The federal government’s planned disposal of Crown office properties will not focus on only one city, says the president of the Treasury Board.

Anita Anand made the comment during a conversation with Ottawa Mayor Mark Sutcliffe at the recent Mayor’s Breakfast hosted by the Ottawa Board of Trade. Increasing office vacancy in Ottawa has raised the question of whether the disposal program will be skewed towards the nation’s capital, which has a plethora of older federal office assets.

“It really is a cross-country effort,” Anand said.

Public Services and Procurement Canada will lead the disposal program.

The federal government has pledged to invest $1.1 billion in the conversion of its underused office buildings into housing. Many of the projects are slated to include affordable housing units.

Prime Minister Justin Trudeau’s Liberal government introduced the plan as part of the 2024-25 budget. The goal is to transform 50% of the federal office portfolio into 250,000 new homes by 2031.

The 10-year disposal program is expected to include sales and transfers of office properties and other assets that the government will no longer use. Many of the transactions appear likely to involve long-term leases to other parties rather than outright divestments so that the government can retain ownership without having to shoulder operating costs.

Canadian office markets have been hard hit by the effects of the COVID-19 pandemic and hybrid-work movement. During her conversation with Sutcliffe, Anand defended the federal government’s return-to-office policy, which requires civil servants to be in the office three days per week.

The policy has implications for the disposal program and future federal government investments in office real estate.

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