take 18 to 20 months to complete.
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“The goal is to be open in 2025,” Germain said. “We’re pretty excited about it.”
Ottawa International Airport Authority president and CEO Mark Laroche said the new lodging will put the city on equal footing with other major Canadian centres such as Toronto, Montreal, Vancouver and Calgary that already have terminal hotels.
“We see it as an important element of supporting our vision of becoming a hub airport,” Laroche said.
“People are asking for a hotel that is directly connected to the terminal. We identified this as a priority many years ago, and it’s nice to see ground breaking soon on this.”
The new hotel will be a scaled-back version of the original proposal, which was slated to be an eight-storey building with 180 rooms.
The revised plan calls for seven storeys and two fewer rooms. Some amenities such as meeting areas and mechanical infrastructure have been relocated from the top floor to other parts of the building to make better use of space, Germain said.
The total footprint will be about eight per cent smaller than the original plan, he explained.
Germain said the company worked with its contractors, including Ottawa-based Thomas Fuller Construction, to find efficiencies as costs escalated from the pre-pandemic estimate of $44 million.
He said that while the current $55-million figure remains a “moving target,” he is confident the final price tag will be close to that amount.
“The pricing pressure is a bit lower, so that’s a good sign, but it’s still a very expensive project,” he said.
Besides two large meeting rooms, the hotel will also feature a gym as well as a full-service bar and restaurant on the ground floor. Germain said guests should be able to get to airport gates via a fully enclosed walkway in less than 10 minutes.
“If they’re going down south, they can wear flip-flops if they want,” he added.
The much-anticipated project appeared to be in jeopardy earlier this spring when Ottawa city council rejected a proposal that would have seen Group Germain receive a $3.7-million tax break over 10 years as an incentive to build the hotel.
The company was the first applicant under a new community improvement plan approved by the previous council in July 2022 aimed at spurring new development in the airport district.
Supporters of the tax break, including Laroche, said it was necessary to ensure the project went ahead. Germain told the finance and corporate services committee last April that the company’s lenders were factoring the projected savings into their financing calculations.
Many local business leaders are also keen supporters of the project.
Ottawa Board of Trade president and CEO Sueling Ching told OBJ in May the project is a “critical part” of the airport’s recovery plan, arguing it will make Ottawa International Airport a more attractive destination for airlines looking to add flights to the capital.
She said that while other major Canadian cities have offered cash incentives for air carriers to establish new routes to their communities, Ottawa chose not to do so, opting to set up the tax-break program for the airport area instead.
“We’re not trying to take a slice of the pie from the other hotels (near the airport) – we’re trying to create a bigger pie for everyone,” Ching said. “This is an opportunity that fits in with the long-term growth plan for the airport authority. From that perspective, I think it’s critically important.”
However, a majority of councillors, including Mayor Mark Sutcliffe, voted against the proposal. Some contended it amounted to a taxpayer subsidy of a private business, while others questioned the need for another hotel at the airport.
On Thursday, Sutcliffe said he’s pleased that Group Germain is moving ahead with the hotel, adding it should help drive more passenger traffic to the airport and might prompt airlines to consider adding more flights to the capital.
“I think it will be great for the airport, great for visitors to Ottawa and great for the economy,” he said. “I’m glad that the airport and the Germain group were able to work out a good plan that is feasible for them.”
The hotel will be Group Germain’s third property in Ottawa and the third airport lodging for the chain, which also operates terminal hotels at Toronto’s Pearson International Airport and Halifax Stanfield International Airport.
“The city has always been very welcoming to us,” Germain said. “Terminal hotels in general are good-performing hotels. It’s a good business opportunity. If we have opportunities to be at a terminal, we try to go for it.”