Centrepointe area development, City of Ottawa | Proposed

[rocketphish]

City looks to purchase prime land near Algonquin College for steep discount
City of Ottawa could buy land worth up to $92M for just $12M

Nicole Williams · CBC News
Posted: May 25, 2024 4:00 AM EDT | Last Updated: 6 hours ago



City of Ottawa staff are recommending the purchase of the Mary Pitt Centre in Nepean, a property worth about $92 million for just a fraction of the cost.

In a newly released report addressed to the finance and corporate services committee, staff asked council to approve the purchase of 100 Constellation Dr., and the surrounding property from current owner Arnon Corporation.

The 6.88 hectares of land includes the building that houses the Ottawa Public Health immunization clinic, the Ontario Court of Justice and others, as well as the surrounding parking lots.

"The Mary Pitt Centre, is the largest administrative centre in the city portfolio and integral to the city's accommodation strategy," reads the report.

The estimated property value is between $84 million and $92 million, but the purchase would only cost the city $12.2 million, including closing costs.

It's a steal for the city, which negotiated the price tag in 2003 when it obtained the option to buy the land after taking over the lease from Nortel Networks, a former Canadian telecom giant that went bankrupt.

Up until now, the city has been renting space in the building there for $6.3 million a year. Staff said even with an estimated $1 million in annual expenditures, buying the land would save the city an estimated $5.3 million every year.

Staff also warned that the current lease is set to end by the end of Feb. 2026, with no option to renew and with no guarantees of securing a new lease, reads the report.

Buying the land "represents a secure path forward to ensure uninterrupted occupancy and service delivery."

Beyond that, College Ward Coun. Laine Johnson said the property offers a number of development opportunities that could benefit the community.

"It's massive and it's a really good deal for the city and it's going to be truly transformative for this community," she said.

Johnson said some possibilities include developing the land for housing, which could include units at market rent and others for low-income residents.

"A true mixed community for housing," said Johnson.

With more density also comes more business opportunities, she said, adding that the community is in need of smaller businesses, not just big box stores or chain restaurants.

The property is also located near Algonquin College. Staff wrote owning the land would also "provide added benefits to the City, which will be defined in the new Algonquin Station Secondary Plan, set to launch later this year."

The city would officially take over ownership of the property by the end of February next year.

The report will be formally discussed at the city's finance committee on June 4, before it is presented to council a week later.

https://www.cbc.ca/news/canada/ottaw...sing-1.7214132

[vtecyo]

Originally Posted by rocketphish

...The estimated property value is between $84 million and $92 million, but the purchase would only cost the city $12.2 million, including closing costs.

It's a steal for the city, which negotiated the price tag in 2003 when it obtained the option to buy the land after taking over the lease from Nortel Networks, a former Canadian telecom giant that went bankrupt.

Up until now, the city has been renting space in the building there for $6.3 million a year...

So... if I ignore currency inflation and assume that (relatively speaking) rent hasn't changed in all that time - does that mean the city has needlessly spent $132 million ($6.3 million x 21 years) renting a building they could have bought 21 years ago for $12 million!?

Or is it like a car lease - where you can usually only buy it out at the end of the lease? I sure hope they didn't just forget they had the opportunity to save over $100 million dollars...

[OTSkyline]

Yes, a decent refresh on those Lees buildings. They were becoming a bit of an eyesore in that section of the 417.

And nice to hear about 100 Constellation. I've always wondered driving around the area, and looking at Google Maps, why there were so much empty land and surface parking lot in that area. Near intersection of Woodroffe & Baseline, many bus routes nearby, a new LRT station coming soon, a major College, lots of retail nearby (including doctor's offices, banks, grocery stores, etc). It's perfect for redevelopment.

And the lot includes the building and all of the surface parking lots Southwest of the transitway and Navaho Dr, there's a real opportunity here for a dense little urban centre. Rentals, Student residences, a nice park or plaza (which is missing in this area).

[vtecyo]

Originally Posted by J.OT13

Thanks for posting Ponyboy. It is a bit of an upgrade.

They did close the balconies in one of the other Lees buildings before the pandemic, adding more floor space to the apartments. We'll see how it goes.



Some background. After amalgamation, the City had probably a dozen+ spare buildings to work with. For example, old City Hall (now the John D. Diefenbaker Building), Gloucester City Hall (building on Naismith near Blair being converted to residential) and the nice office building on Richmond, now flanked by UpperWest and the Amica Retirement Home. They probably sold them for very cheap, likely a fraction of what they are worth now. They could have kept a few and utilized the land for development, like the one on Richmond (but not Old City Hall, obviously).

The decision was to sell nearly them all off and lease this one with the option to purchase at the end of the lease. Certainly, they basically paid a pretty penny over 25 years, and Arnon is happy to sell it for a song now that the mortgage and maintenance was paid by the City (plus a healthy profit no doubt).

That said, 100 Constellation is probably a very well designed and built building. This was constructed by Nortel, for Nortel at their peak. They wanted the best for their employees.

Although a lot of opportunities were lost selling many of the former office buildings, there's a lot of potential with the eventual purchase of this particular tower, near Benjamin Franklin Place, Algonquin College, the O-Train and tons of parking begging to be redeveloped.

That makes sense - thanks for the details.

[J.OT13]

I was debating if I posted this in City of Ottawa, or this old Algonquin College Centrepointe thread, which has some aspects of the 2009 master plan for the area. I decided to create a new thread.

2009-2010 discussions: https://app06.ottawa.ca/calendar/ott...stellation.htm

2003 surplus propreties and lease agreement info: https://app06.ottawa.ca/calendar/ott...S-RPR-0040.htm