Ottawa’s Office Conversions Aim to Tackle Housing and Climate, But Challenges Loom

This is a reprint of an article published May 9, 2024 by The Energy Mix, an Ottawa-based community news site and e-digest on climate change, energy, and the shift off carbon (see original post here). It is reprinted here with the permission of the organization. You can read more articles by The Energy Mix, and sign up for their newsletter, by following this link.

The rising trend of converting Ottawa’s underused office buildings to apartments could aid the city with its housing and climate goals, say experts, but only if both energy efficiency and affordability are prioritized—a delicate balance in this type of renovation.

Without question, repurposing any existing building saves embodied carbon—the total emissions from construction materials, machines, and transportation—needed for a brand new housing development.

In the case of CLV Group’s second office-to-residential conversion, the 11-storey former Narono building in downtown Ottawa, the plan is to preserve the “vast majority of the building’s exterior,” CLV President Oz Drewniak told the Ottawa Business Journal last summer.

“The project is set to save over 550 truckloads of concrete and will benefit from a significant reduction in greenhouse gas emissions compared to a similar-sized development built from the ground up,” the company says. “Converting the building instead of tearing it down also allows CLV Group to recycle existing materials rather than sending them to the landfill.”

Any of those items “that can be repurposed or re-used will be donated to various local charities and trade schools.”

But some uncertainty remains about the long-term emissions reduction potential of such conversions, because the mid-to high-rises most likely to be contenders for conversion tend to be high-emitting, pre-1990 buildings, where a retrofit sufficient to meet a low- or zero-emission standard would be “very expensive”, EnviroCentre Executive Director, Sharon Coward told The Energy Mix.

Yet the climate payoff would be high: A study in New York City found that zoning changes to expand eligibility for conversions could see the city’s concrete jungle reduce whole-life carbon emissions—emissions of its entire life cycle of construction, operation, maintenance, and demolition—by as much as 54% from business-as-usual by 2050. It would also mean around 20,000 more homes on the NYC market by 2030.

Commercial green building specialist James McNeil told The Mix that reducing whole-life carbon must be prioritized in all of Ottawa’s conversions. Developers “would be crazy” not to seize the opportunity, he said, adding that “the decisions we make today about our buildings will have an impact for the next 50 years.”

McNeil asked: “Why would anybody frankly in their right mind invest in an obsolete building?”

With only around 11 buildings currently identified as eligible for conversion in downtown Ottawa, office conversions are not the “silver bullet” for the city’s climate goals and housing woes, McNeil added. But “every little bit helps,” so it’s crucial “to build our buildings right.”

That’s the hope for the other upcoming conversions in the area: District Realty’s plan to add 177 residential units at the Elgar building at 200 Elgin St., Gatineau-based Katasa Group’s conversion of a 13-storey structure that was only 35% occupied last fall, and Devore Group’s plans for the 230,000 square-foot former Telesat headquarters in Gloucester.

Living Downtown Must Be Affordable

Next comes the question of policy that aligns efficiency and affordability. “It might be that higher-priced units in net-zero or low-emissions converted buildings have a great market, and over time, replication of these types of conversions might reasonably drive down the costs,” in which case “enforcing efficiency retrofit requirements would be a great idea for climate and housing,” Coward said.

On the other hand, strict retrofit requirements could deter developers, she added, which would leave “a pile of high-emitting, empty buildings in our downtown cores.”

CLV’s Drewniak made a similar point in his interview with OBJ, warning that retrofitting office buildings into homes does not come cheap and remains a “risky” business. He welcomed Ottawa City council’s pilot to reduce parkland fees on office-to-residential conversions as a good first step, but said much more support was needed from governments.

“A 2% reduction in parkland (fees), although it’s helpful, it’s not the meaningful offset that these conversions really need.”

The Canadian Urban Institute (CUI), which produced an in-depth guide to office-to-residential conversions last spring and an update in March, says public funding support for conversions led by private developers can provide a path to affordable housing.

“Although not all underutilized or empty commercial buildings can be converted, many can,” Jennifer Barrett, CUI’s managing director for programs, planning and policy, wrote in an email. “To ensure units are affordable, however, will always require a public investment to keep units below market rate.”

Public Dollars for Non-Profit Housing

Kaite Burkholder Harris, director of the Alliance to End Homelessness Ottawa, told The Mix that non-profits, not private developers, are more suited to that task.

“Private developers just can’t turn office buildings into deeply affordable housing,” Burkholder Harris said. “It’s not financially feasible.” But this is where non-profits can step up, “provided they stack a lot of funds and subsidies on top.”

Burkholder Harris pointed to an ongoing development at the “Library Parcel” of Ottawa’s LeBreton Flats as an example. The project will see 601 new rental units built, 247 of them affordable, in two towers between Ottawa’s future Ādisōke main public library and the local light rail transit station. The Multifaith Housing Initiative will own and operate 130 of the affordable units in perpetuity, meaning tenants will never find themselves living in a home suddenly costly beyond their means.

It may be smaller scale than other conversions in Ottawa, but 44 Eccles in Ottawa’s Chinatown is an example of what can be done when non-profits are supported in their mandate to provide affordable housing, Graeme Hussey, director of housing development at Centretown Citizens Ottawa Corporation (CCOC), told The Mix.

Funded in part by the Canada Mortgage and Housing Corporation’s Rapid Housing Initiative and supported by CCOC, the just-opened 46-bed supportive housing residence at a former school, then office building, will now be home to chronically homeless women and gender-diverse people. It owes its existence to another non-profit, Cornerstone Housing for Women, which will continue to own and operate the residence. 

Established in 1983 as the first women-only shelter in Ottawa, Cornerstone famously began with three cots in the basement of All Saints Church in Ottawa’s Sandy Hill neighbourhood. Today, the non-profit provides shelter for 125 women and long-term supportive housing for 110.

Feds Offload Public Buildings

Beyond funding affordability, the federal government has offered up some of its own holdings for housing conversions. Its 2024 budget commits “$1.1 billion over the next 10 years to offload its office holdings more quickly, as part of a plan it hopes will spur housing conversions in Ottawa and beyond,” reports CBC News. The funding will allow deferred maintenance to be completed, a critical step to speeding up lease terminations.

The budget also commits to turning 14 military properties into housing, including the 376,000-square-foot National Defence Medical Centre in the capital city’s Alta Vista ward.

The government will also lease land to build 500 new homes in the growing Wateridge Village community at the former Canadian Forces base in the northeast. Reporting on the transformation of that “largest chunk of undeveloped land left in the city’s core” back in 2016, the Ottawa Citizen wrote that the new community would “ultimately see an influx of some 9,500 residents in about 5,300 homes and condos over the next 15 to 20 years.” About 1,000 people already live in Wateridge, which includes more than 300 affordable housing units.

The budget also pledges to “overhaul” the Canada Lands Company, a move to accelerate construction of affordable housing projects on former public lands by enabling their transfer to Canada Lands for a nominal $1 fee. Current practice has Ottawa selling properties to Canada Lands at market rates.

“Wherever possible, public land should be used for homes,” states the budget. “Moving forward, the federal government will partner with the housing sector to build homes on every possible site across the federal portfolio.”

Gaye Taylor is a Senior Staff Writer with The Energy Mix