Feds' poor real estate planning could cost millions: consultant
Last Updated: Friday, January 9, 2009 | 1:50 PM ET
CBC News
The federal government will spend millions more taxpayer dollars to move thousands of employees out of aging buildings and into new ones than if the move had been planned better, says a local real estate consultant.
Darren Fleming, a senior adviser with GVA Devencore, a company that provides real estate advice and brokerage services, said the situation will create an artificially high demand for office space and contractors.
"If there's only three or four sites for new office towers in town and you ask for all of them at once, you're not going to get the best price," said Fleming.
More than a quarter of the government leases in Ottawa-Gatineau will expire within the next two years.
In December, the government put out a request for three office towers of 350,000 square feet each and a 2.8 million square-foot campus.
Fleming said the total is equivalent to almost all the office space in Kanata or Nepean.
He said the request was likely issued because many of the large campuses currently occupied by the government, such as Tunney's Pasture and some downtown buildings, are about 30 years old and in need of major repairs and renovations.
He suggested that the government could lose even more money if it wants to sell some of those buildings. Fleming said buildings are only worth something when they have the possibility of a tenant. If the government leaves a bunch of decaying buildings, the market will be flooded with worthless properties and the government won't be able to get a good price for them, he said.
Duff Conacher, head of the public interest lobby group Democracy Watch, said it's unacceptable that taxpayers end up paying more because of poor government management, but there's no effective way to hold politicians or senior public servants to account when their decisions essentially lead to waste.
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