The Department of National Defence has purchased two Ottawa properties, including an office building and industrial facility, amid a spending push and real estate crunch.
DND previously leased the facilities located at 1600 and 1630 Star Top Rd. in Ottawa’s east-end industrial park, but decided its “needs would be best served through direct ownership of the properties,” according to spokesperson Andrée-Anne Poulin.
The purchase, which closed on April 1 and was first reported by the Ottawa Business Journal, is a response to “evolving long-term requirements” at DND, Poulin said in an email.
“The facilities will continue to support longer term DND and Canadian Armed Forces operational requirements in the National Capital Region.”
DND paid $59 million for the properties. The former owner, Ottawa property management company Arnon Corp., didn’t immediately respond to a request for comment.
DND purchased two properties it previously leased on Star Top Rd.
The shift from leasing to owning the properties comes as DND’s headcount grew by nearly 3,000 employees over the last fiscal year (though the Canadian Coast Guard moved under the department’s purview).
While much of the federal public service is shrinking, DND is one of the few areas experiencing growth, as Canada strives to meet a NATO pledge to spend five per cent of annual GDP on defence by 2035.
DND was one of several large federal departments unable to fully meet Treasury Board’s four-day return-to-office directive for most public servants by the July 6 deadline.
In a May 22 memo, the department’s top civilian official, Christiane Fox, said “space constraints” and the recognition of anticipated growth have led the department to “stagger” its four-day return-to-office plans.
A long-standing parking shortage at DND’s Carling Campus reached a boiling point this spring, after military police towed 13 cars belonging to government workers.
DND has since examined whether it should turn nearby sports fields into parking lots as a temporary solution.
Elsewhere in the public service, the return-to-office push has forced Public Services and Procurement Canada (PSPC) into “adjusting” its previous effort to trim the federal office portfolio by half over the course of a decade.
PSPC, the government’s central property manager, has entered into 16 leases in Ottawa-Gatineau since Treasury Board announced the updated hybrid work rules in February.
In an email, spokesperson Michèle LaRose said those leases can mean a “renewal, relocation or optimization” of the real estate portfolio and do not “necessarily mean a net increase in occupied space.”
The department, however, refused to answer questions from the Ottawa Citizen about the nature of the leases and the net change in PSPC’s office portfolio since February.
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