New owners Heafey Group, Boless mull residential conversion for Gatineau office tower
David Sali, OBJ
August 19, 2024
In a move that could add hundreds of housing units to downtown Gatineau, the new owners of a prominent office tower in the city’s core say they are looking at turning the building into a residential complex. Gatineau’s Heafey Group and the owners of construction firm Boless acquired the 15-storey property at 200 Sacre-Coeur Blvd. in a joint venture last month from Montreal-based CanPro Investments Ltd. for $18.5 million. Completed in 1973 and retrofitted about a dozen years ago, the 201,979-square-foot building is fully leased to the federal government and serves as a main office for Environment and Climate Change Canada. The government’s lease runs out at the end of 2026, with an option to be extended for an additional year.
While Heafey Group vice-president of legal affairs Steve Heafey said he is “pretty confident” the feds will continue to occupy the property until 2027, he added the building is a “good candidate” to eventually be redeveloped into residential units due to its rectangular shape, which lends itself well to apartments that won’t be too long and narrow. “It’s easier to convert it into a residential building because the units will have the right size. They will not be bowling alleys,” Heafey explained. At the same time, Heafey said the new proprietors are in no rush to send the building’s current tenants packing. “If they want to (extend the lease) more than (the end of 2027), we'll be more than willing to talk to them because they're a good tenant,” he said of the feds. “If they decide to stay there, that’s all good. But if they don’t, then we have option B, which is conversion.”
The site is already zoned for residential use. Heafey said initial estimates suggest the building could accommodate about 200 apartments, which would likely be rental units. Many of the property’s precast exterior concrete panels could be removed to make way for balconies, he said, adding to the building’s appeal. The new owners don’t anticipate there would be any significant construction hurdles during the conversion process, he explained. Heafey cited the building’s prime location near Jacques-Cartier Park and municipal tax credits aimed at spurring more multi-residential construction in the neighbourhood as key factors that influenced the companies’ decision to buy the property. “There’s a lot of development right now being done in that area,” he said. “The City of Gatineau has been very aggressive the past 10, 12 years. They want to densify that area, bring back people to the downtown (core). “When we bought it, (a conversion) was our main objective,” he continued. “But we’re open to (renewing the lease) with the government if that’s what they want. We have time on our side to start planning.” Founded by Gatineau businessman Pierre Heafey in the late 1980s, Heafey Group owns more than $1 billion worth of assets. Its diverse portfolio includes residential, industrial and office properties as well as retail complexes and hotels in Gatineau, Ottawa and Florida. Among the major projects in its ongoing development pipeline are the We, a residential complex on Wellington Street in downtown Gatineau. The firm just started construction of the third phase of the project, a 29-storey, 300-unit apartment building. With a vacancy rate of 1.1 per cent in 2023, Gatineau is one of the country’s tightest rental housing markets. But the average rent for a two-bedroom apartment is still hundreds of dollars below the going rate for similar apartments across the river, driving demand for more new builds, Heafey explained. “It helps us attract more people from Ottawa,” Heafey said of Gatineau’s lower rents. “It’s a good market.” Meanwhile, the firm has a number of projects planned or already on the go in the nation’s capital, including a 193-unit building near St. Laurent Boulevard that is almost complete.
“We have a lot on our plates right now,” Heafey said.
https://obj.ca/new-owners-mull-conve...-office-tower/
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