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editor’snote
UNCERTAINTY HAS EMERGED as 2025’s leading contender for word of the year. Its meaning is generally understood (perhaps in contrast to the suddenly popular adjective, “existential”), but it takes form in varying intensities. Of late, that’s gone beyond mild dilemma and veered more toward immobilizing upheaval.
However, one thing that is certain for the 30th consecutive year is that this issue features our annual Who’s Who in Canadian Real Estate survey results. Thank you to the participating companies and to my colleagues, Gerald Ngan, Jason Krulicki and Katelyn Calouro, for collecting and coordinating this year’s responses.
It’s also fairly certain that commercial real estate players are now encountering turmoil that’s widely felt throughout the Canadian economy. There is a common hesitancy to invest or hire until there is more clarity on the United States government’s tariff agenda and what it will mean for costs, profits, asset value and market demand.
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Yet, over the past weeks of less-than-consistent messaging from American decisionmakers, industry insiders have expressed confidence in the attributes that position real estate and infrastructure to weather the storm. This issue reports on some of those discussions. Developers are, by nature, looking ahead and calculating what they can expect when their projects are complete. From that perspective, many market watchers predict the tariff issue will be resolved before the year is over (particularly given the destabilization that’s forecast for the U.S. economy if they remain in place); interest rates continue to drop; and construction labour costs have become more competitive than during the condo building boom, potentially helping to offset tariff-related cost escalation.
“When we’re building, we’re not looking at rents today, we’re looking at rents in five years. This is the right time to get into the ground,” Ugo Bizzarri, Chief Executive Officer with Hazelview Investments, observed during an industry panel discussion in Toronto earlier this winter. “Fundamentally, Canada has a lot of really long-term demographic positive aspects.”
The sector’s range of relatively recession-proof assets — housing, grocery-anchored retail, key infrastructure — provides further assurance. There’s optimism that investors and financiers currently on pause will be actively deploying capital once more certainty returns to the market, while, historically, governments have invested in public infrastructure that’s intended to underpin economic growth during lull times.
“If it’s mission-critical, there is a need that’s driving it that doesn’t go away just because of tariffs,” reiterates Ted Betts, a Partner and Head of the Infrastructure and Construction Group with Gowling WLG in Toronto. “Certain aspects of it may be delayed, but they’re still going to be going forward.”
Decarbonization — at both the infrastructure and building levels — arguably falls into that category, as physical and transitional climate risk continues to threaten the value of the built environment and the security and prosperity of its inhabitants. Apropos, a cherished tale about resilient buildings could be instructive.
The three little pigs eluded the big bad wolf because they had a sturdy sanctuary that gave them the time and space to rally their defences. Equally important, they tackled the threat strategically, were mindful of each other’s well-being and worked together. That makes for a strong base to withstand malevolent huffing and puffing.
Barbara Carss barbc@mediaedge.ca
Focus: Real Estate Trends & Context
6 Return to Fundamentals: Investors renew focus on property picking acumen.
12 Lender Latitude: Most real estate asset classes get more favourable ratings for 2025.
22 Decarbonization Dexterity: Commercial real estate asset managers look for more workable math for their business cases.
25 Who’s Who in Canadian Real Estate: The 30th annual survey of the industry’s players and portfolios in the office, industrial, retail and multifamily sectors.
18 Reductions Redirection: Other measures tapped to fill the breach of cancelled consumer fuel charge.
40 Electric Ambitions: Ontario recharges its energy efficiency budget.
44 Consulting on Caps: Toronto prepares building emissions performance standards.
46 Cross-Border Ambiguity: Refrigerant restrictions differ in Canada and the United States.
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RETURN TO FUNDAMENTALS
Investors Renew Focus on Property Picking Acumen
By Barbara Carss
RETAIL WAS THE BEST performing asset type last year for institutional investors represented in the MSCI/REALPAC Canada Property Index. Results from 2024, capturing 54 participating commercial real estate portfolios, reveal year-over-year improvement in all four of the major property sectors, as the average total return across all standing assets crept up to 3.21% after coming in flat in 2023.
That was realized through a 4.91% income return to offset a 1.63% loss in capital value. Similarly, improved average total returns for retail, multifamily, industrial and office were largely attributable to income return. Industrial and office both lost capital value,
while average capital gains were very modest for retail (0.8%) and multifamily (0.1%).
Income was also the major factor in seven of the eight surveyed regions, with Halifax standing out as an anomaly in posting 5.4% capital growth. Among the four largest markets, Calgary delivered the top average total return, at 6.5%, followed by Vancouver at 4.1%, then Montreal and Toronto both hovering around a 2% average total return.
In parsing out those results, industry analysts draw connections to unfolding real estate cycles. That has a brought a vast injection of new industrial supply since earlier in the decade when investors were realizing
outsized returns on their industrial assets. Meanwhile, relatively modest retail development activity has fallen behind the pace of population growth.
“It was the case that a portfolio overweighted to industrial would outperform, but that has fallen off now. From a portfolio standpoint, it’s coming back to fundamental real estate management — not necessarily over-allocating or under-allocating, but selecting the best properties and managing the right properties,” Peter Koitsopoulos, Vice President with the index producer, MSCI, told a gathering on hand in Toronto for the release of the investment results. “I think the industry
has partly lost track of that. It’s good to see those fundamentals coming back.”
INDUSTRIAL MARKET REBALANCES
Continuing with that theme, he theorized that below-average total returns for industrial properties in Toronto and Montreal are symptomatic of a flood of new investment. Canada-wide, industrial assets delivered a 3.4% total return on average — breaking down to a 4.2% income return against a 0.7% decline in capital value. Among the four largest markets, that varied from average total returns of 6% in Vancouver and Calgary to 2.1% in Toronto and negative 0.8% cent in Montreal.
“Not too long ago, those two markets were having year-over-year returns of 30 or 40%, which is quite remarkable for real estate. That triggered a lot of building, a lot of supply coming to the market, and that excess supply really being absorbed by investors in Toronto and Montreal,” Koitsopoulos recounted. “This is actually a good thing in the sense that it creates a balanced market for Toronto and Montreal, which is something we haven’t seen for a long time. Having a balanced market, even though it lowers returns, is actually positive.”
Investors enjoyed positive average total returns on retail properties across all markets, but recorded the best results in Calgary, with an 8.6% total return. Average total returns
mimicked retail’s 6.5% national average in Vancouver and Toronto, and settled at 5% in Montreal.
Commenting on the sector’s strengths as part of an associated panel discussion, Cathal O’Connor, Chief Executive Officer of Salthill Capital, cited: rising rents as lease renewals catch up with inflation; population growth that has eroded Canada’s “over-retailed” accumulation of enclosed malls; and a particular competitive advantage for groceryanchored, open-air centres from lower operating costs and taxes (see story, page 36) than enclosed malls.
“We’ve been under-building retail now since 2016 and, quite frankly, tenants can’t afford to pay rents for new retail [that does get
UNCERTAINTY CHILLS INVESTMENT IMPETUS
Tariffs and geopolitical uncertainties threaten investment chill in a year that was otherwise looking upbeat. Although last year was the third consecutive year of negative capital growth for the MSCI/REALPAC Canada Property Index, the 1.63% slip in value was more muted than the declines of the previous two years. Meanwhile, a 4.91% income return continued a steady uptick from 2022 (4.35%) and 2023 (4.6%).
“We can see an improvement in the capital growth in that things are getting less worse. So that does start to signify that maybe there’s a market recovery,” Peter Koitsopoulos, Vice President with the index producer, MSCI, told a gathering in Toronto earlier this winter. “We also have to consider that, fundamentally, we do not see the incomes in Canada deteriorating. The fundamentals of Canadian commercial real estate and where [index] participants are investing is fundamentally sound, and I think that’s an important distinction to make.”
A discussion of industry dynamics, held in conjunction with the release of the 2024 investment results, highlighted sector-specific and economy-wide uncertainties now clouding the investment outlook. Hesitant lenders, the Canadian dollar’s diminished buying power and foreign investors holding off due to perceived risk or anticipated better bargains in the future could all impede activity. As well, there’s concern about tenants’ ability to absorb another economic shock following the COVID-19 pandemic and a double-whammy of inflation and rising interest rates.
“Things were loosening up. The debt was finally priced at a point where, if you were in one of the major sectors, you had positive leverage,” observed Michael Fraidakis, Chief Investment Officer with LaSalle Investment Management in Canada, where the firm has more than $4 billion in assets under management (AUM). “My fear is that, in real estate, it’s going to introduce investment and pricing uncertainty again and that will be another round of just more capital on the sidelines.”
Liz Murphy, Chief Financial Officer with Oxford Properties Group, concurred that the turnaround may not to be as quick as was envisioned a few months ago. As the real estate arm of the OMERS pension fund, Oxford holds roughly $85 billion in AUM globally with about 75% of that located in North America.
“Our teams were ready. We were seeing pricing at the right level and space for income returns at the right level, but, with this uncertainty, I think we will slow down unless it’s a really, really good opportunity,” she said.
Canada is generally seen to enjoy stronger fundamentals than the United States in all four major asset classes. Fraidakis noted that Vancouver, Toronto and Montreal continue to boast lower vacancy rates than major U.S. markets and that foreign investors are tending to look more at Canada-specific allocations rather than lumping it together with the U.S.
“The fundamentals and our currency being where it is helps on the buyer side,” he said.
“The pricing of real estate right now is good. You can buy real estate and you can earn a good income return. That will really help to push through all this uncertainty,” Murphy submitted. “Hopefully, we get an opportunity where interest rates are low for a period of time.”
Certainty is still a missing ingredient, however.
“When you don’t know what the rules of the game are, you’re going to be cautious,” said Jim Costello, MSCI’s Chief Economist.
“I wouldn’t bank on cap rate compression for the next little while.”
built],” he said. “That’s why retail is a good buy.”
Office posted a flat average total return across the index after a negative 5% total return in 2023. There was a further 5.4% drop in capital value last year (following a 9.9% decline in 2023) against a 5.7% income return. Calgary and Vancouver saw modest average total returns of 1.9% and 0.5%, respectively, and Toronto rallied somewhat from a negative 5.1% average total return in 2023 to negative 1.1% in 2024.
Ottawa also improved from a negative 9.9% total return in 2023 to negative 3.3% in 2024, but remained the worst performer among office markets.
“The government workers are starting to go back to the office and that’s having a positive impact in Ottawa, but, over the last couple of years, Ottawa has been hit hard by
those workers being slow to go back to the office,” Koitsopoulos observed.
PORTFOLIO DIVERSIFICATION
Other panellists echoed Koitsopoulos’ general conclusions that income returns and strategic management are primary focuses for investors, particularly with the sudden added uncertainties of tariffs and other geopolitical upheaval.
“Coupled with available financing, especially in the major asset classes, you’re buying for a really good equity yield right now,” advised Michael Fraidakis, Chief Investment Officer for LaSalle Investment Management’s Canadian holdings. “I wouldn’t bank on cap rate compression for the next little while. We’re back to income and having a portfolio that’s diversified enough to maintain that.”
Looking beyond, retail, multifamily, industrial and office, panellists also pointed to positive prospects for niche assets. “From public pension funds, there is money for certain sectors — data centres, self storage, university rentals,” O’Connor said.
However, sparse existing inventory and hefty costs to develop new supply present barriers. Thus far, some Canadian investors have largely stuck to financing other developers and deal-makers in those burgeoning areas.
“Our credit book has lent to student housing and data centres, but data centres are very big cheques and I think we’ve taken the approach that we’d rather not [invest directly] right now,” reported Liz Murphy, Chief Financial Officer, with Oxford Properties. “We haven’t seen a lot of opportunity [for data centres] here in Canada, or for student housing either. There’s a lot more opportunity for both those sectors in the U.S.”
“The space is crowded from an investment dollars perspective relative to the universe of assets,” Fraidakis concurred. “That is a sleeve that will continue to grow no matter what your portfolio looks like, particularly an institutional portfolio. It’s just that Canada is lagging other countries, particularly the U.S., in terms of the numbers of assets.”
• Parking Lot Paving
• Asphalt Repair
• Asphalt Maintenance
• Concrete Work
• Roadway Paving
• Driveway Paving
• Curb & Sidewalks
• Catch Basin Repair
• Gravel Installation
• And More...
MAINTAINING SAFE AND RELIABLE HOUSING:
BLACK & McDONALD’S ROLE IN VANCOUVER’S SINGLE
ROOM OCCUPANCY RENEWAL INITIATIVE
Black & McDonald (B&M) is proud to play a key role in the Single Room Occupancy (SRO) Renewal Initiative, a project dedicated to revitalizing 13 heritage hotels in Vancouver’s Downtown Eastside. With approximately 900 residential units, this initiative provides stable housing
for individuals facing complex challenges. Our team is responsible for Facility Maintenance, ensuring the functionality and safety of these essential buildings and enabling residents access to stable housing with integrated support services. Through a combination of self-performed
Photo by Sama Jim Canzian
services and strategic subcontracting, B&M delivers comprehensive mechanical, electrical, and plumbing solutions, as well as general maintenance for building systems, fire safety, and structural integrity.
A MULTITRADE APPROACH TO FACILITY MAINTENANCE
B&M’s scope of work encompasses a diverse range of services, ensuring every building remains operational and safe. Our responsibilities include:
• Technicians performing all HVAC, mechanical, electrical, and plumbing services to the units
• Extensive major maintenance, repairs, and replacements
• Fire alarm and fire safety systems upkeep
• Cold water plumbing systems
• Building make-up air supply and filtration
• Base building maintenance
Through our Central Call Centre, we provide a streamlined response system for maintenance and repair requests. This communication method has ensured effective and efficient services. The Call Centre is also paramount in acting as the checkpoint for all work requests and prioritizing and dispatching them to ensure effective response to demand maintenance.
SUPPORTING BC HOUSING WITH RESPONSE & SPECIALIZED SERVICES
B&M is not only responsible for routine maintenance but also plays a critical role in responding to additional work requests. These requests vary from making additions to CCTV camera systems, rebuilding equipment damaged by fire or flood, and electrical upgrades to support the addition of cooling on site. By leveraging both self-performance and trusted subcontractors, we maintain service quality across all properties. Our commitment to service excellence is further demonstrated through our ability to handle projects of varying sizes. Minor projects under $300K are efficiently executed while larger-scale renovations and system upgrades are carefully planned and managed to ensure a smooth project experience without interruptions.
INNOVATION AND EARLY INVOLVEMENT FOR BETTER OUTCOMES
One of B&M’s key strengths in this initiative is our proactive approach to project management. The contract
has stringent requirements in place, requiring working with BC Housing and the nonprofit service providers that are delivering services to residents who face complex challenges. By engaging with BC Housing from the bid stage, our operations team has helped shape the contract in a way that ensures maintainability, reliability, and serviceability. This early involvement has allowed us to anticipate challenges, optimize maintenance strategies, and contribute valuable lifecycle insights for ongoing renovations.
A LASTING IMPACT ON VANCOUVER’S HOUSING INFRASTRUCTURE
B&M’s continued involvement in the SRO Renewal Initiative demonstrates our expertise in heritage building facility management and our ability to provide solutions that support the infrastructure needs of BC Housing. By maintaining a balance between reactive and proactive maintenance, we ensure that each facility remains functional. Our team is committed to upholding the highest standards of service while adapting to the unique challenges of this initiative. By leveraging our technical expertise, we are not only meeting contract expectations but also supporting BC Housing in maintaining these important heritage buildings.
For more information, visit www.blackandmcdonald.com or reach out to facilityserviceinquiries@ blackandmcdonald.com
Real Estate Mostly Gets Favourable Rating LENDER LATITUDE
By Barbara Carss
CANADIAN LENDERS may be reassessing the urgency of decarbonization, but they still express enthusiasm for sustainable assets and impact investments. Recently released findings from CBRE Canada’s annual survey of lenders’ attitudes and intentions toward commercial real estate reveal generally diminished expectations that buildings’ greenhouse gas (GHG) emission profiles will have a material impact on financing conditions in the near term.
Yet, while sustainability is not a ranking must-have, there is evidence that it’s a preferred attribute. More than 40% of survey respondents currently offer better credit spreads, averaging out at 8 basis points, for assets with sustainability credentials such as LEED or BOMA BEST certification, and an additional 19%
say they will begin doing so in the near future.
“There is a bit of a disconnect here,” acknowledged Joshua Sonshine, a CBRE Senior Vice President, as he highlighted some of the survey results during a late February presentation in Toronto. “Basically, it pays to have sustainability-focused assets, but, no, the lack of those credentials won’t stop you from getting financing.”
Meanwhile, on the social benefits side of the equation, 86% of surveyed lenders are looking to increase their budgets for CMHC-insured (Canada Mortgage and Housing Corporation) construction loans for purpose-built rental housing this year. That’s a category in which there has been robust developer uptake of the MLI Select program to support affordable, accessible and energy-efficient supply.
IMPROVED OUTLOOK
The latest edition of the annual survey was conducted between Dec. 10, 2024 and Jan. 20, 2025, drawing input from 37 institutions — including domestic and foreign banks, credit unions, insurance companies, pension funds and private debt capital — that collectively hold more than $200 billion in commercial real estate loans.
This year, 76% of respondents plan to originate more loans, with 24% targeting at least a 20% cent year-over-year increase in capital deployed to commercial real estate. As well, lenders report an improved outlook on almost every asset class except for development land and high-rise condominiums.
Turning to asset characteristics, a larger share of respondents — 17% versus 11% in late 2023 — report that buildings’ carbon
footprints already have a material impact on the availability of capital and mortgage terms. However, 47% suggest that sustainability factors will not affect their decision-making for at least five years or perhaps not at all. As well, no respondents foresee material impacts on mortgage terms within the next two years, even though nearly 20% made that prediction in the previous two annual surveys.
Among those who expect GHG emissions profiles will influence debt availability and mortgage terms before the end of this decade, just 11% envision a significant impact while the larger share expect a limited to moderate impact. CBRE’s capital market specialists hypothesize that Canadian lenders are now taking more cues from the United States, where the new federal administration shows little sign that it will push financial institutions to address physical or transitional climate risk, than from Europe, which has long been upheld as a harbinger of what’s looming on the regulatory front.
“As much as European lenders continue to ratchet up sustainability requirements, it just doesn’t seem like those practices or expectations will be a reality in Canada for many years,” Sonshine mused.
“These results also align with CMHC’s announcement in June of 2024 that the allocation of points available under the MLI Select’s energy efficiency criteria would be reduced in new rental construction,” observed his co-presenter, Jessica Harland, also a Senior Vice President at CBRE.
AFFORDABILITY PROMPTS
Under the MLI Select program rules, prospective borrowers must achieve at least 50 points through any combination of designated options for affordability, accessibility and/or energy efficiency in order to secure loan insurance. At 50 points, they are eligible for backing for up to a 95% loan-to-cost (LTC) ratio on the housing portion of a project (up to 75% LTC on the non-residential component) with an up to 40-year amortization period. That jumps to a 45-year maximum amortization at 70 points and to 50 years at 100 points.
Currently, loan candidates can achieve a maximum of 100 points for affordability, a maximum of 50 points for energy efficiency and a maximum of 30 points for accessibility.
Joining the presentation proceedings to provide more context, CMHC’s President and Chief Executive Officer, Coleen Volk, acknowledged that the program is anomalous with the agency’s mandate to be a commercial supplier of insurance, but explained it as a purposeful business deviation to try to nurture more housing supply.
“We stand by that decision, but it has complicated our world because we are trying to operate a commercial enterprise with a very explicit policy element to it,” she maintained. “Now that we have this, the industry is greatly relying on it. It’s been very important to the purpose-built rental that has been built over the last little while.”
Rob Kumer, Chief Executive Officer of KingSett Capital, underscored that fact in an associated panel discussion. He calculates that roughly $280 million raised through his firm’s affordable housing fund will translate into $2.5 to $3 billion worth of development because projects can be so highly levered.
“There’s a whole bunch of things going on in affordable housing that actually make a lot of sense. We’re finding a lot of success,” he said. “It’s taken us awhile to get here because, with every deal, you sort of start from scratch. You work with the City, the Province, the Feds, CMHC to try to put
investment
together a structure that makes sense and put you in a spot where you can get going, but, ultimately, you can find ways to be creative and make money in these projects.”
Volk expressed hope that others will catch on to the possibilities.
“Multiples is a huge business and it’s been growing by leaps and bounds. Wearing the social policy hat at CMHC, I say: I am so happy to see that growth and I am so happy to see that supply. As the insurance provider, I say: It would be so nice if we weren’t the only game in town,” she advised. “It would be great if we could see conventional players come in.”
CONDO HESITANCY
Loan conditions are expected to be onerous for residential condominium developments again in 2025, following a year when many lenders pulled back on construction financing. Nearly 60% of survey respondents now categorize development land as an asset class with cause for concern, up from 35% heading into 2024. More than 40% also deem high-rise condo to be an asset of concern, up from about 10% in the previous survey.
“Lenders are feeling increasingly good about every asset class with the exception of the condo and land market,” Harland advised. “What is really notable, is that many lenders
express significant appetite for rental construction, but very few of them noted intentions to increase the exposure to the land loans needed for the underlying rental construction to happen.”
For 2025, 32% of surveyed lenders intend to increase their loan budgets for high-rise condo, while 11% say they’ll reduce condo loan volume. No lenders plan to increase their budgets for development land, but 26% expect to shrink them. That’s after 59% of lenders fell below their targets for condo construction loans in 2024.
“This is particularly troubling given that high-rise condos are historically, in recent years, accounting for much of our housing supply,” Sonshine said.
When surveyed in the fall of 2023, 72% of lenders gave notice that they’d be requiring more upfront equity on condo construction loans in 2024. For 2025, 52% indicate they’ll ratchet that requirement up further.
As well, 36% of lenders say they’ll be looking for higher deposits and shorter payment schedules to secure the loan, and 68% will want to see the pre-sale of 60 to 79% of units. That latter condition is seen as a growing challenge for financing, given the year-over-year drop in sales levels in the new condo market.
Meanwhile, falling land values have lenders wary, with more than three quarters of survey respondents suggesting that development land poses an elevated or significantly elevated credit risk. To illustrate, Harland noted that land purchased at $200 per buildable square foot in 2021, carrying $100 per buildable square foot of debt, might now be worth about half of its original value.
“That puts the original land loan at risk so the lending community’s hesitation is not unwarranted. The risk that a lender may be caught holding the bag is there,” she said.
“Land financing trends across Canada have been significantly influenced by higher interest rates, economic uncertainties and evolving government policies. Lenders are hesitant to mortgage development land due to factors like uncertainty of the underlying value, risk of non-completion of the project, zoning and permitting issues, cashflow or lack thereof, longer timelines and complexity of development plans.”
The 2025 Canadian Real Estate Lenders’ Report can be found at www.cbre.ca/insights/ reports/canadian-real-estate-lendersreport-2025.
Having the technical expertise and insight to conduct retrofit projects in established buildings without affecting the day-to-day business of occupants is our specialty. It’s what sets us apart.
The truth is, existing buildings are far more complex and challenging than new construction, and require a unique game plan every time. It’s why the process for delivering mechanical and electrical engineering solutions requires more than a cookie cutter approach – it demands that you have a deep insight into the building and how new systems can be integrated into existing systems seamlessly.
All of our projects are reviewed by senior engineers, each with over 30 years of experience in their respective fields, ensuring that our clients always receive engineering services of the highest quality.
Neil Spence, Director of Electrical Engineering, Building Services
Rob Niessl, P.Eng., Director of Engineering, Northern Region
Ming Xiong, P. Eng. Mechanical Engineering Principal
Mark Dahmer, P.Eng., PMP Mechanical Engineering Principal
Peter LaForme, Executive Vice President
Andre Lebedev, P.Eng., Director of Electrical Engineering
Robert Borovina, P.Eng., Director of Mechanical Engineering
A BOMA Initiative
Une initiative de BOMA
SIMPLIFY SUSTAINABILITY: ENERGY EFFICIENCY RESOURCES FOR MID-TIER BUILDINGS
Mid-tier building owners and managers juggling multiple priorities now have valuable allies in their sustainability journey. The BOMA Enspire program offers supportive funding and guidance specifically designed to help Class B and C building professionals unlock energysaving potential in ways that respect their unique challenges and constraints.
“Focusing on the mid-tier building sector, which makes up over 65% of Canada’s total building stock, offers an unparalleled opportunity to elevate operational standards across the industry,” shares Bala Gnanam, Vice President of Advocacy and Stakeholder Relations with the Building Owners and Managers Association (BOMA) of Canada.
BOMA Canada is delivering this program with funding through from Deep Retrofit Accelerator Initiative (DRAI). Since its launch in Fall 2024, BOMA Enspire has engaged with over 11,000 buildings across Canada, with more than 200 participating in its first funding initiative, the Quick-Start Audit Initiative. Building on this encouraging response, the program will soon introduce the Building Performance Excellence Initiative this spring.
The upcoming Building Performance Excellence Initiative will offer a flexible menu of support through three complementary streams:
1. Energy Opportunity Identification: Funding for audits and technical studies
2. Building Performance Optimization: Support for recommissioning, monitoring systems, and green building certifications
3. Deep Retrofit Enablement: Resources for planning, design, and management of major retrofits
Participants can receive support for up to 80% of eligible costs, with combined project caps of up to $125,000 per building. This flexible structure allows building owners and managers to select the activities that best address their specific needs and priorities.
All BOMA Enspire enrollees will have access to a robust education series, certification training, and information sessions providing valuable insights to improve their building’s performance.
Understanding that mid-tier building professionals excel at maintaining day-to-day operations despite often having limited resources, BOMA Enspire helps owners and managers navigate what can sometimes feel like an overwhelming process: determining emissions profiles and creating practical savings plans aligned with their unique goals, resources, and budgets. Qualified and experienced
energy management and sustainability professionals serve as guides, offering their expertise to make success accessible.
Industry service providers have been instrumental in connecting their clients with BOMA Enspire and providing guidance through the enrollment process. To strengthen these vital connections, BOMA Enspire will launch its Service Provider Directory this spring, creating a trusted resource to help building owners and operators connect with qualified professionals, streamlining the path to building improvements.
Focusing on the mid-tier building sector, which makes up over 65% of Canada’s total building stock, offers an unparalleled opportunity to elevate operational standards across the industry. ”
-
Bala Gnanam, Vice President of Advocacy and Stakeholder Relations with the Building Owners and Managers Association (BOMA) of Canada
PREPARING FOR THE FUTURE WHILE BENEFITING TODAY
As the regulatory landscape continues to evolve, proactive building improvements are increasingly important. While the full details of future compliance requirements are still developing, it’s reasonable to expect that buildings not meeting minimum performance standards could face financial penalties. Inaction at this time will inevitably lead to consequences in the near future.
“Enhancing the everyday experience of building occupants is key to driving tenant satisfaction and long-term retention.”, notes Benjamin Shinewald, President & CEO of BOMA Canada. “While immediate business needs often take priority, neglecting updates ultimately impacts usability, tenant comfort, and your bottom line. By addressing these issues proactively through programs like BOMA Enspire, owners create not just more sustainable buildings, but more profitable ones as well.”
The BOMA Enspire program offers a practical path forward that delivers multiple benefits: operational cost savings, enhanced appeal to tenants, and preparation for future regulatory requirements. By making sustainability more accessible for mid-tier buildings, the program helps transform challenges into opportunities for the commercial real estate sector.
Building owners and managers interested in getting ahead of regulatory requirements while capturing significant operational benefits can begin their energy savings journey today. The program website at www.bomaenspire.ca provides comprehensive information, while the support team is available via email at support@bomaenspire.ca or by phone at 1-877-BOMA-511 (1-877-266-2511)
REDUCTIONS REDIRECTION
Other Measures Tapped to Fill Breach of Consumer Fuel Charge
CANCELLATION OF THE consumer carbon price comes with the Canadian government’s affirmation that tax credits and other incentives for reducing greenhouse gas (GHG) emissions from buildings remain in place. A recently enacted federal regulation reset the carbon-related surcharge on fossil fuels to $0.00 per tonne of carbon dioxide equivalent (CO2 e) as of April 1, 2025, but continues the output-based pricing system for large industrial players that
emit more than 50,000 tonnes (50 kilotonnes) of CO2 e annually.
The latter group has been subject to the same pricing trajectory as household and commercial consumers paying the fuel charge, but it is applied as a pertonne rate on emissions that exceed a prescribed limit. This rose to $95 per tonne of subject CO 2 e emissions this spring, while accompanying analysis with the new regulation indicates further adjustments will be considered to
“refocus” carbon pricing in the future.
“In the absence of the fuel charge, other measures will continue to incentivize emissions reductions,” the regulatory analysis states. “The federal government intends to strengthen Canada’s approach to carbon pricing for industry to ensure its continued effectiveness and continue to make progress on climate targets.”
An estimated 12.57 megatonnes (Mt) of emissions reductions projected to be
attributable to the consumer carbon price between 2025 and 2030 will now be foregone. However, the regulatory analysis cites a combination of other government policies that could offset that loss so that it amounts to just a 3 Mt setback. Those counterbalancing factors include the clean fuel regulations, mandates for zeroemissions vehicles and the package of initiatives known as the green buildings strategy.
“There are now a suite of different emissions reduction policies, and removing the fuel charge now would have a smaller impact on emissions compared to when it was introduced,” the regulatory analysis declares. “There are now other policies covering the same emissions sources that will take on a larger role if the fuel charge is eliminated.”
ALTERNATIVE CHANNELS
In particular, the clean fuel regulations, which have been projected to curb national GHG emissions by up to 26 Mt by 2030, are identified as a foil for potential backsliding in consumer behaviour. Since 2023, producers and importers of liquid fossil fuels (gas and diesel) must meet mandated thresholds for reducing the carbon intensity of product sold in Canada.
INSURERS EXPECTED TO DRIVE U.S. CLIMATE RISK RESPONSE
Trends analysis from the U.S. Commercial Real Estate Finance Council (CREFC) foresees a diminishing emphasis on reducing greenhouse gas (GHG) emissions and a pullback on environmental policymaking, yet identifies market forces that will keep energy performance and climate risk on the agenda.
The report, prepared by Oxford Analytica, monitors incumbent and emerging sustainability issues expected to be pertinent to commercial real estate over the coming three years, and is used to inform CREFC’s advocacy and education efforts on behalf of its 420+ member companies in the U.S. finance industry. The inaugural edition, in June 2023, set out 16 baseline trends, which have subsequently been re-examined and updated at six-month intervals.
Five of those trends are now seen to have shifted in strength or staying power since assessed in June 2024. On the slippage side, analysts anticipate:
• lapsed attention to Scope 3 emissions;
• the arrest of progressively stricter energy efficiency standards;
• potential abandonment of the U.S. Securities and Exchange Commission’s (SEC) proposed requirements for climate-related disclosure; and,
• declining likelihood that biodiversity will evolve into a mainstream sustainability issue.
These requirements are designed to become more stringent on a yearly basis to progress toward the goal of reducing the combined emissions from extracting, refining, distributing and using the fuels by 15%, relative to 2016 levels, by 2030. That began with a stipulated reduction of 3.5 grams of CO2 e per megajoule (MJ) in 2023, with an
The one trend that’s gaining momentum is not an optimistic one, although it is perhaps validating for U.S. trade partners. Analysts hypothesize there is now more potential for a crisis-level shortage of affordable housing — to which, elevated tariffs are expected to contribute. The report also cites U.S. reliance on imports for about one-third of its construction materials and notes that Canada is one of the five top suppliers of those products.
Climate change adaptation and responsible water management are categorized as strong trends that will become more prominent over the next three years, but with different players conveying the message.
“The increased intensity and frequency of climate-change-induced severe weather events should support a continued focus on the resilience of the built environment,” the report states.
“Pressure on private commercial real estate developers not to build in areas at high risk of climate-related physical damage — and to build in climate resiliency if they do decide to build — is more likely to be financial (i.e., ‘un-insurability’ and more expensive capital) than political or regulatory.”
More information about the Commercial Real Estate Finance Council can be found at www.crefc.org.
additional 1.5-gram improvement mandated each year until a 14-gram CO2 e/MJ reduction is achieved in 2030.
That’s envisioned to be accomplished through a credit market, in which each credit represents a 1-tonne CO 2 e reduction. Fuel suppliers subject to the regulations can create credits or
purchase them from a verified source in three categories of investment:
• reductions in lifecycle carbon intensity through projects such as carbon capture and storage, on-site renewable generation or co-processing:
• low-carbon-intensity fuels such as ethanol and biodiesel; and
• fuel/energy for advanced vehicle technology such as electric vehicles or hydrogen-fueled vehicles.
Government analysts hypothesize that an uptick in fossil fuel consumption on household and commercial consumers’ part would force regulated fuel suppliers to make corresponding adjustments. Higher fuel demand and/or a diminished market for lower-carbon fuel blends would increase suppliers’ compliance obligations and create more pressure on the availability and price of clean fuel credits. The passthrough of those costs would then encourage a consumer pullback, while also spurring more investment in clean energy development and innovation.
“Higher CFR (clean fuel regulation) credit prices induce some additional
emissions reductions across sectors that create CFR credits,” the regulatory analysis maintains.
Canada’s electric vehicle availability standard, which will begin to roll out with the 2026 model year, is another identified brake on fossil fuel consumption. Automobile manufacturers and importers will initially be required to meet a target for light-duty (sedans, SUVs and small trucks) EVs to account for 20% of new sales, which will steadily rise to 60% of new sales by 2030.
“This significantly limits the national emissions impact of eliminating the fuel charge,” the regulatory analysis reasons.
BUILDINGS STRATEGY LIMBO
The ameliorating impact of the green buildings strategy is not so straightforward. Removal of the consumer carbon price is expected to lower the short-term economic cost of fossil fuels in all Canadian provinces and territories except Quebec, where a cap-and-trade system is still in place. The regulatory analysis acknowledges this could undermine originally projected emissions reductions,
“mostly related to the slower adoption of technologies which reduce emissions from natural gas used for home heating”.
In the commercial/institutional buildings sector, retrofit project proponents have commonly factored a carbon price set to rise to $170/tonne CO 2 e by 2030 into their payback assumptions and business cases for decarbonization. The regulatory analysis does not contemplate what the absence of that driver could mean.
However, the green buildings strategy is specifically identified as one of the “complementary climate mitigation policies” within the overarching climate plan, and there are hints that further refinements could be coming. “The environmental impacts of the amending regulations may be mitigated by other future climate policies implemented in place of the fuel charge,” the regulatory analysis states.
Buildings sector insiders have plenty of ideas on that front. A recent joint publication from the Real Property Association of Canada (REALPAC), the Canada Green Building Council
widescale decarbonization projects, in keeping with Canada’s emissions reduction targets, can be practically justified, funded and delivered. (See story, page 22) That identifies some pressing needs for costcompetitive technology, amenable financing and supportive public policy, and includes a list of enabling mechanisms that government, other key institutions and industry service providers could contribute.
“The portion of the carbon price that consumers pay at the pump or point-of-sale is getting dropped, but the carbon pricing model still holds,” reiterates Bala Gnanam, Vice President, Sustainability, Advocacy and Stakeholder Relations, with the Building Owners and Managers Association (BOMA) of Canada. “Now there needs to be a combination of other tools to take the place of the fuel charge so that we are still on track to meeting our targets.”
ACCELERATED REGULATORY PROCESS
The new regulation is discordant with conventional Canadian government practice in that it was not published as a proposed draft for public consultation. This is described as necessary to meet the government’s objective to remove the fuel charge on April 1.
The regulatory analysis relies on the Ministry of Environment and Climate Change Canada’s modelling program, known as EC-PRO, to estimate how the cancellation of the consumer carbon price will affect previously projected emissions reductions and related economic outcomes.
As well, it notes the possibility that some households and businesses will realize net economic gains from the elimination of the fuel charge, while others will be disadvantaged through the loss of the Canada carbon rebate. The latter scenario will be most prevalent among low-income households and qualifying small businesses with fewer than 500 employees that “had a relatively high number of employees and used relatively low amounts of fossil fuels.”
The regulatory analysis also clarifies that not all costs have been considered.
“In addition to reducing carbon emissions, the federal fuel charge could lower air pollutants that harm health and ecosystems,” it observes. “Removing the fuel charge could therefore result in environmental and health costs, which are difficult to quantify and not included in this analysis.”
The enabling regulation can be found at www. gazette.gc.ca/rp-pr/p2/2025/2025-03-15-x2/pdf/ g2-159x2.pdf.
“Now there needs to be a combination of other tools to take the place of the fuel charge so that we are still on track to meeting our targets.”
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DECARBONIZATION DEXTERITY
Commercial Real Estate Looks for Workable Math
OPERATIONAL greenhouse gas (GHG) emissions from Canada’s buildings sector are currently about 1.3% lower than in 2005, but that achievement is more significant when considering the expansion of the building inventory during the same period. Emissions intensity, measured on a per-square-foot basis, has dropped by a far greater degree.
Various players within the commercial real estate industry are now committed to continuing and supporting that momentum. Two leading industry organization, the Real Property Association of Canada (REALPAC) and the Canada Green Building Council (CAGBC) joined with researchers at University of Ottawa’s Smart Prosperity Institute over the course of the summer and fall of 2024 to consult with and glean insight from building owners and investors. Through this process, they identified a list of common barriers that owners/investors can encounter in efforts to decarbonize their portfolios, and an accompanying list of recommended actions for responding to and overcoming those hurdles.
“Bold action is required by all levels of government, utilities, the appraisal community, financial institutions and the industry itself,” urges REALPAC’s Michael Brooks, the CAGBC’s Thomas Mueller and Dr. Mike Moffatt from the Smart Prosperity Institute. “These recommendations recognize the delicate balance between federal, provincial and municipal jurisdictions, tight government and industry budgets, and multiple competing priorities.”
The resulting report, entitled, Decarbonizing Canada’s Commercial Buildings: The Owner & Investor Perspective, underscores the commercial real estate industry’s contribution of $148 billion in GDP and more than 1 million jobs to the Canadian economy. It also stresses that a reliable supply of affordable, clean energy is critical for emissions reduction, given that more than 90% of operational emissions from buildings are currently attributable to natural gas used for space and water heating.
The report calls on industry, government,
utilities, the appraisal community and financial institutions to collaborate via research, information sharing and pilot projects. Six significant barriers are seen to complicate building decarbonization: technology; capital; valuation; energy; people; and data, standards and disclosure. Industry, government, utilities, the appraisal community and financial institutions are each assigned a vital role in breaking down these barriers.
That begins with a suite of policies to help “make the math work” in order to drive further investment in decarbonization. Preferential financing and tax treatment, valuation premiums and carbon pricing or penalties could help provide an edge over the businessas-usual approach that’s perceived to deliver better returns over the short to medium term.
Building owners require access to low carbon electricity to decarbonize. However, in most jurisdictions, they have no choice on the electricity they can procure and no incentive — indeed even barriers — to generate clean electricity on-site. Furthermore, the grid in any given location in Canada may lack the electrical capacity required to support the decarbonization of buildings, particularly when there are competing uses for the available electricity, such as electric vehicle (EV) charging stations, digital media or artificial intelligence (AI) facilities, or heavy industry.
While low and net zero carbon buildings should require less future retrofit capital and face less regulatory and market risk over time, the appraisal community is not recognizing this lower risk of obsolescence in valuations. Nor are most real estate financial models recognizing it — making investment in decarbonization less compelling than it should be.
Decarbonization investments can pose economic and policy risks. Building owners are tasked with making long-term investments in decarbonization while providing value to their investors in an environment where climate policies and technologies are constantly changing. A plethora of standards, from net zero carbon definitions to international reporting
standards to municipal building emission performance standards, creates unnecessary complexity and makes decarbonizing buildings and portfolios more challenging than it should be.
Meanwhile, owners often do not have control over their tenants’ HVAC systems or access to their utility data in some building types, such as industrial and open-air retail. This lack of control makes it difficult for building owners to calculate whole building emissions and influence tenant energy consumption and emissions.
The report makes ten recommendations:
• increase incentives and knowledge sharing around decarbonization technologies;
• provide long-term low fixed-rate debt financing options for low carbon construction and retrofits;
• provide tax relief and incentives for low and net zero carbon buildings;
• recognize decarbonization investments in property valuations;
• grow capacity and conservation across electricity systems and continue to decarbonize existing electricity generation infrastructure;
• provide electricity users with choice for electricity procurement;
• increase decarbonization leadership, knowledge and skills across the industry;
• create stronger incentives for decarbonization;
• ensure building owners and investors have access to whole building data; and
• harmonize standards across Canada.
“Leaders will continue navigating the current uncertainties and finding their way around or through the barriers,” Brooks, Mueller and Moffatt maintain. “But, together, we can reduce barriers and co-create the conditions to accelerate building decarbonization in Canada.”
The complete text of Decarbonizing Canada’s Commercial Buildings: The Owner & Investor Perspective can be found at https://decarbonizebuildings.ca.
Membership matters
The Commercial Real Estate landscape is changing. The blend of an in-person and remote workplace, inflation, the aging workforce, ESG and climate change are all pressing challenges. Property managers look to BOMA Toronto for the network of resources to navigate these critical market issues, deliver operational excellence, and position themselves for success. BOMA Toronto members are in the know.
Build your skills, build your network, build your career.
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For membership enquiries, contact:
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Coordinator, Membership & Programs
c: 647-281-4821
e: cyossif@bomatoronto.org
JOIN SAVE ON ENERGY’S COMMERCIAL COOLSAVER PROGRAM AS AN APPROVED CONTRACTOR
Instant discounts on HVAC measures for your York Region customers
To be eligible, the proposed facility must be a commercial, institutional, industrial or multi-family building located in one of the following L4J, L4K, L4L, L4S, L6A, L6B, L6C, L6E, L6G, L7B. The facility must also be connected to the IESO-controlled grid and have one or more facility undertaking the measure(s). Customers must have the authority to implement eligible measures no later than October 1, 2025.
Subject to additional terms and conditions found at saveonenergy.ca
™ SAVE ON ENERGY is a trademark of the Independent Electricity System Operator (IESO). IESO 324 03/2025.
As the seasons change, being proactive with maintenance can save property managers time and money, while simplifying the day-to-day operations. Staying on top of regular maintenance can also extend the lifespan of your equipment, allowing you to maximize your budgets and avoid any unexpected surprises.
The new Commercial CoolSaver Program offered by Save on Energy, provides free A/C tune-ups for HVAC systems - plus exclusive instant discounts on a variety of high efficiency upgrades to York region non-residential customers, including schools, property management companies, community colleges, factories, malls, and large or small scale commercial facilities. The tune-up service is offered by trained, certified professionals to identify any potential issues with your HVAC system, allowing you to better manage your budgets and plan for the future.
Why Is It Free?
York Region has been selected as an area with identified electricity needs, and an AC tune-up will help you reduce your electricity consumption and save on energy costs.
“Save on Energy is offering this service at no cost to encourage property managers to take a proactive approach that goes beyond standard maintenance like filter changes,” says Amandeep Bharaj, Associate Conservation Account Manager at CLEAResult. “This funding provides managers with incentives to undertake preventative maintenance this spring.”
Getting ahead of the warmer weather can ensure that your facility stays comfortable, and your equipment remains functional throughout the season. “Summer is coming and there will
Eligible commercial, institutional and industrial buildings in York Region can receive free plus instant discounts on HVAC upgrades, with the approved contractor today and help your commercial customers save on energy!
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be peak days where everyone is using their air conditioners, which puts a hefty load on the grid,” says Bharaj. “Completing the tune-up gives you the peace of mind in knowing that your air conditioner will be reliable and efficient through the season.”
Commercial CoolSaver
The Commercial CoolSaver Program, while free to participants, has a value of $1040 with refrigerant adjustment. The tune-up is thorough and can be completed on both rooftop units and split central air A/C systems for commercial buildings. Recommended to be completed every five years in tandem with regular annual maintenance, the free tune-ups include airflow correction, air filter cleaning or replacement, digital refrigerant analysis, and cleaning of the indoor blower, evaporator coils, and condenser coils.
Benefits of an A/C tuneup
Beyond ensuring that your unit is in working order, the tune-up improves your equipment’s performance with better indoor air quality, along with longer-lasting, better-working cooling equipment. These improvements lead to higher tenant satisfaction, improved comfort, and reduced energy and maintenance costs. As well, should the experts find any issues with your equipment, you can address those immediately, taking advantage of instant discounts covering refrigerant, belts, controls, fans, and other energy-efficiency upgrades.
How can you get started?
Step one, all managers need to do is submit the enrollment form on the Save On Energy website. Step two, a trained, qualified contractor is assigned to perform the service as per your availability, making it a simple and efficient transaction for managers. Register early to secure spring scheduling, mitigate weather delays, and take advantage of the available funding.
This program, delivered in collaboration with Alectra Utilities, supports energy efficiency in commercial spaces, featuring CLEAResult as the authorized Save On Energy delivery partner.
To participate in the Commercial CoolSaver program, reach out to info@commercialcoolsaver.ca or complete the Participant Intake Form, and within five business days, you will receive a response from a Save on Energy representative, with the next steps.
WHO’S WHO 2025
PRESENTED BY:
HOW LEADING ASSET MANAGERS ARE USING TECHNOLOGY TO STAY AHEAD IN 2025
by Peter Altobelli, Vice President and General Manager, Yardi Canada Ltd.
Canada’s commercial real estate market is adapting to a shifting landscape defined by rising tenant expectations, evolving workplace trends and intensifying pressure on operational efficiency. According to CBRE, the national office vacancy rate reached a record-high 18.8% at the end of 2024. Meanwhile, retail rents continue to rise as demand outpaces supply in key urban centres. These dynamics are pushing real estate professionals to adopt a more strategic and agile approach — one powered by better data, automation and artificial intelligence (AI).
Today’s asset managers are expected to do more than preserve value. They’re tasked with uncovering growth opportunities across increasingly complex and dynamic portfolios. To meet that challenge, many are turning to advanced digital solutions that enhance forecasting, valuation and decision-making. As we move further into this year, those who embrace integrated technology will be best positioned to anticipate risks, respond to change and drive long-term performance.
From reactive to predictive asset management
The days of relying on spreadsheets and siloed systems are fading. Asset managers need real-time insight into property performance, market shifts and tenant behaviour. AI and machine learning are enabling this shift, offering tools that process vast datasets to reveal patterns and guide investment decisions. This includes providing realtime valuation updates, which empower stakeholders to make quicker decisions on acquisitions or dispositions. AI and machine learning also aid in analyzing tenant financial data to predict the likelihood of distress, thus allowing real estate professional to take proactive measures like renegotiating lease terms or finding replacement tenants, minimizing income loss. However, the accuracy and relevance of these insights are heavily reliant on the quality of data input by humans, and the final decisions always require human judgment.
Automation at scale
Automation reduces that burden by streamlining tasks like budgeting, reforecasting and reporting. Workflows become more consistent, accurate and scalable — especially across national portfolios. That
translates into better oversight, more accountability and greater transparency for stakeholders. Existing systems will streamline tasks like lease administration by sending rent reminders, processing payments and generating complex lease agreements, freeing up property managers to focus on tenant relations and strategic planning.
Data-driven insights from anywhere
Today’s technology enables real-time collaboration across teams involved in development projects, such as finance, construction, asset management, and leasing. For example, construction teams can use mobile devices to update project progress and budgets, data instantly accessible to finance for budget monitoring and to asset management and leasing teams to inform decisions on asset value and tenant acquisition. This enhanced visibility and data sharing supports broader initiatives and aligns operations with long-term goals
What comes next
As market complexity increases and margins tighten, Canadian asset managers are rethinking how technology supports their strategy. Tools that once offered incremental improvements are now becoming core to long-term value creation. The shift toward integrated digital asset management is already well underway. For firms looking to stay ahead of the curve — and on the Who’s Who list for years to come — adapting to this new normal is no longer optional. It’s how leaders lead.
ONTARIO’S OUTDATED property assessments are an added hitch for retail landlords now contemplating vacant anchor spaces in dozens of regional shopping centres throughout the province. The Hudson’s Bay Company’s (HBC) insolvency will soon empty out prime spaces in more than 70 major malls in seven Canadian provinces, in some cases leaving multiple shopping centres in the same city grappling to find new tenants.
Depending on how long that takes, operators of the nearly 30 affected malls in Alberta and British Columbia can at least expect a relatively quick and straightforward reflection of their altered circumstances on their property tax bills. Those two provinces enjoy the commonly acknowledged gold standard in property assessment practices, premised on annual updates of market values and the assessment roll.
Looking east, Ontario property tax is still apportioned to ratepayers from the lens of 2016 market dynamics and there has been no indication when a reassessment might occur. Five years have now elapsed since the provincial government postponed that exercise and, with that, a new four-year assessment cycle that had been scheduled to begin in 2021. A series of subsequent delays
followed — most recently in 2023, when the government announced it was undertaking a review of the assessment and property tax system.
“Since 2020, many shopping centres in Ontario have sold for less than half their assessed value,” observes Ryan Fagan, Head of property tax with property tax consulting firm, Ryan ULC. “Due to the provincial assessment freeze, current economic conditions do not impact property taxes. Shopping centres and their tenants continue to pay an unequitable high proportion of the property tax burden.”
TAX RELIEF MECHANISMS
Commercial ratepayers, in general, have increasingly been turning to the available channels to question the validity of their property assessments: an option to consult with Ontario’s assessment authority, the Municipal Property Assessment Corporation (MPAC), known as a request for reconsideration (RfR); and/or an appeal to the provincial Assessment Review Board (ARB).
Knowledgeable onlookers suggest retail landlords with newly empty anchor space may realize some collective benefits from sharing information and strategies for conferring with MPAC, and filing appeals where necessary and
possible. Robert Brazzell, Managing Director of Colliers Canada’s property tax services in Ontario, hypothesizes affected landlords could credibly argue the loss of business value related to an anchor tenant’s departure.
That would include factors such as an increase in non-recoverable operating expenses with the vacancy of the anchor space, and detrimental impacts on rental rates due to associated destabilization of other retail tenants and/or a decline in customer traffic. In some cases, loss of an anchor tenant might bump a property into a different category under MPAC’s definitions — for example, shifting it from a regional to a community mall — which would mean a more favourable assessment from a tax perspective.
“If you have demonstrable evidence that will illustrate how that loss of an anchor impacts the performance of your property, you’re going to want to get that in front of MPAC or in front of the Board,” Brazell says.
Meanwhile, a previously available relief mechanism has evaporated since the last time there was a large-scale, simultaneous exit of anchor tenants from Ontario’s malls. When Target departed the Canadian market in 2015, many ratepayers were able to claim the then-available vacant unit tax
rebate, which provided 30% compensation of property tax paid on a commercial unit that was vacant for 90 or more days in a tax year. Beginning in 2017, the Ontario government allowed municipalities to opt out of providing that rebate.
“It has been eliminated by all but a very few jurisdictions,” Brazzell notes. “So the two most straightforward approaches for dealing with this would be a reassessment, which we still don’t have, or the vacancy rebate, which is not available anymore.”
VARYING REASSESSMENT SCHEDULES
Quebec presents varying prospects for property tax relief at 10 malls HBC will be vacating (or possibly 12, if the company’s plan to continue operating in some locations is not successful). The province has a three-year assessment cycle, which resets on three different schedules depending on the region.
Quebec City, Laval and Sherbrooke are in the first year of the 2025-27 cycle, with assessments pegged to market values as of July 1, 2023. Montreal and surrounding municipalities are in the last year of the 2023-25 cycle, with new assessments for 2026 to be based on July 1, 2024 market values. Gatineau is at the midway point of
the 2024-26 cycle, with assessments for the next 2027-29 cycle to be based on market values as of July 1, 2025.
“To modify a value entered on the roll, an ‘event’ must occur under section 174 of the Act respecting municipal taxation, and the departure of an anchor tenant such as La Baie does not correspond to any event within the meaning of the law,” explains Roxanne Carrier, an évaluateur agréé (certified appraiser) and Associate with GDA services immobiliers intégrés in Quebec City. “In the past, we have, unfortunately, never seen tax relief for such situations.”
Even so, she speculates that this could be an expedient time for affected retail landlords in the Montreal region to negotiate with municipal assessors since the new assessment roll for 2026-28 won’t be formally registered until this fall.
“In the case of Quebec City, depending on what happens next, if the space has not been re-leased or redeveloped, this could be reflected in the value of the 2028-30 roll,” she adds.
In contrast, annual assessment cycles in Alberta and British Columbia unfurl with just six months of lead time. In both
provinces, assessments in any given year are pegged to market values on July 1 of the previous year.
UNCERTAIN ECONOMIC BACKDROP
Affected landlords will clearly be hoping anchor space vacancies are not long-lasting regardless of where they’re located, and Canada’s retail prospects were seen to be upbeat prior to the recent uncertainty tied to tariff threats and other United States government hostility. Retail was the best performing sector in the MSCIREALPAC Canada Property Index in 2024, delivering an average total return of 6.5%, while the regional and superregional mall subclass recorded an average total return of 6.1%, after negative returns earlier in the decade.
(See story, page 6)
“Retail was on the rebound in 2024. Consumers were back into the malls; the returns and rental rates were starting to move up again, especially within the regional malls,” affirms Raymond Wong, Vice President, research and data services, with Altus Group. “The challenge we have right now is potentially another economic slowdown, based on tariffs and people becoming a little bit more concerned about their job security.”
HBC’s departure is likely to present a differing degree of challenges across the entire scope of affected malls. For some, Wong predicts it may be an opportunity to fairly quickly exchange a financially tenuous tenant at below-market rent for more stable, lucrative replacements, while, for others, repositioning anchor space will be more arduous. However, it should be easier for everyone if CanadaU.S. tensions ease.
“Retailers and other companies do have a mid- to long-term strategy when they’re making decisions so I think it’s a matter of getting through the noise over the next, hopefully no more than three to six months,” Wong reflects. “The other thing to consider is that a lot of the landlords involved are experienced and large companies that have room for that adjustment. They know how to navigate to be able to weather the storm.”
That doesn’t mean they’re not interested in property tax fairness. Brazzell warns that extended gaps between reassessments — whether that’s three years in Quebec or nine years and counting in Ontario — risk bridging over economic downturns. Ontario’s delays have notably missed the
impact of the COVID-19 pandemic on the retail sector.
“By the time there’s a reassessment, they’re likely going to be performing well again,” Brazzell muses. “So they never got any relief. They missed an entire cycle that should have been reflected in terms of property taxes.”
“Owners and tenants of struggling shopping centres or half-vacant office buildings have no recourse but to pay excessive taxes in the current property tax legislative environment in Ontario,” Fagan concurs.
The most recent official word, in the Ontario government’s 2024 fall economic statement, is that a review begun in 2023 is still ongoing.
“The government is continuing to review the property assessment and taxation system, focusing on fairness, affordability, business competitiveness and modernized administration tools. Province-wide property tax reassessments will continue to be deferred until this work is complete,” the 2024 fall economic statement declares. “Through this review, constructive input has been received from municipalities, business representatives, property tax professionals and other stakeholders.”
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ELECTRIC AMBITIONS
Ontario Recharges Energy Efficiency Budget
ONTARIO’S ENERGY efficiency budget has been recharged with a pledged 12-year, $10.9-billion spending strategy, including the resumption of incentives for residential electricity customers that were largely cancelled when the current provincial government took office. A new three-year program cycle, beginning in 2025, also significantly boosts the funds available for commercial, industrial and institutional consumers.
As envisioned, a maximum of $3.2 billion could be available in any one of the four program cycles from 2025 to 2036, with up to 85% of that to be divided among provincewide programs for commercial, industrial, institutional and residential electricity consumers. Other funding envelopes are specifically geared to low-income electricity customers, on-reserve First Nations and various geographically targeted measures to
be offered through select local distribution companies (LDCs). There is also an opening for the budget and scope of programming to be readjusted after a scheduled comprehensive review in 2030.
This is a significant jump in spending from the Ontario government’s initial allocation for its 2021-24 conservation and demand management (CDM) framework. At that time, $456 million over four years was earmarked for province-wide programs for the commercial, industrial and institutional sectors — an amount that was then topped up with an extra $342 million to add programs for 2023 and 2024. Just $65.6 million over four years was made available for additional programs for customers of specified LDCs.
Now, the government is preparing for a forecasted 75% increase in provincial electricity demand by 2050, which will be needed to support anticipated population and
economic growth and the shift away from fossil-fuel-based heating and transportation. Energy efficiency is viewed as a costeffective means to take a bite out of some of the required investment in new generation and transmission capacity.
Stephen Lecce, Ontario’s Minister of Energy and Electrification, cited the recognized formula that $1 put towards energy efficiency yields a $2 avoidance in new generation costs as he laid out instructions for the Independent Electricity System Operator (IESO) last November.
“Electricity efficiency programs are an established part of Ontario’s energy mix and provide continued opportunities for electricity consumers to manage their electricity costs, to help cost-effectively meet system needs and provide economic opportunities for the network of companies involved in the delivery of energy efficiency
programs and services,” he wrote in a directive that outlines the programs and associated administrative oversight the IESO will be expected to deliver for the 2025-2036 period. “Programs under the Framework will help support energy affordability and customer choice for homes, competitiveness, productivity and cost management for businesses, as well as the province’s transition to a cleaner energy economy.”
Previously dubbed the CDM framework, the newly unveiled programming cycle has been renamed the electricity demand side management (eDSM) framework and given a tighter three-year run-time before the IESO is routinely scheduled to refresh and reset it. Perhaps most notably, the 2025-2027 eDSM framework will reintroduce incentives for residential customers to replace energy-using appliances/equipment and/or upgrade energy performance in their households.
“Any programs that were offered in 2024 will continue to be offered in 2025 and beyond. We’ll amp them up to reach more customers and then also continue to enhance them.”
Thus far, other announced changes affecting non-residential customers include new incentives targeting: cooling loads in data centres; solar photovoltaic generation for distributed energy resources (DER); energy management support in industrial facilities; and smart thermostats for small businesses. As well, the budget for LDCs’ specialized incentives — which could flow to either or both residential and non-residential customers within a particular geographic area — has been set at a minimum of $90 million and potentially as much as $150 million over the three-year period.
“Basically, any programs that were offered in 2024 will continue to be offered in 2025 and beyond. We’ll amp them up to reach more customers and then also continue to enhance them,” says Tam Wagner, the IESO’s Director of Demand Side Management. “We’ll continue to explore
what new technologies are available, where customer needs are and how they align with what the electricity system’s needs may be. What we’re looking at is not just maintaining the status quo, but continuing to evolve and approve programs.”
BUSINESS PROGRAMS
The retrofit program, which provides a set rebate amount for designated energy-saving equipment and systems, has now added two new categories of items for commercial/ institutional electricity customers and three for industrial customers.
All qualified business sector applicants are promised: up to $1,000 per kilowatt (kW) for the installation of a micro-generation solar photovoltaic (PV) system with a capacity of less than 10 kW; up to $860 per kW for installing small-to-midsize solar PV systems with a capacity of 10 kW to 1 megawatt
energymanagement
(1,000 kW); and up to $10,000 per unit for designated highefficiency air conditioners deployed in computer rooms.
Industrial customers can additionally receive up to $250,000 to subsidize the cost of an energy management information system.
Eligibility for the solar PV incentive will be contingent on whether the system can be connected to the electricity grid to augment distributed energy resources (DER). Generation systems with a capacity greater than 1 MW would also qualify for the incentive, but it would be capped at a maximum of $860,000.
“The solar PV incentive was [previously] offered in the Ottawa area under the local initiatives program and we saw a lot of interest and uptake there,” Wagner reports. “We’re now offering that measure province-wide for businesses to be able to offset their energy use through the installation of solar.”
The new incentive for industrial energy management information systems draws on federal funding through Natural Resources Canada’s (NRCan) initiative to promote decarbonization in industrial and manufacturing facilities. The same pot of NRCan funds also underpins a promised expansion of the IESO’s energy management program that is to include a resumption of support for remuneration of in-house energy managers in industrial facilities.
The latter highly popular element was phased out of the 20212024 CDM framework at the halfway mark, then replaced with facilitation of training, coaching and networking for various groups of participants aligned with different industry subsectors. Findings from the IESO’s commissioned program review, released last fall, reveal somewhat uneven engagement in the first year of the new approach.
It points to “many passive participants” who, evaluators conclude, were either intimidated by other group members’ perceived greater expertise or guarded about sharing information with contemporaries from competitive companies and organizations. Evaluators recommended reinstating funding for in-house energy managers, and the IESO committed to consider the recommendation in future program development.
“That is absolutely on our radar,” Wagner confirms. “We’ve been able to reintroduce the energy manager program to the industrial space, but we are considering it and stay tuned for more information about a similar [wider] reintroduction.”
As well, small businesses with fewer than 50 employees will now be encouraged to participate in demand response through the expansion of an incentive program initially introduced for residential electricity customers in 2023. It offers $75, via a prepaid virtual Mastercard, for first-time enrollment of Wi-Fi-enabled thermostats associated with central air conditioning, a rooftop unit or a heat pump that is part of a central air conditioning system. Enrollees can subsequently receive $20 for each additional year they continue in the program.
“We’re exploring commercial HVAC demand response also,” Wagner advises. “That’s work that’s underway around how best to be able to yield energy and peak demand savings associated with that.”
MULTIFAMILY INCENTIVES
The new program for residential energy efficiency improvements will be jointly administered with Enbridge Gas and rebate amounts have been outlined for 10 upgrade measures, including energy assessment, windows and doors, insulation, air sealing, hot water heaters, heat pumps, solar panels and battery energy storage. That list will be expanded to include energy-efficient appliances, including refrigerators and freezers, later this year.
“Generally, rebates could offset up to 30% of the cost of new upgrades,” states background information from the Ontario government. “Rebates will be paid within 30 to 60 days of an approved application.”
Condominium corporations and multifamily rental landlords may also be eligible for some of these new incentives. In other cases, the commercial retrofit or custom track programs may be deemed a better fit.
“Multifamily res sometimes straddles the residential and business programs,” Wagner acknowledges. “We are not trying to force them into one program or the other. We want to understand what the needs are and how we can evolve our programs to be responsive.”
Condo corporations and landlords of sub-metered multifamily buildings may want to provide residents with information about options for electricity account holders who qualify for the energy affordability program. They may be eligible for free installation of a range of energy efficiency improvements — covering everything from LED lightbulbs and clothes drying racks to window air conditioners and refrigerators and freezers — if their annual income falls within designated thresholds prorated to the number of household members.
Other electricity customers with higher, but still modest incomes may be eligible for a free energy saving kit, which contains items such as LED lightbulbs and night lights, weather stripping, block heater timers and water-efficient showerheads and faucet aerators.
More information about the Electricity Demand Side Management Framework can be found at www.ieso.ca/Sector-Participants/EnergyEfficiency/2025-2036-Electricity-Demand-Side-Management-Framework. More information about energy efficiency incentives can be found at www.saveonenergy.ca.
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CONSULTING ON CAPS
Toronto Prepares Building Emissions Performance Standards
By Barbara Carss
TORONTO COULD join the slate of North American jurisdictions that impose thresholds for allowable greenhouse gas (GHG) emissions from buildings sometime later this year. City staff are currently working on a proposed bylaw to set out those requirements, which is expected to be presented for Toronto Council’s consideration before the end of September. In the interim, building owners have been promised advance details and an opportunity for input.
“Our intention is to bring this out more broadly with a proposal of what we’re looking at — timeline, buildings that are in, who will be impacted and when — hopefully as early as May,” Sarah Rodrigues, a Senior Project Manager with the City’s Environment, Climate and Forestry division, reported earlier this winter during a webinar hosted by the Toronto chapter of the Urban Land Institute (ULI). “We want political buyin and engagement with impacted communi-
ties to get clear, realistic and achievable targets.”
The anticipated bylaw would be the instrument for implementing what’s known as building emissions performance standards (BEPS), and is part of a larger strategy to achieve citywide net-zero emissions by 2040. Buildings currently account for about 56% of Toronto’s GHG emissions output, with the remainder attributed to transportation (35%) and waste (9%).
Toronto’s inventory of 436,000+ singlefamily homes contributes about 54% of emissions from buildings or 30.3% of the total, but Council has decided to initially focus on the smaller complement of approximately 40,000 commercial, multiresidential, institutional and industrial buildings. Emissions targets and associated penalties for non-compliance would come into effect for these larger properties first before being rolled out to
the single-family sector.
Rodrigues and her colleague, Ana Maria Medina, another Senior Project Manager with the Environment, Climate and Forestry division, sketched out progress since Council conveyed those instructions last year. Thus far, a series of City staff working groups and stakeholder advisory committees have tackled the technical, financial and legal implications and practicalities of implementing BEPS.
The six advisory committees are drawn from sectors that will be subject to the standards, including low-rise and high-rise commercial/multifamily buildings and large institutional facilities, and those that will be key to reducing emissions, including retrofit service providers, the finance industry, utilities and other public agencies.
“It’s a targeted engagement approach, trying to leverage a lot of expertise,” Rodrigues said. “These are folks who will be impacted and who will be influential in the
success of this policy, who can help us understand what the policy should look like.”
They’re also weighing in on programs, policies and resources to support compliance, which have been promised as a companion piece to BEPS. That’s expected to include:
• incentives, building on some of the retrofit programs the City already offers;
• utility-level automation and data management efficiencies for collecting and transferring the energy and water-use data that building owners will have to upload to ENERGY STAR Portfolio Manager; and
• more flexibility for properties that may encounter undue structural, technological and/or financial difficulties to stay within designated emission thresholds.
Representatives from some of the advisory groups thus far involved in the process also participated in the webinar discussion, and particularly stressed the importance of this element of the BEPS agenda.
DATA COLLECTION OBSTACLES
Bryan Purcell, Vice President, Policy and Programs, with The Atmospheric Fund (TAF), noted that obtaining aggregated data from utilities continues to be a “pain point” for many of the landlords and public sector facility managers currently obliged to report energy and water use under Ontario’s longer standing and the City of Toronto’s more recent mandates.
Specific to Toronto, the City now requires monthly consumption totals for electricity, natural gas, district energy (if applicable) and water from buildings larger than 50,000 square feet. Data for the previous calendar year is to be uploaded to ENERGY STAR Portfolio Manager by July 2 each year.
However, Toronto Council has now agreed to a one-year postponement of the reporting requirements for buildings in the range of 10,000 to 50,000 square feet — thus moving the first annual deadline for submitting consumption data from July 2, 2025 to July 2, 2026. That’s after owners/managers of larger buildings were also given a short extension for submitting their first round of data last year, with the original July 2 deadline moved to Oct. 31, 2024.
“While progress is being made, automated solutions to providing aggregated whole-building utility data for buildings smaller than 4,645 square metres (50,000 square feet) but as large or larger than 929 square metres (10,000 square feet) are not yet in place,” a recent report from the Executive Director of the Environment, Climate and Forestry division acknowledges. “This [deadline extension] will allow additional time for: 1) the Environment, Climate and Forestry division to put in place a reporting help centre, which will provide direct support for property owners; and 2) water, electricity and natural gas utilities to streamline access to aggregated whole-building utility consumption data.”
That’s data that has to be retrieved from four different sources: Toronto Hydro, Enbridge Gas, Enwave District Energy and Toronto Water. Purcell stressed that automation at the utilities’ end would greatly reduce both administrative burden for building owners and the potential for erroneous data entry, while Medina advised that work toward those goals is in progress.
“The City is currently working on a project to automate our water data aggregation process to reduce the amount of time that it takes to provide whole-building water consumption data to building owners, and we aim to eventually enable direct uploading of water consumption data into ENERGY STAR Portfolio Manager,” she confirmed. “In the case of Toronto Hydro, we are aware that they are working on enabling automatic upload of monthly aggregated electricity consumption data
into our customers’ ENERGY STAR Portfolio Manager account.”
“I’m not sure where Enbridge is, at this point, with data aggregation and automation to ENERGY STAR Portfolio Manager, but I imagine that, as policy pushes forward, this is something that Enbridge will seriously need to consider, and Enwave will as well, as another provider of energy for large buildings downtown,” added Steven Pacifico, Executive Director of the Zero Carbon Buildings Accelerator Program with Toronto 2030 District, part of a global network of organizations advocating for decarbonization of the built environment.
ACCOMPANYING SUPPORTS PRIORITIZED
Beyond the cost, time and labour for reporting, there is perhaps even greater unease about the potential for financial penalties if emissions from buildings surpass what the City dictates to be the allowable threshold. In New York City, for example, the fine has been set at USD $268 (CAD $380) per tonne for emissions exceeding the established limit.
“What kind of penalties is the City considering for noncompliance, and would there be alternative compliance pathways for complying with the bylaw?” asked Caroline Karvonen, Senior Director, Sustainability and Stakeholder Relations, with the Building Owners and Managers Association (BOMA) of Greater Toronto.
“Right now, with everything that’s happening in the market, a lot of B and C class assets, especially commercial office, can be distressed and experiencing vacancy. An alternative compliance pathway will be important for them to help comply with the bylaw” Pacifico observed. “We’re getting a lot of questions around the requirements. We’re waiting to see a little bit more meat on the policy.”
More details are promised as part of the upcoming consultation period. In turn, feedback from the consultation will be considered and potentially incorporated into the plan that will be presented to Council sometime this summer. There’s also a recognition that some buildings will face greater costs to get within prescribed emission thresholds, which might be balanced with commensurate leniency, extra financial support or some combination of those two measures.
“We have the benefit of having access to the lessons learned and emerging best practices from jurisdictions that are ahead of us in this process, which we are also leveraging to inform in the consideration of alternative compliance pathways,” Medina said.
That group includes eight large cities in the United States, including New York, Boston, Seattle, Denver and Washington, D.C., that have already adopted emissions standards and dozens more that are on track to do so. Rodrigues highlighted various actions within those cities that provide extra supports for some designated types of buildings.
She reiterated that Toronto policy drafters are well aware of the massive upfront investment in existing buildings that will be required to meet the net-zero target, but they also want to underscore that “beneficial electrification” delivers paybacks in cost savings and improved asset value and resiliency.
“We know that we lean on a lot of other partnerships and levels of government to try to provide some incentives, rebates and really try to cultivate an environment in which it’s a bit more feasible for folks to do this,” Rodrigues said. “We also want to make sure people are planning their retrofits appropriately to realize the benefits.”.
More information about the City of Toronto’s consultation process can be found at www.toronto.ca/services-payments/water-environment/net-zerohomes-buildings/emissions-performance-standards.
CROSS-BORDER AMBIGUITY
Refrigerant Restrictions Differ in Canada and the U.S.
AN INTERNATIONAL agreement to phase out hydrofluorocarbons (HFCs) with high global warming potential (GWP) ironically poses some complications for Canadian building owners contemplating the replacement of gas-fired boilers. Industry insiders warn of market uncertainties because regulators in Canada and the United States are out of sync in banning the R-410A refrigerant that’s currently a mainstay of variable refrigerant flow (VRF) heat pump systems, while Canada has been slower to provide guidance on mildly flammable, lower-GWP alternatives.
Both countries are among the 163 national signatories of the Kigali amendment to the Montreal Protocol on substances that deplete the ozone layer, which aims to curb HFC consumption by 85% relative to the average for the baseline years of 2011, 2012 and 2013 by 2036. That involves a phased reduction of the supply of high-GWP refrigerants into the market and a series of prohibitions on equipment and systems that use HFCs.
Initially, Kigali amendment signatories from countries with developed economies were expected to cut the availability of new HFC refrigerants by 10%, but a more significant threshold, requiring a 40% reduction, kicked in for 2024.
“We’re definitely progressing well with our target,” Michel Gauvin, Head of Ozone layer protection programs with Environment and Climate Change Canada (ECCC) reported as 2024 came to an end, during a webinar sponsored by the Heating, Refrigeration and
Air Conditioning Institute (HRAI) of Canada. Jan. 1, 2025 brought new, but varying restrictions on both sides of the Canada-U.S. border. Canada now prohibits the manufacture or import of chillers that employ refrigerants with GWP more than 750 times greater than carbon dioxide, but the schedule to address VRF heat pump systems is still imprecisely pegged for sometime between 2030 and 2036.
Meanwhile, the U.S. completely halted manufacture, import or installation of any system with capacity below 65,000 British thermal units (BTUs) that uses R-410A (which has a GWP 2,088 times greater than CO2) after Dec. 31, 2024.
There’s speculation that the new U.S. restrictions could end up applying in Canada by default since manufacturers will see little motive to maintain product lines for the smaller scale of the market here. Alternatively, there is concern that Canada could become a dumping ground for unsold U.S. inventory and/or a target market for overseas manufacturers of systems that are of questionable quality.
Also speaking during the HRAI webinar, Pushpinder Rana, a Product Director with Mitsubishi Canada’s HVAC division who serves as chair of the Canadian Standards Association (CSA) committee for CSA B52, the mechanical refrigeration code, noted that reputable manufacturers are now largely focused on developing product lines that use lower-GWP refrigerants, which typically have an A2L classification to indicate that they are mildly flammable. At the same time, there has
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been an influx of relatively unknown brands of heat pumps that he categorizes as “lowtier” into both the U.S. and Canadian markets.
“We have a misalignment with the U.S. and this is where we have ambiguities,” Rana asserted. “There’s a possibility that low-tier heat pumps could still come freely to Canada [until the eventual prohibition]. How would it impact the market, the quality of product and reputable manufacturers that are pushing to move to A2L heat pumps?”
Gauvin acknowledged that his Ministry has been hearing similar concerns, but also pointed to what he called mostly positive feedback from the government’s consultation on the regulations for ozone depleting substances and halocarbon alternatives (known as ODSHAR) conducted earlier in 2024.
“We’ve received quite a few comments over the past year-and-a-half asking if and when ECCC is planning to align with the rules in the U.S. so that’s something that we’re looking into,” he said. “We’ve identified some special needs, but, generally speaking, many of the stakeholders in the refrigeration and air conditioning sector noted that transition to lower-GWP refrigerants is generally progressing well with existing controls.”
With the embargo on new chillers using high-GWP refrigerants, most Canadian provinces and territories have now adopted references to the most recent edition of CSA B52 into their building codes, or are expected to do so within the next few months. That will allow for installations that use A2L refrigerants, including R-32 in VRF heat pump systems.
There will also still be some flexibility to purchase or import chillers that do not comply with ODSHAR if Environment and Climate Change Canada deems that it serves an essential purpose for health, safety or the “good functioning of society” and there are no economically or technologically viable alternatives. High-GWP refrigerants will still be available for existing chillers and other cooling systems, but the phase-down in supply is continuing, with the goal of reducing it to 30% of baseline levels by 2029.
