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VOL. 40 NO.4
WINTER 2025/2026
Editor-in-Chief Barbara Carss barbc@mediaedge.ca
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editor’snote
AS A TODDLER, my niece was adamant that stew was yucky, but she found it delicious when her parents called it “vegetables with meat”. Similarly, much of the most vehement recent backlash against ESG seems to be based on notions attached to the label rather than on its substantive ingredients. The debate should tip back into ESG proponents’ favour as they continue to prove that it pairs palatably with innovation, risk management and economic growth.
ESG is shorthand for some big-picture objectives — such as reducing greenhouse gas (GHG) emissions, broadening workforce diversity and conducting business transparently — that come with an associated emphasis on identifying best practices, verifying performance and comparing competitors in the marketplace. And it’s grounded in increasingly sophisticated data gathering and analytics to link inputs to outcomes, test hypotheses, draw conclusions and plot out future progress. What’s not to like?
In this issue, we dig into the vegetables and meat of the commercial real estate industry’s evolving outlook on sustainable investment, management and operations. Energy cost savings remain a strong driver, but several other factors exert influence. There are spinoffs for tenant satisfaction, asset value and health and well-being, and mounting pressure from investors, insurers and regulators.
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Although they’re having a moment in the United States, ESG detractors aren’t so plentiful in many of the nations in Europe and Asia Pacific that the Canadian government has targeted for expanded trade partnerships. As we report, plans to implement a voluntary sustainable investment framework were reconfirmed in the 2025 federal budget, which could provide another measure of assurance for institutional investors like those subscribing to the GRESB global benchmark for the ESG performance of commercial real estate portfolios.
We also chart evidence of some pullback from voluntary accountability and target-setting exercises. Canadian GRESB participation declined this year — dipping from 85 reporting entities in 2024 to 78 in 2025 — and four real estate organizations are among the 21 Canadian companies that have withdrawn their net-zero commitments through the Science Based Targets initiative. (There are still seven real estate companies among the 146 Canadian organizations with registered commitments.)
That could be reflective of the emerging phenomenon of greenhushing, which Benjamin Shinewald, President and Chief Executive Officer of the Building Owners and Managers Association (BOMA) of Canada highlighted while flagging noteworthy trends and issues for delegates at BOMA Canada’s national conference earlier this fall.
“Greenwashing is doing nothing special for the environment and telling the world that you’re environmental champions. Greenhushing is the opposite of that,” he advised. “Greenhushing is actually doing meaningful work to help sustainability and then being told: Shh…don’t tell anybody. It’s the wrong time; we’ll do that, but politics or economics or whatever inhibits us from telling this awesome story.”
Yet, from the perspective of another social divide — between extroverts and introverts — quiet action should not be mistaken for weakness. Solid results will get attention from those who want to replicate them, with or without gregarious accompaniment.
Barbara Carss barbc@mediaedge.ca
Focus: Green Buildings, Sustainable Management & Operations
16 Diversion Dilemma: ICI organic waste stakeholders stuck in a loop of hesitancy.
52 Nurturing Career Growth: Emerging leaders contemplate CRE’s professional culture.
56 Revealing Reporting: Non-profits to share more info with Canada Revenue Agency.
60 Rank Neglect: Military housing battles fatigue.
- Douglas
CAPITAL APPEAL
Real Estate Investors Figure in Canadian Government’s Ambitions
By Barbara Carss
COMMERCIAL REAL ESTATE is a channel for some of the capital the Canadian government is strategizing to attract via enticements unveiled in the recently released 2025 federal budget. That’s to be targeted through incentives, financial instruments and regulatory adjustments.
“Budget 2025 is a plan to catalyze investments from provinces, territories, municipalities, Indigenous communities and the private sector,” Finance Minister FrançoisPhilippe Champagne advised during his Nov. 4 budget address. “With this plan, in five years, we will see one trillion dollars in total investments in this country.”
Measures that could spur contributions from, or activity in, the commercial real estate sector include:
• a $20-billion top-up to annual Canada Mortgage Bond issuance, to be exclusively applied as CMHCbacked debt security for multifamily development;
• $6 billion over 10 years for the private sector stream of the new Build Communities Strong Fund, to support “regionally significant” projects, including large building retrofits and climate resilience initiatives, that involve private sector investment;
• a $10-billion expansion of Canada Infrastructure Bank’s spending allocation, taking it up to $45 billion;
• temporary 100% capital cost allowance (CCA) in the first year for manufacturing and processing buildings acquired after Nov. 4, 2025 and in use by Dec. 31, 2029;
• replacement of statutory limits on federally regulated insurers’ and financial institutions’ ability to invest in commercial loans and real property with promised “more flexible guidance” from the Office of the Superintendent of Financial Institutions (OFSI);
• new flexibility for the First Nations Finance Authority to lend to Indigenous special purpose vehicles to gain equity stakes in economic and resource development projects; and
• promised “new ways to attract” private sector investment in Canadian airports, potentially related to lease extensions, ground lease rent formulas and allowing more economic development activities on airport lands.
There are implications for commercial real estate in the government’s courting of pension funds, reiterated support of sustainable investment guidelines and aspirations for
“Budget 2025 is a plan to catalyze investments from provinces, territories, municipalities, Indigenous communities and the private sector.”
economic growth tied to cleantech, the energy transition and artificial intelligence (AI).
The rising profile of data centres in the alternative asset class, robust returns on infrastructure and real estate market bifurcation in favour of high-performance buildings could all complement the government’s ambitions. Evidence that institutional investors — particularly those in Canada, Europe and Asia Pacific — remain committed to ESG (environmental, social, governance) principles could also bode well for the goal of doubling exports to trading partners outside the United States by 2035.
SUSTAINABLE INVESTMENT CONTEXT
The budget document confirms that Canada is proceeding with plans to implement a voluntary sustainable investment framework, known as a taxonomy, to give financial market participants a standardized means to categorize and verify investment that is compatible with decarbonization targets and does not undermine environmental, social and Indigenous objectives. The previous iteration of the government launched work on the framework and identified buildings as one of six priority sectors for investment.
It’s now expected that an arm’s length, thirdparty organization with the expertise to fill out the details will be selected before the end of this year. As a next step, the government indicates it will explore the issuance of green and transition bonds aligned with various categories of investment in the taxonomy. There is also a pledge to engage the provinces
and territories to work toward standardized climate disclosure metrics that are in sync with international standards.
The budget announces a pending tweak to the Building Canada Act to require that the public register of projects deemed to be of national interest contains information to describe how each of those projects can contribute to clean growth and climate change action. The government has additionally committed to “develop and communicate new metrics to show how companies and households are reducing their carbon footprint, how the clean economy is growing and how exports are tracking to achieve world-leading emissions intensity”.
Many institutional investors are on a similar track. The GRESB global assessment and benchmark of ESG performance of commercial real estate portfolios counts them in roughly 150 investor members that have full access to the data that 2,382 real estate entities and 805 infrastructure entities, worldwide, reported this year. (See story, page 34) Roxana van den Berg, GRESB’s Chief Product Officer, stresses that this group is focused on long-term strategies and value creation tied to sustainability and resilience.
“We’ve seen some unprecedented shifts in the way that capital allocations work and we’ve seen some bold statements coming from large institutional investors, primarily from Europe, in the way that they choose to allocate capital,” she observes in an online commentary,
budgetarylevers
released earlier this fall in tandem with the 2025 benchmark results. “Institutional investors have a lot of power in defining the dynamics. They’re the ones that innovate a lot, especially in the sustainable finance sector where they’re accessing capital rooted into the idea that sustainable investments are actually here to stay.”
Standardized measurement, verification and disclosure are increasingly in demand as a means to send consistent signals to the market about risk exposure and how sustainable performance translates into value. Notably, Prime Minister Mark Carney played a key role in the genesis of one such framework, through the Task Force on Climate-related Financial Disclosures (TCFD), during his tenure as chair of the international Financial Stability Board.
“Finance and sustainability are merging in terms of accounting. When we talk about physical or transitional risk around decarbonization, we are essentially being forced to understand financial reporting,”
Karen Jalon, Vice President, sustainability, energy and smart technology, with Cadillac Fairview Corporation, reflected during a panel discussion at the Building Owners and
Managers Association (BOMA) of Canada’s annual conference in September. “What we are seeing, too, is the request for data from our direct stakeholders: investors; our co-owners; our owner (Ontario Teachers’ Pension Plan, a GRESB investor member); and tenants.”
TAX PERKS AND INCENTIVES
Newly available accelerated capital cost allowance (CCA) for manufacturing and processing buildings, including data centres, adds to the existing slate of CCA-related tax perks for energy-efficient, cleantech and data management equipment announced in recent years. Until now, the annual deduction rate has been 10% if at least 90% of the building area is used for manufacturing/processing purposes, and 4% if more than 10% of the space houses non-manufacturing/processing functions.
As of Nov. 4, 2025, owners who acquire or commission newly constructed manufacturing/processing buildings can claim 100% depreciation on the asset in the first tax year it is operational. Immediate expensing will also be available for expansions and alterations to buildings owned prior to budget day.
In both cases, at least 90% of a building’s area must be used for manufacturing or processing functions to qualify. For acquisitions, taxpayers will not be eligible if they or a non-arm’s length entity previously owned the building or if the property has been transferred to them on a tax-deferred basis.
Full CCA can be claimed for qualifying buildings and expansions that are operational in the tax years from 2025 to 2029. After that, the incentive will be incrementally reduced — allowing for 75% depreciation in 2030 and 2031, and 55% in the 2032 and 2033 tax years.
Other budget measures could potentially flow through to demand for data centres and life sciences facilities. Nearly $926 million over five years has been earmarked to support the development of “large-scale sovereign public AI infrastructure” meant to provide capacity for public and private research. As well, the Business Development Bank of Canada will be allocated $1 billion to launch the Venture and Growth Capital Catalyst Initiative, intended to incentivize pension funds and other institutional investors to augment private venture capital for the technology and life sciences sectors.
Some onlookers express skepticism about institutional investors’ willingness to participate. On stage as a keynote speaker at BOMA Canada’s national conference, David Cohen, the former United States ambassador to Canada, tallied some competitive weaknesses — noting that Canada has the lowest rate of GDP growth and the second highest unemployment rate among G7 nations, and that Canadian pension funds’ domestic asset allocation has dropped from 75 to 80% 20 years ago to about 12% today.
“They’re going to go where the returns are. Canadian pension funds are not going to invest in Canadian assets just because Prime Minister Carney is asking,” Cohen said. “About half of Canadian pension fund assets are now invested in United States assets.”
However, his analysis leaves out other points that the federal budget document highlights. Canada has:
• the lowest marginal effective tax rate (METR) in the G7;
• the lowest debt-to-GDP ratio in the G7; and
• the second lowest deficit-to-GDP ratio in the G7 (after Japan), at 2.2 versus 7.4 in the U.S..
Nor does Cohen’s critique acknowledge the switch to active management strategies, occurring in the early 2000s, that has propelled Canada’s largest pension funds (known as the Maple 8) to be ranked among the world’s 100 largest. In 2023, for example, Canada Pension Plan (one of the 10 largest pension plans globally) reported that its fund had grown to $570 billion from $100 billion in 2006 — an increase of 470% over 17 years. In that context, the percentage drop in domestic allocations is far less dramatic than implied.
FEDS SET TO DILUTE ANTI-GREENWASHING RULES
Marketers could soon have more leeway to make claims about the environmental benefits of products. The 2025 federal budget announces the Canadian government’s intention to revise instructions guiding how the Competition Tribunal assesses what constitutes greenwashing in marketing messaging.
Proposed future amendments to the Competition Act will remove the requirement for businesses to prove that claimed environmental benefits can be validated through internationally recognized standards and methodologies. As well, it’s proposed that third parties not competitively affected by a company’s marketing efforts would lose their current ability to directly bring cases to the Competition Tribunal to dispute environmental claims.
“These ‘greenwashing’ provisions are creating investment uncertainty and having the opposite of the desired effect with some parties slowing or reversing efforts to protect the environment,” the budget document states.
A coalition of 25 Canadian industry and business associations voiced their opposition to those two provisions during the 2024 public consultations prior to their enactment. The group — which included representation from the oil and gas, agriculture, food and forestry sectors, along with the Canadian Roofing Contractors Association, the Canadian Chamber of Commerce and the Business Council of British Columbia — argued that there is no single set of international standards that can be used to gauge the accuracy of claims, and that the requirement does not allow for emerging innovation.
They also expressed concern about the “reverse onus” aspect of allowing third parties to initiate proceedings without necessarily having a meritorious case, suggesting that it leaves businesses open to harassment.
Environmental advocacy groups such as the David Suzuki Foundation and Environmental Defence have reacted negatively to the budget announcement — calling it a “step in the wrong direction” that would “weaken environmental standards.”
“We are well aware that industry has been lobbying against these rules because they are effective at stopping companies from making unbacked claims,” submits Keith Brooks, Programs Director with Environment Defence. “The government should hold firm rather than bow to industry pressure.”
INVESTOR MOTIVATIONS
Industry insiders participating in a September panel discussion at a NAIOP North American convention in Toronto shared some thoughts on where it could be attractive to invest now. They concurred that institutional investors are likely to take a fairly constrained approach to new commercial real estate development in the near future as they continue to absorb interest rate reverberations and suss out geopolitical uncertainty. At the same time, they’ve become more active on the lending front.
Milos Dajic, Head of Canadian investments with Oxford Properties Group, the real estate arm of the Ontario Municipal Employees Retirement System (OMERS) pension plan, recounted how debt gained stature as a business line to balance out slipping values and income in the built portfolio.
“I am certain it was helpful to a lot of portfolios as they were looking around the world at investment opportunities. Credit is going to continue to be a big part of our story. I’d say 50% of our deals right now are going to go into credit,” he said. “It’s not just the income; it’s also how we can gain exposure to sectors
that we otherwise don’t invest in. We typically lead with credit as a more structured, safer bet. If and when we get comfortable with that, we may or may not go into the equity.”
“Private credit is, for sure, a rapidly scaling source of funding. The general dynamic that is happening is that capital is consolidating and, inherently, deals will need to get bigger for that consolidated capital to be placed efficiently,” added Michael Brodie, Managing Director of real estate investment banking with BMO Capital Markets. “There are capacity limits with bank money so there is a need for these private structures.”
Data centres are one example of where Oxford has been an active lender, but has not yet made an equity investment. Although data centres are both integral infrastructure for the kind of economic growth the Canadian government envisions and an asset type identified to hold promise for the commercial real estate sector, panellists enumerated some challenges for prospective investors.
On top of the increasingly arduous logistics of securing adequate energy supply and grid connections, Danny Kaufman, a
– REMI Network
budgetarylevers
Senior Managing Director with JLL, noted that there is a miniscule pool of potential purchasers for the “absolute magnitude” of such developments, so investors must look at them as a perpetual vehicle. Illustrative of that point, Brodie gave the example of a recent deal that required $30 billion in financing for one U.S.-based facility.
“The scale is going to limit how many people can actually play in this asset class,” he cautioned.
Other trends could line up with the goal of encouraging infrastructure investment in general. Recent MSCI research points to an average annual rolling return of 11.8% between Q1 2009 and Q1 2025, but finds a greater divergence in performance across the four analyzed asset types — renewable energy, water, airports and public facilities — and from country-to-country. Regulatory regimes and market structures are considered an influential factor in the latter case, along with the differing quotients of each asset type within each country.
“Findings suggest a substantial opportunity for sector-based allocation strategies in infrastructure investing and highlight the importance of using granular data to examine performance and better inform investors making allocation decisions in real assets,” concludes Will Robson, MSCI’s Executive Director of research.
Meanwhile, investors and asset managers have been salving recent wounds and adjusting their game plans.
“Globally, we all went on that risk curve, chasing total return. When the rate environment flipped on us, overnight
REGULATORY SANDBOXES SLATED
FOR FEDERAL PLAYBOOK
The Canadian government plans to broaden the scope for innovation and pilot projects via specially tailored mechanisms known as regulatory sandboxes. The 2025 federal budget announces pending legislation to give all Ministers authority to temporarily override existing regulatory constraints to allow for “testing of products, services, processes or new regulatory approaches”.
This follows after the 2024 budget signalled the then iteration of the government would take similar action. Through regulatory sandboxes, products and services can be tested in the marketplace under controlled, time-limited conditions, giving regulators a real-scenario reading of their performance and spinoff consequences for safety, the environment, consumer protection, etc.
Background information on the government of Canada’s website maintains the process will help regulators keep pace with changing technologies and business practices, and safely decide what kinds of permanent regulatory framework or regulatory changes may be needed.
Proposed amendments to the Red Tape Reduction Act and Energy Efficiency Act would open the way for that to happen. The City of Toronto is also considering a similar approach to test emerging types of products and services that are not currently addressed in the municipal business licensing bylaw.
“Regulatory sandboxes must protect the health, safety, security and well-being of Canadians and of the environment,” the government of Canada’s website states. “A regulatory sandbox may not be appropriate or possible in all circumstances and regulators should factor this into their decision before running a regulatory sandbox.”
seemingly, a lot of that no longer pencils. We were somewhat caught with a portfolio with an oversized development book not producing enough cash flow,” Dajic acknowledged. “Certainly, in the next three to five years, future development acquisitions will probably be highly, highly, highly selective, very much tilted toward income.”
Brodie describes a shift away from large core open-ended funds into a more targeted deployment of capital. Closed-end
funds focused on one asset class and specific regions, are now more prevalent. So, too, are large anchor investors accounting for 30 to 40% of capital raised.
“It’s becoming much more bespoke,” he said. “A lot of money was put out leading up to this rethink, and a lot of lessons were learned by some of these money managers in terms of where putting their money worked and where they were overstretched in some kind of way.”
– REMI Network
is Modernizing Condo Living SMART ACCESS
Walk into any residential tower in Toronto, Vancouver, or Montreal, and you’ll notice something different. Gone are the clunky intercoms and the inevitable fumbling for keys while juggling groceries in a January deep-freeze. Instead, residents simply tap their phone against a sleek reader, and they’re in. This shift toward smart access control represents more than just a technological upgrade; it is fundamentally changing how Canadians experience condo living.
THE RISE OF SMART LIVING
The transformation couldn’t come at a better time. Traditional lockand-key systems no longer meet the complex demands of modern property management. Consider the challenges: 52% of property managers report an increased workload over the past year. This administrative burden, often felt by condo boards and their management teams, is a key driver of technological adoption, which is why 68% of property managers plan to invest in technology in the next year.
This shift also reflects broader changes in how we live and work. Many condo dwellers now run businesses from their units or maintain flexible schedules. This creates a service gap, as nearly 40% of residents have difficulty reaching property management companies outside business hours. Smart access systems solve this problem by enabling 24/7 self-service capabilities, allowing residents to manage their own access needs—from guest entry to booking amenities—without needing to contact the office.
THE NEW RESIDENT EXPERIENCE
The market demand for these features is undeniable. According to market data compiled by Zipdo, 62% of residents prefer properties with smart home features, and smart access forms the backbone of these digital amenities for any modern condo community.
This technology is particularly adept at addressing uniquely Canadian challenges. In cities where harsh winters can make coordinating access tricky, residents can send temporary digital keys to holiday visitors, maintenance crews, or delivery drivers. Picture this: it’s minus twenty, and your parents are visiting while you’re stuck at work. With smart access, you can grant them entry remotely, track when they arrive, and ensure they can access guest parking—all from your phone.
For Millennial and Gen Z residents, this is not a luxury; it is an expectation. Seamless smart access is as essential as reliable WiFi.
THE MODERN DOOR INTERCOM
A core part of this new experience is the evolution of the door intercom. With technology like Salto’s XS4 Com, residents no longer have to buzz visitors through a staticky, audio-only system. Instead, this modern solution leverages the users’ own smartphones for clear, convenient two-way communication. The guest simply scans a QR code mounted outside of the building and the resident receives a video call from that visitor. They can see who it is and grant, or deny, access with a single tap—
whether they’re on their couch, at the office, or vacationing in Muskoka.
Companies like Salto, whose technology is in use from Edmonton’s SouthPark Whyte to London, Ontario’s WEST5 development, are creating ecosystems where every access point operates seamlessly through a single platform.
Preston Grutzmacher, Residential Business Leader at Salto North America, puts it simply: “We don’t believe that a combination of multiple credentials that require you to swipe, tap, and use a key offers a great user experience and certainly doesn’t maximize security.”
BENEFITS FOR PROPERTY MANAGERS AND OWNERS
Beyond resident satisfaction, the operational benefits for property managers and the condo corporations they serve are profound. The right technology streamlines condo management from the ground up. Move-in and move-out administration, once a manual process of key exchanges and paperwork, can be automated through integration with property management software.
For companies overseeing large portfolios, centralized cloud-based management offers unprecedented efficiency. This directly addresses a major challenge, as 29% of property owners report difficulty managing multiple properties efficiently. Smart access platforms solve this with unified dashboards and remote management capabilities, allowing a single property manager to oversee multiple buildings for their respective condo boards.
Security is also significantly enhanced. Every access event creates an auditable digital trail, allowing managers to track exactly who entered which areas and when, improving accountability and peace of mind for the entire community. Ultimately, the business case for a condo board is clear:
• Owner Satisfaction & Property Value: With 37% of property managers citing resident retention as their biggest challenge, smart systems that enhance the living experience have a direct impact. Happy owners and residents
lead to a stable community and help protect and increase property values.
• Reputation & Desirability: In competitive markets, these upgrades help properties stand out. Given that 47% of residents report that online reviews influence their property choice, buildings with modern, convenient smart access generate better reviews, which supports higher resale values.
SMART ACCESS AND THE FUTURE OF CONDO LIVING
Looking ahead, the integration possibilities are nearly endless. Systems like Salto Homelok can integrate with elevator controls, amenity booking platforms, parking management, and energy-saving tools. As 78% of property managers believe automation improves operational efficiency, every new integration creates value for the property. These systems also contribute to sustainability goals by eliminating the waste and cost of manufacturing and replacing plastic key cards or fobs.
As Canadian cities continue to evolve, smart access technology is moving from a “nice-to-have” to a necessity. Buildings without these systems risk falling behind, potentially affecting property values and market desirability.
For residents, owners, property managers, and condo boards alike, the question isn’t whether to adopt smart access technology, but how quickly they can implement it. With 63% of property managers already using property management software and the majority planning further tech investments, those still fumbling with keys will find themselves increasingly out of step with modern expectations. The future of residential condo living is smart, secure, and seamlessly connected.
Rental Housing Sector Assesses Budget 2025 DWELLING ON THE POSSIBILITIES budgetarylevers
By Erin Ruddy
CANADA’S 2025 federal budget signals a renewed push to accelerate housing construction, placing housing supply at the centre of the federal economic agenda. Yet, apartment owners and developers see it as mixed picture. Some measures look like meaningful support, others raise questions about long-term viability and whether they go far enough to truly incentivize new rental housing.
The new Build Communities Strong Fund, aimed at supporting housing-enabling infrastructure is considered one of the more notable announcements in Budget 2025. This fund will be available to provinces and territories that agree to cost-match federal contributions and commit to reducing development cost charges (DCCs) and avoiding other taxes that hinder housing supply.
David Hutniak, Chief Executive Officer of LandlordBC, welcomes the announcement, and expresses support for the continued funding of key Canada Mortgage and Housing Corporation (CMHC) programs, including the Apartment Construction Loan Program (ACLP), which will remain in place over the next five years.
Although some in the sector had hoped for increased funding to the ACLP, Hutniak sees the renewed commitment as a positive sign for future development. That sign is further reinforced by the budget’s allocation of $13 billion over five years to the Build Canada Homes initiative — underscoring the federal government’s intent to scale up housing supply through sustained investment. Complementing these measures, financing access is set to improve with the planned increase in the Canada Mortgage Bond annual issuance limit to $80 billion starting in 2026. This change is expected to expand access to cost-effective mortgage funding for lenders, ultimately supporting the rental housing sector by lowering borrowing costs and improving project viability.
In a move welcomed by many in the industry, the budget eliminates the Underused Housing Tax (UHT) as of the 2025 calendar year and defers the bare trust reporting requirement, including for nominee companies. Introduced in 2022, the UHT imposed a 1% annual tax on vacant or underused housing, primarily targeting foreign owners, but also affecting Canadians who hold property through trusts, corporations or partnerships.
Hutniak calls its removal “a good policy move,” citing the administrative burden and unintended consequences for domestic owners.
IMMIGRATION ADJUSTMENTS
The budget’s immigration measures are expected to have a contradictory impact in some markets. The newly announced 2026–2028 Immigration Levels Plan will cap permanent resident admissions at 380,000 annually and reduce student visa issuance to 155,000 in 2026 —down from approximately 306,000 under the previous plan.
These changes may ease pressure on rental demand, leading to higher vacancies and lower asking rents, which is certainly good news for renters. However, Hutniak and others suggest they could further erode the business case for new purpose-built rental construction.
“We need to find the right balance so that we have a cost structure conducive to building new rental housing for the long term,” Hutniak maintains.
Viler Lika, Founder and Chief Executive Officer of the rental platform, SingleKey, also foresees that lowered immigration targets could unintentionally squeeze small landlords who rely on student renters for income in university towns.
“While it’s great news for rents, with fewer international students, many of these properties may no longer be financially
viable,” he says. “Immigration cuts will ease rental demand in the short term but could lead to increased vacancies or even landlords exiting the market.”
SUPPLY LUBRICANT
Nevertheless, industry leaders offer some cautious praise. Tony Irwin, President of Rental Housing Canada (RHC), is keen to translate federal investments into tangible outcomes.
“The 2025 federal budget includes encouraging steps toward addressing Canada’s housing challenges,” he says. “Rental Housing Canada and its members are ready to ensure these federal investments lead to more rental housing construction, faster approvals and lower costs. These are the outcomes Canadians expect, and our sector is ready to deliver.”
“The government’s commitment to accelerate housing construction marks a real turning point,” Lika adds. “For years, developers have focused on condos, but now, with new incentives like tax breaks, lower interest rates and longer amortization periods, we’re seeing a major shift toward purpose-built rentals. That means more supply, more options for renters and cooling of rental prices.”
The government also intends to discontinue plans for the Canada Secondary Suite Loan Program, which was never actually formally introduced. For Lika, this isn’t a moot point.
“With housing affordability still a major concern, encouraging homeowners to create secondary units could have been an efficient way to boost rental supply quickly and affordably, but, compared to new measures put on the table, this would not have moved the needle on housing supply in any meaningful way.”
Erin Ruddy is the Editor of Canadian Apartment.
G OING STRONG FOR
50 YEARS
DIVERSION DILEMMA
ICI Organic Waste Stakeholders Stuck in a Loop of Hesitancy
The Circular Innovation Council, a research and advocacy organization also involved in piloting approaches for maximizing resource efficiency and product life cycles, recently produced a report examining the barriers to, and opportunities for, organic waste diversion in the industrial, commercial and institutional (ICI) sector. The following is an excerpt – Editor.
CANADA’S INDUSTRIAL, commercial and institutional (ICI) sector produces an estimated 14 million tonnes of food and organic waste annually, much of which flows into landfills and significantly contributes to methane emissions from solid waste. Low disposal costs, few regulatory constraints and a lack of incentives to shift behaviour are all contributing factors to the sector’s modest diversion rate.
The food economy and waste management systems are interdependent, yet operate as distinct networks involving
government bodies, businesses and industry stakeholders. Each stakeholder in the system has its own priorities and constraints, influencing how organics diversion solutions are implemented.
Most of the Canadian municipalities that provide organics collection services do so only for the residential sector. Where collection and diversion services are available for the ICI sector, they are predominately through private waste service providers on a fee-for-service basis.
The waste management industry
typically charges premium fees for organics collection, based on requirements for additional handling and specialized infrastructure, frequent pickups and skilled labour. Thus far, there has been little opportunity to scale services and build efficiencies that could drive down costs because demand remains highly fragmented.
That issue is compounded for small and medium-sized enterprises (SMEs) — which make up a large portion of the ICI sector and collectively contribute significant
amounts of food and organic waste — because private haulers often require a minimum output to justify service, which is well above what most generate.
Dwindling landfill capacity and largely unmoving diversion rates are prompting many municipalities to consider expanding their recycling and waste recovery services to the ICI sector. Most do have the jurisdictional authority to do this, but they are also juggling competing priorities for their limited resources.
Still, municipalities wield influence through their ability to convene stakeholders and support local infrastructure, programming and education. As a growing number of municipalities draw connections between their waste reduction and climate commitments and/or face diminishing disposal capacity, their interest in extending services to the ICI sector is beginning to increase.
Meanwhile, the Canadian government has been exploring how it might enhance waste management and improve circularity of organic materials to support its mandate to reduce greenhouse gas emissions.
MULTIFAMILY FOOD WASTE OUTPUT SPURS INTERVENTION
With plans to soon roll out compulsory food waste recycling to all multifamily buildings, the City of Montreal is exploring how to encourage compliance. A two-year pilot project with newly announced funding from the Canadian government will test various “behaviour change interventions” aimed at convincing more apartment dwellers to discard their food waste in a common bin for collecting organics.
Montreal began phasing in its brown bin program for food waste and organics in 2023, but has left multifamily buildings with more than eight units until the final stages of that process. Citywide implementation was initially planned to be complete by the end of 2025, although that may now be pushed into 2026.
Under program rules, food waste recycling is mandatory once brown bins are distributed and municipal pickup becomes available. However, actual participation is considerably lower. As of 2024, only about 30% of food waste generated in multifamily buildings with more than eight units was diverted from landfill.
Four other Canadian municipalities also received research and capacity-building grants from the federal fund, which is aligned with Canada’s efforts to reduce methane emissions from landfill. Collectively, they each address a different food waste challenge through programs targeting: the industrial, commercial and institutional (ICI) sector; public spaces and events; remote and northern communities; and communications to promote food waste reduction.
Food waste is estimated to account for about 57% of the average household’s solid waste output and the largest share of all waste sent to Canadian landfills. There, it is a primary source of methane emissions, which have a global warming potential 84 times greater than carbon dioxide (CO2) over a 20-year period.
Methane contributed 16% of Canada’s total greenhouse gas emissions in 2023, and is deemed to be responsible for about 30% of the global rise in temperature to date.
Organics processing aligns with both waste diversion and methane emission reductions, but there are few coordinated policy and regulatory interventions to support it.
Regulatory gaps and inconsistences have hindered both public and private sector investments and, ultimately, diversion performance. Reliable and stable sources of high-quality feedstocks are needed to drive scale and attract collection and processing investment for services and infrastructure.
Regulations could help to facilitate that and drive uptake of circular systems for endof-life organics. However, in the absence of either mandated or cost-competitive alternatives, the ICI sector continues to embrace the convenience of disposing organics via the solid waste stream.
OVERCOMING BARRIERS
The Circular Innovation Council reviewed existing and pending provincial/territorial and municipal policies and regulations, interviewed a representative group of stakeholders and analyzed its own organics diversion pilot projects to assess the
barriers and drivers for organic waste diversion, and opportunities to improve the ICI’s diversion rate. For the purposes of the study, organic waste was scoped to food waste, soiled tissues and paper towels and other commingled biodegradable materials generally accepted in source-separated organic collection programs. Leaf and yard waste were not included.
Findings revealed a loop of hesitancy among the major players, with governments, waste generators and service providers each tending to wait for others to act first. That’s seen in:
• municipal reluctance to mandate ICI organics diversion without specific direction from the provincial/territorial or higher order of government;
• provincial/territorial hesitancy to enforce waste and climate targets or implement landfill bans without clear municipal and industry readiness or federal-level intervention;
• failure at all levels of government to make strong linkages between organics diversion and climate change action;
– REMI Network
• ICI generators unwilling to take on extra costs to participate; and
• private sector service providers unwilling to lower costs or invest in processing infrastructure without guaranteed regional feedstock volumes and long-term agreements.
Yet, despite these trends, many municipal, ICI and waste service stakeholders are actively working to advance organics diversion performance by introducing local ICI diversion regulations, building crosssector partnerships and programs, and voluntarily adopting organics diversion practices. These efforts demonstrate valuable lessons and models for broader systems change.
Progress will come from collaborative leadership, shared accountability and strategic cross-sector interventions that unlock broader participation and sustained investment in ICI organics diversion efforts across Canada. Policy-makers and stakeholders are urged to focus on the following:
Regulatory alignment and policy support:
Consistent government policy that draws
links between organics waste diversion and climate objectives is needed to advance and encourage investment in programming, services and infrastructure.
Infrastructure investments:
Innovative technologies and public-private partnerships can make processing more accessible and cost-effective. Additional investment is needed to reduce transportation costs, close capacity gaps and support compliance with ICI organics diversion mandates.
Financial incentives and cost reductions:
Support for adopting organics diversion practices helps to align priorities, resources and capability to meet waste reduction targets and comply with diversion mandates across all sectors.
Data collection and transparency:
Consistent data supports municipalities, industry and the ICI sector to benchmark progress, assess impacts and improve the effectiveness of targeted organics diversion efforts. In turn, this can be applied to optimize programs, inform
25_008974_Canadian_Property_Management_WNTR_CN
policy, enhance accountability and support investment decisions.
Education and capacity building:
Equips municipalities and ICI stakeholders with the tools, knowledge and public support needed to improve organics sourceseparation, foster a culture of sustainability locally and strengthen long-term ICI engagement through consistent messaging, hands-on support and clear communication of environmental and economic benefits.
Collaboration and engagement:
Coordinated efforts and shared best practices among municipalities, ICI stakeholders, policymakers and service providers enable support solutions, improve service efficiency, foster crosssector innovation and drive longer-term ICI engagement inorganics diversion.
The full report, Investigating Barriers, Drivers and Opportunities that Influence Diversion of Organic Waste in Canada’s ICI Sector, can be found at https://circularinnovation.ca/wp-content/ uploads/2025/09/CIC-Final-Report_ICI-OrganicsDiversion_ECCC-Sept-2025.pdf.
LIKE THE PARTIES to any relationship, landlords and tenants embrace joint sustainability agendas through a mix of circumstances. Sometimes one woos the other; sometimes it’s a collision of likeminded outlooks; and sometimes their parents — investors, shareholders, corporate head offices — exert a little pressure.
Results of the union can be consequential for greenhouse gas (GHG) emissions, operation costs, asset value and business reputation regardless of the path to togetherness. Sustainability executives from both sides of the equation discussed their experiences during the Building Owners and Managers Association (BOMA) of Canada’s annual national conference earlier this fall — offering perspectives from an influential tenant and from landlords accommodating a mix of engaged and hesitant partners.
“In our asset class, there’s a realization that we’re not going not going to get too far without the cooperation, participation and collaboration of our retail tenants,”
maintained Melissa Ferrato, Vice President, ESG, with First Capital REIT. “We have quite a few large national tenants — the banks, the large grocers — where we’re having conversations at the corporate sustainability level. Then we have the momand-pop type shops where they’re not thinking about this on a daily, weekly or monthly basis, if ever.”
On the flipside, Jon Douglas is tasked with pushing an inventory scattered from Class AAA trophy office towers to aging strip plazas toward a target of net-zero emissions by 2040 in his role as Royal Bank of Canada’s (RBC) Director of global sustainability. That comes with a mission to foster progress and the clout to drop the hammer.
“I do have an advantage that we’re a very large organization, and we try to use our size and scale to move the needle on this,” he acknowledged. “We want to see organizations that are going to decarbonize for the long haul and we will take that into consideration when we are making future decisions, whether at one location or across the country.”
TENANT LEVERAGE
That strategy unfolds somewhat differently for office and retail space. Notably, it’s embedded in the lease for the flagship company headquarters, dubbed RBC Centre, in Toronto’s financial district. Sustainabilityrelated clauses require net-zero building performance by 2040, for which the landlord, Cadillac Fairview Corporation, must develop associated transition and capital plans to spell out how it will be accomplished.
From the landlord’s side of the deal, Karen Jalon, Vice President, sustainability, energy and smart technologies, with Cadillac Fairview, noted that it was a unique experience for her to sit at the table during lease negotiations. Both she and Douglas participated in the process that conventionally tends to be restricted to leasing specialists and other senior executives who may or may not seek outside feedback from supporting teams.
“Often with leases, there’s a sustainability requirement, but they’re very standard. This was so important to RBC that we
were at the table,” Jalon recounted. “It was made very clear that we had to commit, which meant proactively planning and thinking about capital,”
With retail landlords, RBC has opted to negotiate memorandums of understanding (MOU) to set out its expectations — with an objective to switch from fossil fuels to electrification getting high priority. That allows participating landlords, including First Capital REIT, to have advance understanding of what kind of space will meet RBC’s requirements in any of their malls or open-air centres.
“So, if we’re doing an RFP for a new space, or if facility managers see that an HVAC system needs to be replaced, they can say: We already know what RBC wants; we know we need to fuel-switch,” Douglas advised.
RBC’s leasing representatives likewise have guidance. That includes education sessions for both in-house teams and external brokerage services, and a detailed primer that explains the reasoning behind each sustainability objective.
FOSTERING TACTICS
Turning to how retail landlords interact with a wider complement of tenants, Ferrato and Nathan Hines, Vice President, operations, with Crombie REIT, sketched out some of their initiatives to promote sustainability. That has taken form as both capacity-building exercises, exemplified in First Capital’s collaborative brainstorming forums, and action-oriented efforts, such as Crombie REIT’s introduction of composting and other waste diversion tactics.
First Capital recently published a model climate action roadmap to give industry peers and potential adopters a look at some of the
strategies arising from last year’s landlordtenant brainstorming session. That involved more than 60 senior-level representatives from First Capital and its tenants talking through issues of joint concern, such as split incentives and data management challenges, and bringing a range of perspectives from leasing, operations and construction.
The resulting roadmap identifies key factors to enable emissions reduction, each with a menu of measures that landlords and tenants can take either cooperatively or independently.
“In earlier days, maybe we were trying to sell sustainability to tenants in a kind of highlevel way, like: ‘‘This is a good thing, and we’re going to do x, y and z’,” Ferrato reflected.
“Having at least some of the larger tenants at the table co-developing solutions for the space that they are going to be occupying, and ultimately paying the bills for, is the better approach, I think. That’s a newer concept that we’re all starting to tackle.”
Meanwhile, Crombie REIT filled a void in Newfoundland and Labrador, where organics recycling is not commonly available, with an in-house program to compost food court waste at the Avalon Mall. In addition to providing collection and composting facilities for food waste generated in the province’s largest shopping centre, the company also sourced local farmers in the St. John’s area to take the compost.
“It really has benefitted everybody. It decreases hauling and increases diversion rates. Tenants love the story and love being part of it,” Hines said.
To further support recycling and diversion, the landlord has also introduced games and prizes tied to the food court’s AI-powered receptacles, which incorporate scanners and voiced instructions to help users properly sort the items they’re discarding.
“We’re looking at any way we can improve,” Hines reported. “We’re trying to put our best foot forward and have that be the example for some of the smaller tenants that may not know the [sustainability] journey.”
SHARED DATA DEMANDS
Data is a joint resource that poses potential for cooperation or conflict. Landlords often need access to utility consumption data that tenants control, while a growing contingent of tenants needs proof of how their leased space aligns with their own sustainability commitments.
Anti-greenwashing rules introduced into Canada’s Competition Act last year and
mounting pressure — from insurers, investors and regulators — to disclose climate risk exposure and/or GHG emissions add to the demand for credible data to consistently measure and verify building performance within portfolios and among industry competitors and peers.
Last year, for example, Jalon’s department received 144 requests for data from Cadillac Fairview’s investors and tenants. As well, environmental data now commonly comes under auditor scrutiny as part of insurers’ protocol.
“Who would have thought that we would have auditors triple-checking and treating it like financial information?” she mused. “There are stakeholders and tenants who are thinking about that and preparing for a future where we’ll be disclosing this more.”
A range of smart technology — such as fault-detection diagnostics that provide realtime imaging of building systems — along with lease clauses that require data sharing, help make it easier to fulfill requests, while also expanding and reinforcing information needed for capital planning and other decision-making.
“We’re making daily and long-term decisions based off of it, and now we’re getting really deep into measurement and verification to prove out that, yes, we’re getting returns,” Jalon affirmed.
It all flows into plotting the measures that will be needed to reduce GHG emissions.
“The data that we’re getting today is helping us make sure that we’re hitting our horizons,” Hines said. “For our targets for 2040 or 2050, we need to know: How long is the usefulness of x? How do we expect to replace y? How do we budget for that? So long-term planning is absolutely where we’re transitioning to.”
It’s not just the fuel that’s switching out, but also the talking points.
“Our priority is reducing fossil fuels in the heating system. I’m not having a conversation about paybacks. I’m asking: How are we are going to get this transition? When can we get this done?” Douglas reiterated.
“If the tenant comes to us today and says: How will you get to net-zero by 2040?, there are a lot of technical and financial components that go into that,” Jalon concurred. “You have to be proactively thinking about the future with a lot of considerations around affordability and tenants’ needs and investors’ needs, and all of that needs to be phased into your plan.”
CLEANING INNOVATION IN PROPERTY MANAGEMENT
Where Technology Meets Service
Excellence
As Canada’s rental landscape evolves, purpose-built rental developments are transforming what residents and investors expect from property management companies—especially in markets like Toronto, where many new projects are designed to rival top-tier condo communities,
Yet amid the buzz around amenities, sustainability, tenant experience, and cost control, one operational cornerstone often remains underestimated: the cleaning and maintenance partner. More than ever, this quiet force plays a pivotal role in shaping resident satisfaction, asset longevity, and brand reputation. It shouldn’t be treated as an afterthought.
Today’s forward-thinking property management companies are redefining operational excellence by partnering with cleaning and maintenance providers that fuse innovation with human expertise. In this
new era, cleanliness is just the beginning. What truly matters is accountability, transparency, financial stewardship, and datadriven decision-making.
As managers increasingly demand real-time visibility into service execution—
whether it’s suite turnovers, corridor upkeep, or deep cleans between tenants—leading providers are responding with proprietary technology that tracks every task, while empowering frontline teams to uphold consistently high standards.
This is the future of smart service delivery: a seamless blend of people and platforms. Intelligent systems provide proof of performance, operational efficiency, and actionable insights. Skilled professionals bring care, context, and consistency. Together, they ensure that what’s promised is precisely what’s delivered—every single time.
OWNERS ARE ASKING FOR MORE VISIBILITY
Across Canada, ownership groups and REITs are setting a higher bar. They now expect formalized, accurate, and easily accessible reporting on all building operations. From janitorial schedules to maintenance tasks, they want documented evidence that services are being executed properly—and the ability to review that information anytime.
OWNERS INCREASINGLY EXPECT FORMAL, ACCURATE, AND ACCESSIBLE REPORTING FROM THEIR PROPERTY MANAGEMENT PARTNERS. TECHNOLOGY-ENABLED SERVICE DELIVERY MAKES THAT POSSIBLE.
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This shift has put new pressure on management firms to deliver proof of delivery and performance analytics. Tech-enabled cleaning partners meet this demand by providing time-stamped reports, photographic verification, and portfolio-wide dashboards. These tools not only assure owners that standards are being met, but also simplify compliance, budgeting, and audit readiness.
PURPOSE-BUILT RENTALS DEMAND A NEW STANDARD
In purpose-built rental communities, the service experience is an extension of the brand. Residents expect hotel-level cleanliness, proactive maintenance, and seamless communication. When cleaning services are powered by integrated technology, managers gain visibility into scheduling, completion rates, and quality control in real time— enhancing both the resident experience and operational reliability.
Since these assets are designed for longevity, consistent quality over time becomes a strategic investment. Innovative cleaning partners help maintain that consistency across an entire portfolio, ensuring every property—new or established—meets the same high standard.
THE COMPETITIVE EDGE FOR PROPERTY MANAGERS
In today’s market, property management companies that can demonstrate operational transparency to ownership will lead the pack. Those with data-backed service insights can make smarter staffing, budgeting, and maintenance decisions—and stand apart when competing for new management mandates.
Partnering with a company that combines proprietary technology with human excellence isn’t just efficient; it’s a strategic differentiator. It shows that your portfolio is managed with the same precision and accountability applied to financial performance.
A LEADING EXAMPLE IN THE FIELD
Across North America, companies like iRestify have pioneered this model—developing inhouse technology that provides live visibility into service delivery while supporting it with professional teams on site. Their approach proves that innovation and people can work hand-in-hand to elevate service quality and transparency across portfolios.
As the property management industry continues to evolve, one thing is clear: technology alone isn’t enough. The future belongs to companies that understand that when exceptional people are empowered by intelligent tools, the results redefine what “clean” really means.
Misleading Claims a Hazard of Hazy Interpretations NAILING DOWN NET-ZERO
By Cheryl Mah
THE DEFINITION OF net-zero isn’t always consistent and claims of net-zero status aren’t always credible. Guido Wimmers, Dean of the BCIT School of Construction, notes that offsets allow for “creative” carbon accounting, which can be spun to imply a building has a low-emissions profile that it does not actually possess.
“Net-zero doesn’t mean anything as long as it’s just a mathematical exercise,” he asserted during a webinar sponsored by the Urban Land Institute (ULI), British Columbia. “There are good projects, but there are also projects which completely misused these terms. I think that’s still ongoing…and that we have to be careful in how we use these words.”
Wimmers kicked off the discussion of “shifting the narrative on sustainability” with a plea for more transparency and agreement on what net-zero is and how it can be achieved. Variations in industry standards and interpretations have caused confusion and opened the way for misleading claims.
“There are so many different types of definitions possible. You can define it for carbon; you can define it for greenhouse gas emissions; for operational energy; for climate impact,” Wimmers said. “Construction is operating in silos. So is the education system. We need to create a far more integrated approach. We have to change how we teach and what we teach.”
The City of Vancouver is taking a holistic approach with its new Marpole Community Centre. City planner, Forest Borch, describes the 42,000-square-foot complex as “the most inclusive, forward-thinking, and highperforming facility that the city has ever built.”
The design aims for near-zero operational emissions, significant embodied carbon reduction and high accessibility.
The centre, which is pursuing both Passive House certification for high energy efficiency, and LEED Gold certification, will get close to net-zero on the operations side through 100% electrification. It will also be the first Cityowned community centre built to achieve Rick Hansen Foundation Accessibility Certification (RHFAC) Gold.
“This project is set to achieve the 2030 embodied carbon target of the City of Vancouver of 40%, showing that it’s possible to do that today, and it can do that pairing cost savings,” Borch reported.
The project is designed for a 100-year life cycle with consideration for maintenance and operations. It has also involved a few trade-offs to stay on budget, while delivering on social and environmental objectives.
“By phasing this project and delaying the pool construction, we were able to support delivering a community centre that was not compromised on program or size,” Borch explained. “We reduced the parking from
around 210 stalls to 98 stalls, which had impacts on the project’s embodied carbon and also saved the project $3.5 million.”
Turning to another transformational project in Vancouver, the Senáḵw, a multi-phased development located on 10.5-acres of Squamish Nation land, is set to be the largest residential project in Canada to achieve netzero operational carbon.
“It’s a very complex project — lots of complex partnerships; complex financial arrangements; complex construction; a difficult site,” advised Graeme Silvera, Principal of G. Silvera & Associates. “We’re just wrapping up Phase 1 right now with the first tower approaching occupancy in December.”
The four-phase development will encompass 11 towers, providing approximately 6,000 housing units, including more than 1,200 affordable units. It has adopted a broader definition of sustainability based on four key pillars: the built environment; carbon footprint; transportation; and culture.
“Senáḵw is more than just about low carbon, more than just about energy efficiency and using sustainable materials. It’s really a broader definition of sustainability, and it’s built on the foundation of the nation, bringing the historic village of Senáḵw back to life,” Silvera said.
Still, the low-carbon and energy efficiency elements are significant. That’s exemplified
Vancouver's Marpole Community Centre
CONSTRUCTION-RELATED EMISSIONS SCRUTINIZED
Nine of Canada’s largest general contractors provide insight for a new report on reducing greenhouse gas (GHG) emissions on construction sites. The contributing firms — Aecon, Bird, Chandos, EllisDon, Graham, Ledcor, Multiplex, PCL and Pomerleau — are part of the Canadian Construction Sustainability Alliance.
The report, produced by The Transition Accelerator, draws on operational data from 600 projects across Canada to identify five priority actions for the construction sector:
• electrifying light-duty vehicles and small equipment;
• optimizing and electrifying temporary heating;
• adopting renewable diesel as a bridge fuel;
• connecting sites to grid power instead of diesel generators; and
• deploying hybrid and electric excavation equipment.
The report proposes an incremental path to achieve the sector’s decarbonization goals. By 2030, it suggests a 25% cut in emissions is achievable through the early adoption of four key measures: vehicle
in the 10-megawatt district energy system that will extract heat from the adjacent Metro Vancouver sewer line for heating and cooling, via heat exchangers and electric chillers. An integrated bike share program, a design to adapt to sea level rise, and mass timber are among other carbon reduction measures.
electrification (5%),; heating optimization (5%); adoption of renewable diesel (10%); and grid connection (5%).
By 2035, it’s believed a 55% reduction could be achieved with largescale implementation, notably through increasing the use of renewable diesel (20%) and the early deployment of electric excavation machinery.
By 2040, the sector could achieve a 75% reduction, with renewable diesel as the main driver (25%), followed by vehicle electrification and grid connections (15%).
“This report is clear: top Canadian construction companies are ready to lead the industry through the climate transition while our industry continues to build the infrastructure required to ensure Canada’s ongoing prosperity,” says Rodrigue Gilbert, President of the Canadian Construction Association.
The Transition Accelerator is an organization that facilitates connections between businesses, industry associations, research institutions and policy-makers to advance climate change action. For more information, see the website at https://transitionaccelerator.ca.
Silvera favours a perspective on net-zero that goes beyond carbon reduction and includes risk management.
“Net-zero is future-proofing your asset against future energy shocks,” he maintained. “Carbon is going to have to be priced properly at some point on the worldwide market. When that happens, if
you do not have a project that is future-proof to lose less carbon, you’re going to have a massive shock to the system in terms of operational costs.”
Cheryl Mah is the Managing Editor of the MediaEdge publications, Construction Business and Design Quarterly.
–REMI Network
MULTIFAMILY MINIMALISM
Window-mounted Heat Pumps can Simplify Retrofits
By David Rames
OLDER MULTIFAMILY BUILDINGS
that weren’t designed for electric HVAC systems present a challenge for decarbonization and achieving Canada’s target of net-zero emissions by 2050. Conversion of gas-fired heating will be key to reducing operation emissions, driving demand for scalable technologies that can be deployed across a diverse range of multifamily buildings.
Plug-in, all-electric heating and cooling units are one market response. Windowmounted heat pumps can be practical where aging building infrastructure and limited mechanical space make retrofits difficult with traditional gas-based heating or even split heat pumps. They are well-suited to multifamily buildings that lack ductwork or electrical headroom.
The compact heat pumps require no refrigerant lines, drainage or electrical panel upgrades. They are low-impact pieces of equipment that a single technician should be able to install in fewer than 60 minutes, per unit, avoiding the costly, multi-day disruptions associated with split or ducted systems.
Window-mounted heat pumps come in a single, self-contained unit that typically runs on a standard 120V/15A circuit, avoiding the need for expensive electrical panel modifications. They also have sealed refrigerant systems and internal condensate management.
While heat pumps have been around for decades, they’ve long had the reputation of poor performance in cold climates. However, today’s leading window heat pump models deliver 100% of rated heating capacity down to
about –15°C (5°F) and are specified for reliable operation down to –25°C (–13 °F). This may allow building owners to replace gas, oil or steam systems with a fully electric plug-in option, depending on the climatic region where they are situated.
In regions where weather can dip below –25°C, landlords or condominium corporations can opt for a dual-fuel setup, which pairs the heat pump with a boiler or other backup system. This approach still allows the heat pump to handle the majority of the heating season, but the backup system should be factored into the overall project costs.
Evidence from New York City’s ongoing retrofits to electrify aging subsidized housing reveals that traditional heat pump retrofits in multifamily buildings cost about USD $38,000 (CAD $52,000 per unit) when structural changes and electrical upgrades are factored in. Retrofits with window-mounted heat pump technology — conducted as part of an associated Clean Heat for All pilot project challenge — were completed at about onethird that amount. (Equating to roughly CAD $17,000 per unit.)
During the challenge, contractors installed 72 window heat pump units across 24 apartments in just eight days. That pace is nearly impossible with ductless or variable refrigerant flow (VRF) systems, especially in occupied units.
Tenants experienced minimal disruption during the retrofit, and reported more even temperatures, quieter operation and better
indoor air quality compared to the legacy steam radiator system. Early data also showed an 87% drop in energy use and a 50% reduction in heating costs to accompany that tenant satisfaction.
Other housing authorities and public agencies in the United States are now expressing interest in pursuing the option. This approach also aligns with Canada’s climate policy objectives, and several jurisdictions offer targeted support for heat pump retrofits.
In British Columbia, programs like CleanBC offer rebates for multi-unit residential buildings, while Ontario’s Save on Energy Retrofit program supports upgrades in mid- and high-rise properties. Affordable housing providers may also qualify for national programs such as Canada Mortgage and Housing Corporation’s Greener Affordable Housing initiative. These incentives help reduce upfront costs, accelerate adoption and make plug-in electrification more accessible across a range of housing types.
Electrifying existing multifamily buildings doesn’t have to mean tearing out walls or upgrading panels. In many cases, it can be achieved through compact, cost-effective equipment designed for the buildings we already have and the climate we live in.
David Rames is Senior Product Manager with Midea, an appliance manufacturer, including HVAC systems and heat pumps. For more information, see the website at https://nahvac.com/product/ packaged-window-heat-pump.
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CLIMATE FOR RETURNS
Adaptation Measures Deliver Payback on Investment
FORGET CRYPTO, early warning systems to detect severe weather threats are already calculated to pay back three to 12 times on investment within a one- to threeyear period. With science offering up assurance that climate response will be a long-term and intensifying societal need, analysts suggest this could be a lucrative time to get into a surging market.
“It’s not a philanthropic exercise at this point for financial institutions,” contends Michelle Lu, North American banking commercial lead with Climate X, a data
By Barbara Carss
analytics firm that projects the probability of severe weather events and their impact on asset values. “Really, it’s about a key business opportunity that is emerging.”
Speaking earlier this year as part of the Responsible Investor webinar series, she pitched the potential of profits twinned with risk management/mitigation benefits in what the World Economic Forum (WEF) projects will be a USD $2 trillion global market for climate adaptation financing before the end of this decade. That unfolds in sync with the release of a new net-zero standard for
financial institutions from the Science Based Targets initiative (SBTi), which recommends more attention be paid to greenhouse gas (GHG) emissions profiles in investing in, lending on, underwriting insurance or raising capital for real estate.
ADAPTATION FINANCING
For now, private sector forays into adaptation financing are relatively rare. Total global climate finance input jumped more than fourfold over the past 12 years, from USD $364 billion to USD $1.6 trillion, but the
share channelled into adaptation shrank from a high of 10% earlier in that period to just 5% in 2022-23 and 4% in 2023-2024.
The private sector’s contribution last year is pegged at about USD $4.7 billion versus USD $500 to $600 billion directed toward decarbonization efforts. That belies WEF’s expectation that the private sector will one day kick in 60 to 70% of required funds.
“There’s a significant gap to be closed by the end of the decade for adaptation finance and we expect the private sector to play a very pivotal role in bridging this financing gap,” Lu maintains.
The rationale for doing so is fairly straightforward. The instruments to better enable it are still a work in progress.
Lu underscores opportunities to avoid credit loss, build new lines of business and add pathways to meet green financing targets. Return on investment (ROI) can also surpass that for climate transition measures such as renewable energy generation or electrification and other emissions-reducing retrofits.
Lu cites data from various sources — including WEF, the World Resources Institute (WRI), the Institute for Catastrophic Loss Reduction (ICLR), the Organization for Economic Development
and Cooperation (OECD), SwissRe and the global financial services firm, Standard Chartered — indicating:
• 2- to 5-times payback within five to 10 years for floodproofing measures;
• 6-times payback within two to eight years for roof-bracing retrofits;
• 6-times payback within seven to 15 years for fire-resistant construction;
• 2- to 8-times payback within five to 20+ years for a range of resilient infrastructure; and
• 3- to 12-times payback within one to three years for early warning systems.
Nevertheless, the multiplicity of citations also illustrates the lack of a universal metric to quantify loss savings and the flow-through asset value impacts of resilience.
“Typically, adaptation projects are still considered much less bankable compared to other projects because the ROI is measured in avoided losses rather than recurring revenue streams,” Lu acknowledges. “There’s this impression of: there’s only loss savings if a disaster were to happen. But, in reality, because of the nature of the hazards, payoff should be thought of as [reducing] annual expected loss.”
That aligns with the concept of climate value at risk (CVaR). The acute manifestations of physical climate risk — tornadoes; floods; ice storms; forest fires — take form in random destructive events.
However, there are also chronic effects — more intense heatwaves; prolonged poor air quality; erratic freeze-thaw cycles — that tax building systems/structures and alter conventional assumptions about operational requirements and equipment/ infrastructure lifespans. All these flow through to asset value.
Standardized metrics for quantifying avoided losses are on Lu’s list of key supports to help de-risk investment. There’s also a need to bolster the creditworthiness of borrowers, particularly for municipal governments that face challenges to climateproof infrastructure but are constrained in taking on debt or issuing guarantees, as well as a general need for incentives.
“If you are able to adapt or invest in adaptation, that benefit would not just benefit your holding period, but potential future value of the asset or the company, but there’s high uncertainty on ROI timing with potentially a much longer payback horizon,” she observes. “There are definitely regulatory and policy gaps, and not enough incentives in the adaptation space, as previously a lot of the incentives went to the transition risk side.”
DECARBONIZATION GUIDANCE
The new SBTi net-zero standard for financial institutions targets scope 3 downstream emissions related to investing (i.e. emissions tied to financial institutions’ clients) and is meant for organizations that derive more than 5% of their global revenue from lending, asset management, insurance underwriting or capital market activities. Like the SBTi corporate net-zero standard, enrollees must quantify their emissions relative to a chosen base year, establish reduction targets that are tied to a verified plan for achieving them, publicly state their commitment and report on their progress.
The initiative is deemed to be sciencebased because targets must be in line with the level of reduction needed to keep global warming within the Paris Agreement’s parameters. Currently 146 Canadian organizations, including seven real estate entities, are among the 11,947 worldwide signatories that have either set targets or made a commitment to do so once their reduction plans are approved through the corporate netzero standard. (Another 21 Canadian organizations, including four real estate entities, are listed on SBTi’s dashboard as having withdrawn their commitments.)
“The standard empowers institutions to play a catalytic role by enabling and emphasizing portfolio alignment with net-zero, using alignment targets to incentivize them, in the near-term, to support high-emitting sectors, increase the share of climate-aligned financial activities across their portfolio, and leverage their influence to drive real-world decarbonization,” states an SBTi communique, released on the July 22 launch day.
Participating financial institutions will be required to have policies to reduce exposure to fossil fuel and deforestation. A real estate policy is also recommended, but not mandatory. Through that public document, enrollees would:
• commit to extend financial services only to buildings that are net-zero ready as of a specified year; and
• state intended measures for increasing financial activities related to retrofitting and decarbonizing existing buildings.
The policy is also expected to include procedures for monitoring, and schedules for reporting, progress on those two objectives.
While SBTi is a voluntary initiative, many industry watchers argue that decarbonization aligns with the momentum of economic and regulatory trends. Despite recent policy shifts within the United States, those trends could become more discernible in Canada as
government and business look to forge a broader range of trading ties.
Looking specifically at real estate, the Real Property Association of Canada (REALPAC) and the Canada Green Building Council (CAGBC) have launched a joint effort to confer with commercial real estate appraisers on the development of valuation approaches and tools that can more precisely capture sustainability and resilience. Green building specialists also stress the importance of industry standards now that there is no longer a consumer carbon price to provide an easy, agreed upon reference point for costs and paybacks.
“The consumer carbon price provided a consensus on the risk for high-carbon buildings. Its cancellation didn’t change the business case for decarbonization; it changed the consensus on the business case. Smart real estate leaders are saying: Okay, now we’re in the wild west of predicting carbon price volatility, escalation and value each year,” submits Eric Chisholm, Principal and Co-founder of the engineering and sustainability consulting firm, Purpose Building. “Unfortunately, now it will be harder for purchasers, sellers, tenants and landlords to agree on what the threat is, what the value difference is between high-carbon
and low-carbon buildings and who should pay what costs and when.”
Speaking at a forum for proptech innovators as part of Toronto’s Tech Week in late June, Sheida Shahi, Co-founder and Chief Executive Officer of Adaptis, a capital planning tool employing artificial intelligence (AI) to map out low-carbon options for new development, concurred. She defined her company’s product primarily as a financial tool.
“We often get put in the cleantech bucket and I keep trying to take us out of it,” Shahi mused. “We have asset managers in our
platform planning for 2050. They are looking at the highest return on investment at the lowest price. We’re talking about energy costs; we’re talking resilience of the building; we’re talking about residual value of the materials. Better decisions mean a more financially stable building over time.”
For more information about Climate X, see the website at www.climate-x.com. For more information about the Science-based Targets netzero standard for financial institutions, see the website at https://sciencebasedtargets.org/financialinstitutions.
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Peter LaForme, Executive Vice President
Andre Lebedev, M.Sc., P. Eng., Principal, SME, Electrical Power Engineering
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BUTTRESSED AGAINST BACKLASH
GRESB Participants Stand Firm on ESG
THE 2025 GRESB BENCHMARK
shows year-over-year improvement in the average global score for environmental, social and governance (ESG) results in commercial real estate portfolios, along with an 8.2% drop in Canadian participation. This year, 78 Canadian entities reported to the annual assessment — which measures 15 variously weighted elements of asset-level performance and portfolio-wide policies and practices — down from 85 in 2024.
That’s a trend also seen in the United States, where participation slipped by 3.7%, from 456 entities in 2024 to 439 in 2025. Globally, though, the response level held relatively steady, with a total of 2,382 entities
contributing to the average global score of 79 out of 100 possible points.
This year’s global average improved by 3.1 points from 2024, and first-time participants also delivered a new high average score of 68, up from 62 in 2024. Almost 60% of total respondents achieved scores that were at least on par with the global average, while the top 40% significantly surpassed it.
Scores for the top 20%, attaining a GRESB 5-star ranking, ranged from 97.7 to 89.5. Scores for the penultimate 20%, in the 4-star tier, ranged from 89.5 to 84.7, and scores for the 20% within the 3-star level ranged from 84.7 to just shy of 79.
GRESB administrators highlight ongoing
progress in data coverage that’s giving the benchmark’s investor subscribers more insight into asset-level resource consumption, greenhouse gas (GHG) emissions and waste diversion. This year saw a modest decrease in average energy consumption (0.43%) and GHG emissions (1.3%) across the total database of reported assets, but a slight uptick (0.41%) in water consumption. As well, 22% of reporting assets are defined as “highly energy efficient” when pegged against the ASHRAE energy use intensity standard for existing buildings.
REGIONAL VARIATIONS
On the policy front, two-thirds of partici-
pating entities have targets to reach netzero emissions, up from roughly 50% just two years earlier. Nevertheless, buy-in varies considerably across global regions, with 74.3% of participating European entities pursuing net-zero versus 48% of respondents in the Americas.
In an online commentary accompanying the 2025 results release, GRESB’s Chief Innovation Officer, Chris Pyke, acknowledged an “international divergence in opinions and experiences” that’s filtering through to investors’ and real estate entities’ motivations for subscribing to or reporting to GRESB. To illustrate, he pointed to a GlobeScan survey released in the summer of 2025, in which 91% of participating sustainability professionals employed in North America reported that they either perceived or had experienced backlash against their roles and agendas.
“That’s obviously dominated by the United States in this context,” Pyke said. “But, one way or the other, we see a global divergence in lived experience of sustainability professionals in this moment in time.”
Despite the small drop in participants from Canada and the U.S. this year, the Americas database has now broadened to include 19 real estate entities from Brazil, 18 from Mexico, three from Chile and one from Columbia. Collectively, they achieved an average performance score of 67 (calculated across 10 elements), which accounts for 70% of the total score, and an average management score of 92 (calculated across five elements), worth 30% of the total score.
Real estate entities in the Americas were generally strongest in performance elements related to tenants and community, risk assessment, and data monitoring and review, while the lowest average scores were related to waste diversion and water consumption. There was year-over-year improvement in the average scores for all elements.
COSTS, RISK AND STABILITY
Making the case for GRESB’s expedience in the face of backlash, Pyke drew connections to three prime concerns for investors and real estate managers: operating costs; physical risk; and energy grid stability.
He maintained that building performance, resilience and on-site renewable energy sources, along with portfolio-wide strategies to enhance those outcomes, are indisputably sound objectives to counter rising costs and to benefit from tenants’ flight to quality.
GRESB provides relevant insights, tied to credible metrics, on all these concerns.
“The rising price of retail electricity and a limited topline growth in rents is putting a premium on efficiency and expense control.
We also see a priority on physical risk and resilience that’s most directly expressed through insurance costs — a concern about getting insurance, keeping insurance and mitigating rises in insurance rates over time,” Pyke tallied.
As well, investors are gaining a more sophisticated understanding of peak demand management — perhaps in sync with the
emerging prominence of data centres within the alternative assets class.
“It’s not just your average annual energy consumption. It’s [a question of ] how does the consumption for a piece of real estate or infrastructure impact the grid when the grid needs it most?” he maintained. “That issue of the timing and the location of energy demand is emerging to be just as important as average annual consumption.”
An overview of the 2025 GRESB real estate results can be found at www.gresb.com/nl-en/2025-realestate-assessment-results.
5-STAR RATINGS SCARCE FOR CANADIAN REAL ESTATE ENTITIES
Seven different Canadian companies have emerged as 2025 GRESB sector leaders in the Americas region, denoting top scores within various categories of property types and ownership structures in the annual global assessment of ESG performance in commercial real estate portfolios. As well, an asset manager headquartered in the United States earns the accolade for a property fund portfolio made up of Canadian properties.
“GRESB sector leaders set the pace for the industry, showing how strong fundamentals, effective management and measurable performance can create long-term value and drive progress for the market,” says GRESB Chief Executive Officer Sébastien Roussotte.
The sector leader designation is awarded to the portfolio that attains the top score within each property category, and to other portfolios with scores that are within one point of that top performance. In the Americas, those leaders are drawn from a total of 567 reporting entities that include direct real estate, third-party managers, property funds and real estate investment trusts (REITs) spread across Canada, the United States, Mexico, Brazil, Chile and Columbia.
This year, three Canadian REITs — Primaris REIT, RioCan REIT and SmartCentres REIT — share Americas sector leader status for listed retail portfolios.
On the non-listed side of the equation:
• Crown Realty Partners’ core fund is the sector leader for office portfolios;
• Fengate Asset Management’s commercial income fund is the sector leader for diversified office/industrial portfolios; and
• Cadillac Fairview Corporation is the sector leader for diversified office/retail portfolios.
U.S.-based Harrison Street Asset Management is an Americas leader for diversified portfolios for its Canada alternative fund, and Sun Life Assurance Company of Canada/ BentallGreenOak is the Americas sector leader for diversified real estate development.
This is the sixth time, including every year since 2020, that Cadillac Fairview has been an Americas sector leader. “Our success in GRESB enhances our credibility, demonstrating that prioritizing sustainability and responsible management can contribute to long-term value for our stakeholders,” says Sal Iacono, the company’s President and Chief Executive Officer.
Cadillac Fairview and Crown Realty are the only two Canadian companies to achieve a GRESB five-star rating for achieving scores in the top quintile, or 20%, across the entire database of 2,382 reporting entities. This year, those scores ranged between 97.7 and 89.5 out of a possible 100 points — well above the overall average of 79.
Crown Realty actually hit that threshold twice, earning five-star ratings for both its core fund office portfolio and corporate core fund mixed-use portfolio. The company has been in the five-star ranks every year since 2019.
“This is a meaningful achievement given the distinguished group of international peers Crown is benchmarked against,” observes Tom Idzal, Head of Americas for GRESB. “Being named a regional sector leader and achieving a five-star rating for the seventh consecutive year is a testament to Crown’s unwavering focus on sustainability and transparency.”
The Oceania region, comprised of Australia and New Zealand, has the most impressive profile in the five-star quintile. More than one-third, or 45 of 132, of its reporting entities achieved the top ranking this year.
SUCCESS CHARGED for
Why Battery Storage is the Next Big
investment
Battery storage is gaining traction in Canada’s property management sector as a way to improve energy efficiency, reduce costs, and support sustainability goals. Ontario, in particular, is seeing an uptick in this technology as more businesses and property owners seek ways to optimize energy use while incorporating cleaner solutions.
“It’s a rapidly evolving technology,” says Francesco Agueci, Project Principal, Electrical Service Area Lead at Pretium Engineering. “Whether it’s mixed-use residential, commercial, or any type of large building, owners and facility managers are seeing the value of investing in these clean energy systems.”
Simply put, battery storage captures and saves electricity for later use. The compact, modular units vary in size based on capacity and are usually located outdoors or in basements. Using lithiumion batteries, like those in smartphones and electric vehicles, they charge from the grid or renewable sources like solar and wind. During high demand or outages, the battery converts stored energy back to electricity, supplying it to the grid or directly to a building.
“Similar to solar technology, which has grown in popularity over the past decade as costs have come down, battery storage is becoming more feasible, leading to higher adoption rates in Canada,” Agueci says. “I foresee a time in the not-so-distant future when all new buildings are designed with battery storage in mind.”
SURPLUS & STABILITY
While clean energy investment has been a priority of the commercial real estate sector for many years, not all renewable energy sources come without hurdles—availability being the primary challenge.
As Agueci points out: “Solar requires sunlight, and wind depends on wind conditions. Hydro is fairly consistent, but other renewables can fluctuate. This affects electricity grid stability—and because of these fluctuations, you will see big spikes and sags, which isn’t good for a stable grid. Batteries can quickly react and absorb a lot of that inconsistency, keeping your power stable.”
According to Agueci, here are the Top 3 reasons to invest in battery storage:
1. Environmental Benefi ts - Battery storage promotes sustainability and supports the integration of renewable energy. These systems store surplus energy generated by sources such as solar and wind power, enabling buildings to use clean energy even during periods of low production.
2. Building Resilience - Battery storage contributes to grid independence and stability by regulating voltage and frequency. This reduces reliance on the traditional power grid and improves resilience, ensuring an uninterrupted power supply during grid failures due to heat waves and other outside forces.
3. Energy & Cost Savings - Battery systems enable buildings to store electricity when rates are low and use it when prices increase, which can help reduce overall energy costs. They also allow buildings to lower peak electricity demand, potentially avoiding higher utility charges and enhancing energy efficiency.
“For building owners, having a decentralized solution that’s within your control is an attractive investment, especially when it’s paired with other clean energy sources, like wind and solar,” Agueci says. “The excess generation can be stored for later use within the building or even sold to offset the installation costs.”
PLANNING & DESIGN
For new buildings, integrating battery storage from the onset allows for seamless incorporation into the design. Architects and engineers can tailor the
system to the building’s needs to better optimize energy efficiency and ensure compatibility with other renewable energy sources. Incorporating energy storage at the beginning of a project makes it easy to participate in demand response programs and maximize cost savings.
For existing buildings, retrofitting battery storage can still provide substantial benefits and reduce reliance on the grid. However, challenges like space constraints, compatibility with existing electrical systems, and upfront costs may require some additional planning. Despite these hurdles, many commercial and industrial buildings are adopting battery storage to improve energy resilience and lower their operational expenses
“At Pretium, we’ll start with a feasibility study to look at the cost scenarios, before developing a solution that meets your specific power requirements and operational challenges,” Agueci says. “Our engineering team combines advanced technical expertise with innovative design methodologies to ensure each system we design exceeds our customers’ expectations.”
Pretium will also support your team in sourcing cost-saving incentives or available rebates for battery storage investments. Once the system is installed, it will ensure a smooth project deployment as your maintenance provider takes control, monitoring the real-time data and providing routine maintenance to ensure the longevity of the batteries.
Data-Driven Approaches to Service Contracts OPTIMIZATION OPENINGS
By Ainsley Muller
A DATA-DRIVEN APPROACH to maintenance is reshaping conventional service contracts, replacing long checklists of scheduled tasks with responses based on real-time monitoring of actual equipment condition. The transformation creates both opportunity and risk for building owners, but those who understand the new landscape can drive better outcomes and more predictable costs.
For decades, the building service industry operated on a simple premise: charge for time; perform scheduled tasks; respond to problems. The typical maintenance contract looked like a restaurant menu — predictable items at predictable prices, regardless of whether they were needed.
This model misaligned incentives between the building owner and vendor. When service providers billed by the hour, financial success came from more billable time rather than optimal building performance. Building owners wanted efficient, reliable operations at predictable costs. Service providers needed sufficient billable hours to maintain profitability.
This created a transparency challenge. Building owners had limited insight into
whether their maintenance investments were optimizing performance or simply meeting contractual obligations.
Analytics platforms have brought about change, although it has taken time for service providers to begin adopting a technology that has been available for more than a decade. That’s arguably due more to business model confusion than the technology itself.
Most service providers initially tried to sell analytics platforms as separate products to building owners, requiring customers to buy, manage and interpret complex software themselves. The shift started when some contractors realized they didn't need their customers to buy the software.
They could use it internally to deliver better service — treating the technology as a practical tool rather than an experimental product. That’s resulting in new approaches, such as:
• Technology-enabled record-keeping: digital detailed asset registries that give contractors the ability to track repair costs by equipment and provide customer portals with basic performance data;
• Outcome-based maintenance: defining and reporting on outcomes such as comfort scores, energy efficiency metrics, avoided costs — i.e. a shift from "we changed 150 filters" to "we maintained 98% comfort score while reducing energy use by 12%"; and
• Condition-based maintenance: employing continuous monitoring technology to optimize when and how maintenance occurs — i.e. instead of quarterly filter changes regardless of need, technicians respond to actual equipment conditions based on realtime data.
PARTNERSHIP DYNAMIC
While still more theoretical than applied in practice, the technology also presents the opportunity for full outcome-based billing. That would tie maintenance charges to actual results such as equipment longevity and avoided downtown. Through this approach, service providers would become true partners, sharing in the economic outcomes they help create.
Building owners contemplating a switch in service contract approaches and/or providers are advised to consider the following:
• Clear accountability metrics: does the service provider employ specific performance indicators such as comfort scores, energy efficiency ratings, avoided maintenance costs and equipment longevity metrics?
• Experience with technology-enabled maintenance: does the service provider have an established client base and history or is it still on a learning curve with the technology?
• Transparency through data: do customer portals show real-time building performance, maintenance histories and predictive insights? And, how do service providers hold themselves accountable for outcomes outlined in the contract?
• Flexible contract structures: do they allow for adjustment of maintenance frequency based on actual equipment conditions and risk tolerance? Do they have ways to reduce visual inspections and use technology instead?
Technology-enabled service providers should help owners/managers to understand the building as a managed asset, while traditional contracts often provide little insight into repair costs by equipment, maintenance trends or capital planning support. Under the old system, service providers made more money when equipment failed or when maintenance took longer than expected. Technology changes this dynamic by making value visible and quantifiable. When service providers can demonstrate avoided costs, energy savings and extended equipment life, they can justify premium pricing based on results rather than hours.
This shift has practical implications for contract structure and budgeting. Costs
should be more predictable as technologyenabled monitoring reduces surprise failures and emergency repairs. Building owners can budget more accurately when maintenance is driven by actual equipment conditions rather than arbitrary schedules.
There is opportunity for shared risk and reward. Advanced contracts might include provisions where service providers share in energy savings or receive bonuses for extended equipment life. This creates incentives for optimization rather than just maintenance.
Automated monitoring and reporting reduces administrative overhead and provides better visibility into building performance. The technology also enables new service delivery models. Remote operations centres can monitor multiple buildings 24/7, dispatching technicians only when needed and ensuring they arrive with specific diagnostic information and appropriate parts.
BRIDGING TECHNOLOGY REQUIRED
Despite the progress in data collection and analysis, a critical operational challenge prevents many service providers from fully embracing condition-based maintenance: their work order systems can't handle flexible, data-driven scheduling. Most maintenance management software was built for the old model of scheduled tasks that happen regardless of need.
These systems struggle with the dynamic decision-making that condition-based maintenance requires. When a building's data suggests that some equipment needs attention while other systems can wait, current software can't easily adjust schedules, bundle related work, or reallocate budget accordingly.
This creates a bottleneck for building
owners. While the technology exists to identify what needs attention and when, translating those insights into efficient service delivery remains largely manual. Service providers need experienced personnel to make real-time decisions about work prioritization and resource allocation — a constraint that limits how quickly the industry can scale these approaches.
For building owners, this means the full benefits of predictable, optimized maintenance remain partially unrealized. The ideal scenario — where building data seamlessly drives service decisions and budget allocation — requires better integration between monitoring platforms and operational workflows.
Service providers face various barriers to adopting technology-enabled approaches: upfront software costs; the need for specialized staff; workflow system limitations; and uncertainty about return on investment. However, building owners can actively drive this transformation by changing how they approach service contract renewals and what they demand from providers.
Building owners ready to embrace technology-enabled services face a change management challenge as much as a procurement decision. The transition requires new ways of thinking about building operations, service relationships and cost management, but it also represents an opportunity to gain competitive advantages while the majority of the market remains stuck in traditional models.
This mindset shift — from passive recipient to active partner — may be the most important outcome of technologyenabled services. When building owners have access to real-time performance data and clear accountability metrics, they can make informed decisions about maintenance priorities, capital investments and operational strategies.
The technology exists. The service providers are evolving. The business models are emerging. Building owners need to understand their newfound leverage in these relationships.
Ainsley Muller is Head of Content with Nexus Labs, an online forum with a mission to objectively highlight technologies and resources that can advance building decarbonization and digitalization. The preceding article is excerpted from his post, Beyond Scheduled Maintenance: TechEnabled Services Align Building Owner and Contractor Incentives. For more information, see the website at www.nexuslabs.online.
INVESTOR VAMOOSE
Slumping New Condo Sales Have Ripple Effect
A FIX TO REVIVE slumping new condo sales will be tricky to execute in current market conditions. It’s a matter of the right product at the right price, advises Peter Norman, Vice President and economic strategist with Altus Group, and neither is easy to come by in the former investment hotbeds of Toronto and Vancouver.
“The model whereby a lot of sales go to investors — which ultimately get flipped over to end-users — has kind of hit the skids right now because investors don’t see potential value coming through that model,” he observed during the commercial real estate advisory firm’s recent online overview of 2025 market conditions. “I think we’re going to have a lot of challenges through 2026, at least in Toronto and Vancouver.”
Sales of new homes in the Greater Toronto Area, both condo apartment and single-
family, have plummeted by about 90% from the 2022 peak. As investors vanish, the preponderance of small units in new condo inventory is increasingly out of sync with what prospective purchasers are seeking.
Meanwhile, developers focused on highrise projects that take years to deliver to the market have suffered a sustained run of bad timing that’s brought soaring construction costs, escalating interest rates, diminished land values and, now, faltering consumer demand. In 2024, nearly $598 million in residential lands sales in the Greater Toronto Area were due to financially stressed vendors, while Greater Vancouver saw nearly $319 million worth of similar transactions.
Joining Norman for the online presentation, Ray Wong, Altus Group’s Vice President of research and data analysis, noted that
many defaulters borrowed to purchase land that has since lost value, got hit with higher costs on refinancing and couldn’t hold on long enough to complete projects, close unit sales and garner payment. Others lost skittish investors or “failed to pivot” in the blast of volatile market forces.
“We’ve had quite a few distressed transactions over the last 18 to 24 months, and this will likely continue going into next year,” Wong projected.
Solvent investors appear to either be scooping up big bargains or simply not buying. Altus reports transaction values are down from last year’s levels for all asset types except hotels, but the steepest decline is the 47% drop in residential land. As of Sept. 30, 2025, $4.7 billion worth of deals had been recorded, compared to $8.9 billion in sales over the first three quarters of 2024.
BUILDERS VOICE PESSIMISM
The larger share of developers will hold on to complete their in-progress projects, but are nevertheless struggling to eek out a profit and remain competitive. The Canadian Home Builders’ Association (CHBA) pegs the sector’s outlook on multifamily market conditions at 16.8 on a scale of 100 in its Q3 2025 housing market index. The record-low rating has dipped since hovering around 22 throughout 2024, and plunged from the 87-to-89 range in late 2021 and early 2022.
Just 4% of CHBA’s nationwide panel of regularly surveyed industry insiders characterize current selling conditions as “good” and just 7% expect they’ll be good in the next six months, while 68% call current selling conditions “poor” and 61% do not expect that status will improve over the next two quarters. The vast majority (80%) report traffic from prospective buyers has been low or very low, while 3% say they have seen a high or a very high level of interest.
NO ‘90s FLASHBACK
Analysts with Canada Mortgage and Housing Corporation (CMHC) contend the current condo market downturn is milder than the crash of the 1990s. Periods of soaring home prices and strong investor interest preceded spiking interest rates in both eras, but, this time, there’s no supply glut and developers and purchasers are generally more solvent.
Toronto home prices doubled on average between 1986 and 1989, then the early 1990s brought a significant recession and the sharpest drop in employment since the 1930s.
Speculative development leading up to the crash produced significant oversupply, which came onto the market at the same time that global economic restructuring slowed growth.
“Looking ahead, we expect the market to gradually regain momentum due to a persistent lack of supply in the Greater Toronto Area, greater economic diversity and stability compared to the 1990s, and stricter lending rules for both developers and buyers,” CMHC analysts forecast.
To obtain financing, today’s developers need to presell at least 70% of units — a more riskadverse approach than their 20th century counterparts who often presold about 50% and gambled that unit prices would rise, but construction costs wouldn’t.
Today’s buyers also face mortgage stress-tests not in place in the 1990s. Notably, mortgage arrears hovered at 0.23% in the first quarter of 2025, well below the record high of 0.68% in the first quarter of 1992.
The full CMHC analysis, Is Toronto’s condo market downturn a repeat of the 1990s?, can be found at www.cmhc-schl.gc.ca/observer/2025/is-toronto-condo-market-downturn-repeatof-1990s.
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development
“The resale market has had a big price adjustment and is certainly picking up. On the new construction side, one of the challenges is that the product is still priced above the market,” Norman maintained.
He suggests builders in markets outside Toronto and Vancouver, where lower land costs make mid-rise developments and larger units more feasible, may have more leeway to close the gap. There will be continuing new housing demand, even with recent immigration policy adjustments expected to dramatically slow the pace of population growth, including pent-up demand that improved affordability could unleash.
“I think the market is going to come back when we have the right kind of product to appeal to end-buyers. Initially, that will tend to be smaller projects with larger units that can be delivered to the market more quickly,” Norman hypothesized. “Once we see a regular price coming forward that’s more like $700 to $800 per square foot, as opposed to $1,100, that may be something that stimulates the market a little bit.”
Thus far in 2025, Altus figures show that Vancouver’s new condo sales have dropped 61% from last year’s rate, while Toronto has experienced an even sharper 64% decline. Yearover-year sales are also down 65% in Calgary and 16% in Montreal. Edmonton is the outlier with a 9% increase in condo unit sales, in contrast to the 21% decrease in single-family home sales in that market.
FUTURE LAGS AND PROSPECTS
That’s not expected to fully flow through to construction employment and the development supply chain until later this decade. New housing (single-family and apartment) starts have dropped off to a greater degree in the GTA, but are expected to be largely on par with 2024 — surpassing 250,000 units — nationally.
“The starts that are happening this year are sales that took place in the frothy period of 2022-2023. They’re still getting going in many markets,” Norman said. “The decline in sales is not going to be fully reflected yet. That will come ahead, but we’re still seeing a relatively robust housing environment, at least for the next couple of quarters.”
Canada-wide, multifamily construction starts are steadily shifting to purpose-built rental projects, which account for about 70% of development that has broken ground to date in 2025. Investors also continue to favour existing rental apartment buildings. Multifamily residential in suburban Vancouver emerged as the top choice among 30 possible
combinations of asset types and markets in Altus Group’s Q3 2025 survey of 400+ clients’ attitudes toward investment.
Norman warns that slower population growth is going to eat into the 20-to-35-yearold demographic of apartment dwellers, but points to a source of potential renters that could be tapped.
“Whether or not there’s going to be an excess supply of really small units depends
on how quickly the pricing of that supply unleashes a lot of the pent-up demand,” he mused. “We may not have a lot of net growth of people in the ages of 20 to 35 in the next 10 years, but those of them who are living in their parents’ houses right now is where a lot of our demand is going to come from, if an adjusted rent can incentivize them to move out of those houses.”
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Making Space for Diverse Perceptions SENSORY STEERING
By Rebecca Melnyk
THE BUILT ENVIRONMENT is rife with sensory stimuli that can pose barriers to people who could be valuable contributors in the workplace. An estimated 15 to 20% of people in North America identify as neurodivergent, but this figure likely underestimates the true scope.
All people fall somewhere along a sensory continuum, from those who are hypersensitive (sensory avoiders) to those who are hyposensitive (sensory seekers), with neurotypicals (sensory neutral) in the middle. Neurodivergence refers to natural variations in thinking, feeling, communicating and interacting that deviate from conventional expectations, including in ways that can upend entrenched outlooks and expand organizational skill sets.
A recent webinar, sponsored by the Business and Institutional Furniture Manufacturers Association (BIFMA), explored approaches to design, facilities management and human resources that can better accommodate that range of
dispositions in order to enhance workers’ experience and workplace productivity.
“Our spaces, policies, processes and organizations should be fluid to allow people to be in a space that makes them feel comfortable and bring their best self to work,” maintained Tara Cunningham, Chief Executive Officer of the consulting firm, Beyond-Impact.
That’s a perspective Kay Sargent, Senior Principal and Director of thought leadership with the design firm, HOK, also embraces.
“This is about everyone,” she asserted. “I don’t know anybody that is immune to being impacted by light, sound, temperature, proximity — all of those things in the built environment.”
Nor are people rigidly affixed in the sensory continuum.
“We are all operating on different brainwaves at any given moment,” Cunningham said. “There is no neurotypical; there is no normal. Every day we come into the world differently.”
DESIGN CONSIDERATIONS
Some fairly simple, cost-effective features can mitigate sensory overload. For example, uncertainty about policies, unspoken rules and how things operate can be intimidating for people entering unfamiliar environments, but some basic design elements — like wayfinding signage or windows with adjustable blinds — can make expectations more visible and help people feel comfortable and confident in their surroundings.
HOK has identified 13 design considerations, which were devised with design professionals’ input and further refined through surveys and research initiatives, for creating human-centred space. These emphasize the importance of offering choice — including space to move and fidget and for solitary concentration. Environments with little visual clutter, acoustic controls, adjustable lighting, ergonomic furniture and natural elements rank highly. While it’s next to impossible for organizations to truly understand the perceptions and
ASSURANCE FOR CRITICAL-MISSION DESTINATIONS
By Katrin Ferge
Cleanliness and functionality have long been the benchmarks for assessing public bathrooms, but there are other equally important factors for many users. Inclusive hygiene encompasses various design and maintenance considerations that can respond to a broader range of individual abilities and circumstances.
Recent research suggests 59% of Canadians contend with some form of physical or cognitive challenge that can downgrade their experiences in public bathrooms. Some typical impediments include: loud air-dryers that overwhelm auditory and neuro sensitivities; paper towel dispensers that are out of reach or require users to command fine motor controls; or harsh soaps that trigger skin sensitivities.
In a recent survey, 44% of respondents revealed they feel anxious about using public bathrooms and often plot out logistics around access, and 52% reported that they have adjusted their behaviour after a negative experience. The latter includes filing complaints and/or limiting what they eat or drink to avoid using public bathrooms.
Inclusive hygiene has a wider scope than the physical accessibility standards in the Accessible Canada Act — recognizing that many barriers are not visible, and that hygiene experiences are shaped by greater context, not just compliance.
Inclusive hygiene asks:
• Does the bathroom feel safe and clean?
• Does it offer privacy and comfort?
• Does it reflect care and consideration for all users?
The Inclusive Hygiene Playbook is a research-informed guide based on interviews with users, cleaners and facility managers across 20 North American cities, including Toronto. From this work, three key design principles have emerged.
A clean and safe environment is paramount. Cleanliness is not just about sanitation; it’s about how safe a space feels. Overflowing trash, exposed toilet paper rolls and damp handles signal contamination.
Bathrooms should be a refuge. Visitors are seeking relief, not stress, yet, many report feeling overwhelmed by harsh lighting, unpleasant odours and lack of privacy.
The bathroom should feel cared for and reflect a facility’s professionalism and receptiveness. Generic signage, unclear cleaning protocols and inaccessible fixtures can make users feel unwelcome or confused.
Facilities across Canada — in urban, suburban and rural areas — serve populations with wide-ranging needs. Canadian legislation and public sentiment are moving toward greater accountability in accessibility. Inclusive hygiene offers a proactive way for facility managers to align with these values while improving user experience.
The Inclusive Hygiene Playbook can be found at www.torkglobal.com/us/en/about/inclusivehygiene#playbook. Katrin “Kat” Ferge is the North American Regional Marketing Manager for Professional Hygiene – Commercial at Essity, a supplier of hygiene products. For more information, see the website at www.essity.com.
experiences of everyone coming into their facilities, Janet Roche, Chief Executive Officer and Co-founder of the TraumaInformed Design Society, argued that they do need to recognize the responses a space can trigger, which could be rooted in neurodivergence or trauma. Her team has developed some guidelines to provide the flexibility to support a range of needs.
That’s based on a variety of spaces tied to the “six modal modalities of work” — deep concentration; contemplation; communal solo work; creation; congregation; and socializing — each incorporating considerations for hyper- and hyposensitive individuals.
“Someone who is hyposensitive might not
want to go into a small box to concentrate,” she observed.
Similarly, hypersensitive workers don’t need every space to be subdued. Quiet spaces should truly feel quiet with lower lighting, calming tones and structure, but social spaces can be vibrant and lively with pops of colour.
“Even if you’re hypersensitive, nobody wants boring spaces,” Sargent reasoned. “They just want structure and control. They want those pops in their day, of interest and delight, but just don’t want to be subjected to it all day long.”
The configuration of spaces is equally important. Sargent cited the common bad example of a gathering area located at the
centre of an open-plan office, thus creating conditions for the resulting hubbub to reverberate outward to alleged quiet zones at the outer edges.
“The open plan often gets a bad rap. Done well, it can be really effective. Done poorly; it’s a disaster,” she observed.
POLICIES AND PROCEDURES
Space configuration and design are only part of an inclusive workplace. Culture, processes, policies and everyday practices also play into it.
For example, job descriptions riddled with corporate jargon and acronyms impart an insiders’ insularity that can discourage neurodivergent women, people of colour and individuals from underrepresented groups from applying. Cunningham recommends clear, concise prose that focuses on what the job requires and how that role complements the company’s larger mission.
Once hired, new employees will need the key to what she calls “the hidden curriculum of workplace norms” that are rarely explicitly communicated. A commonly accessible glossary of acronyms, posted on the company’s intranet, can help solve some of those mysteries.
Policies and procedures should be formally spelled out. If someone works late, they should know they can start later the next morning. Similarly, work-from-home policies should be clearly communicated to all staff to circumvent resentment that might be directed toward people who have been accommodated.
Internal performance metrics should also be considered. For example, people on the autism spectrum may not be comfortable communicators so performance evaluators may need to weigh communications-related skills differently.
Ideally, it should all come together in what Sargent characterizes as a “threelegged stool” underpinned by environment, operations and personal adjustments. Space design and configuration create the environment. Operations involve recruiting, onboarding and training. Personal adjustments respond to preferences and needs and provide access to tools like noise-cancelling headphones.
“One leg of a stool isn’t going to keep you standing or sitting up,” Cunningham reiterated. “We need to really revise the way things work.”
Rebecca Melnyk is the Editor of Canadian Facility Management & Design.
When it comes to
retrofits,
mid-tier buildings are in a class of their own
Mid-tier buildings and their owners and operators are essential for Canada’s retrofit revolution
Mid-tier buildings play a fundamental role in Canada’s commercial real estate landscape – and in lowering the country’s carbon emissions targets.
Increasing the depth and rate of retrofit projects to improve the energy efficiency of older commercial and multifamily buildings is a priority for the federal government.
Natural Resources Canada’s Deep Retrofit Accelerator Initiative puts that goal into action by providing funding to organizations, AKA “retrofit accelerators,” to help building owners and managers access educational and financial resources to upgrade their properties.
You may be asking at this point – what exactly is a mid-tier building, and why do retrofit programs target them?
Why a Waterloo A could be a Toronto B
Commercial building types can be broken down by class according to their distinct characteristics. It should be noted that their designations are relative to local market standards and office space inventory. For that reason, a Class A building in a small town may not be classified the same way in larger urban centres.
Class A: These high-rises are prestigious assets set in prime locations. Built or refurbished to high standards, they attract premier tenants with top-tier amenities and have some of the most expensive rental rates. This class of building is typically managed by large institutional landlords and professional teams.
Class B: These buildings range from mid to high-rise and are often at least 10 to 20 years old. Finishes and systems are usually well-maintained and functional and feature moderate amenities. With less prestige than Class A buildings, they tend to have lower rents that appeal to a broader range of clientele.
Class C: These buildings are normally mid to low-rise, are more than 20 years old, and have the lowest usable grade for commercial buildings. They have minimal amenities and may be located in suburban communities. These properties tend to have outdated or obsolete technology and require extensive renovations – perfect for an investor targeting spaces to redevelop.
Challenges and conflicting priorities
Retrofitting a mid-tier building is a complex process at both the decision-making stage and throughout project execution.
Unlike Class A properties, ownership of Class B/C properties is often fragmented between a mix of commercial real estate professionals and nonprofessionals, who possess varying understandings of the industry. This melange includes private investors, family trusts, small REITs, or pension fund portfolios.
When the time comes to upgrade building systems, independent owners without strong institutional backing may face capital limitations, and not know the full range of costs, scope or resources available to them. Replacing outdated infrastructure can be extra challenging – and expensive – if the building is filled with working tenants or occupants.
With so many potential players and factors to take into consideration, it’s not uncommon for building owners and operators to encounter conflicting priorities when deciding how – or even if – to proceed with building retrofits. With or without professional management, there are ways to balance practical needs and strategic action.
A great first step is to join a peer group, like a local BOMA association, where operators can access support and educational resources to learn about funding pathways for retrofit projects, including existing government grants and loans.
To go further, mid-tier building managers can apply to participate in deep retrofit accelerator programs, like the nation-wide BOMA Enspire program. Through educational training sessions, workshops, and industry events, this program teaches operators to unpack the fundamentals of retrofit planning and identify opportunities to get started on their energy-saving journey.
Mid-tier buildings are essential to Canada’s energy efficiency evolution and account for close to 65 per cent of the building stock.
Just below Class A in prestige but critical in affordability and community, mid-tier properties are an essential component of Canada’s built spaces.
Building operations are a huge portion of energy emissions in Canada and retrofitting Class B and C buildings has an important impact on meeting the country’s carbon emissions targets.
The key for operators is to blend day-to-day management with strategic upgrades through government programs, retrofit partnerships, and smart financial planning.
With these tools, mid-tier operators can improve tenant experience, lower emissions, and increase asset value without needing a premium budget.
If you represent a Class B or C building in Canada, check out the BOMA Enspire program today to see if you’re eligible for funding support!
LEASING LIFT
Return-to-Office Mandates Boost Occupancies
COMPANIES READYING for a shift away from remote staff have spurred an office leasing resurgence in some cities and economic sectors. Most noticeably, CBRE Canada reports 1.6 million square feet of positive absorption in Toronto during the third quarter of 2025, primarily occurring in downtown Class A space. Drilling deeper, Altus Group pegs the availability rate for premium downtown office space in Class AAA buildings at 7.9%, down from 10.6% about a year ago.
“A lot of the activity that we’re seeing right now is facilitating back-to-the-office. It’s banks and other organizations that are trying to accommodate employees who are coming back because of company mandates,” Ray Wong, Vice President of research and data analysis with Altus Group, reported during a recent online presentation. “We’re seeing some competition among some of these tenants for securing the space, and certain firms being outbid for certain locations. We’re definitely seeing a decrease in tenant inducements.”
After 2.3 million square feet of new office supply came onto the downtown Toronto office market in 2024, just 53,000 square feet has arrived thus far this year. Large blocks of contiguous space are becoming rarer in AAA buildings, where the direct vacancy rate is now 1.6% (down from a high of 4.% in Q1 2022).
Wong speculates the next tier of Class A space “that is slightly less amenitized compared to the triple-A” could be positioned to gain from a leasing uptick that’s expected to continue into 2026. Many employers, including the Ontario government, have set a January start-date for required five-day-aweek office presence.
That said, 1.86-million square feet of office space is still under construction in downtown Toronto and he predicts a shortage of Class AAA space is at least three to five years in the future. Nor is the return of remote staff reflective of companies in growth mode. If anything, Peter Norman, Vice President and economic strategist with Altus Group, hypothesizes it’s a symptom of economic uncertainty.
CLASH OF AGENDAS
“When the labour market is weak like it is right now with high unemployment, that’s when we’re going to see more work-in-office mandates. When labour markets get tight again, which they will pretty quickly, that’s when we’re going to see more flexibility,” Norman said during the Altus online overview of 2025 market conditions.
Illustrative of some employees’ preferences, the central employee relations committee (CERC) of the Ontario Public Service Union has filed an application with the Ontario Labour Relations Board to challenge the provincial government’s return-tooffice mandate, arguing that it is “premature” and violates the collective agreement. The committee is also encouraging workers to file individual grievances.
“CERC wants to be clear: we do not support this mandate! It is disruptive, inequitable and dismissive of the proven success of remote and hybrid work models that OPS members have managed effectively for years,” a recent statement declares.
Meanwhile, a majority of recent survey respondents (57%) support the federal government’s hybrid approach that requires non-executive employees to spend at least three days per week in the office and executives to be on-site at least four days per week. Those results are gleaned from roughly 1,900 respondents the Angus Reid polling firm surveyed in July 2025, which included a mix of workers in the private, public and notfor-profit sectors.
“On the issue of a full return to office for federal workers, there appears to be differences of opinion among those who have experience working from home, and along generational and gender divides,” the accompanying analysis observes. “Those who have some experience working from home are more likely to be opposed (64%) than those who have never done so (47%). As well, public sector employees express more opposition (53%) than those employed in the private sector (44%). A majority of older Canadians (59%) and half of men (52%) believe hybrid work for federal civil servants
should end. Women and Canadians under 35 are less in favour of ending remote work for the federal public service.”
Norman maintains the COVID-19 pandemic rapidly accelerated a trend that was already in progress and, moreover, proved that organizations can function effectively with a combination of on- and off-site staff. The sudden shift to home-based work perhaps also minimized employee pushback that might otherwise have slowed the rollout of space rationalization strategies. Many office workers are now returning to a fait accompli.
“Remote work is part of the issue of slow absorption in the office market, but another big part of it has been the efficiency revolution of space,” Norman submitted. “That’s ongoing and something that’s going to continue to be felt.”
Yet, some employers may now be discovering they’ve squeezed their footprints too tightly. That’s a scenario senior real estate executives recently contemplated during a larger discussion about the state of downtowns during the Building Owners and Managers Association (BOMA) of Canada’s annual national conference, BOMEX.
“Some of those that gave up some of their office space are now finding out they don’t have enough space for their people. They’re getting congested and the quality of the experience is not as good,” said Ben Young, President and Chief Executive Officer of Southwest Properties Ltd.
MIX OF INFLUENCES
BOMA Canada’s 2024 yearbook flags downtown vibrancy and the impact of remote and hybrid work among four issues that are keeping the commercial real estate industry awake at night. (ESG requirements and technological disruption are the other two.) There is something of a circular cause-andeffect to both concerns since downtown dynamics typically influence workers’ attitudes about the office, while workers’ presence, or absence, affects the liveliness of downtown districts and the prosperity of other types of businesses located there.
“The back-to-office movement has lagged in Ottawa and the retail there is really struggling. So how do they keep those retailers alive to get the downtown revitalized?” Young mused.
Setting the context for the panel discussion, BOMA Canada’s President and Chief Executive Officer, Benjamin Shinewald, suggested that this year’s BOMEX host city,
Halifax, stands in contrast to many Canadian cities for its vibrant, clean and safe downtown.
Concomitantly, Class AA downtown office buildings in Halifax and Vancouver are the only two categories of office property to achieve positive investor sentiment in Altus Group’s Q3 2025 survey of 400+ clients’ attitudes toward 30 different combinations of asset types and markets. Nine other categories of office and five categories of office land are ranked in the bottom 15.
“At BOMA Canada we’re spending a lot of time talking about how to build coalitions around downtown revitalization, working with other organizations as well,” Shinewald advised. “It matters to the vibrancy of our economy, partly because our assets are heavily downtown-based. If they start falling in value, that’s bad for the economy, and it becomes a vicious cycle because the property taxes will only rise to make up for the difference.”
Traffic congestion and downtowns that are devoid of attractions or perceived to be unsafe can make the office a tough sell to workers who have the option to avoid it. That’s particularly true for workers who aren’t engaged with their colleagues, whether due to the nature of their work, personal preference or organizational inadequacy.
“If you factor those things, the majority of population will default to convenience if they have a good work-from-home situation,” acknowledged Michael Bansil, Senior Vice President, business excellence and innovation, with GWL Realty Advisors.
Return-to-office mandates now present some potential to lure back the reluctant, along with the risk of reinforcing their disenchantment. While it is primarily employers’ role to foster workplace culture, their landlords provide operational basics that can enhance or undermine how workers function and feel about their environment.
“We can’t dictate whether tenants have in-office mandates. We can control our assets,” Bansil reiterated. “That’s making sure that our assets are high-quality; they’re well amenitized; we have strong customer service; we have strong technology that helps with the customer experience, etc.”
Looking at where government investment could help, Judy Wall, President of East Port Properties, calls for public transit improvements and logistical innovation, such as harnessing artificial intelligence (AI) to better manage downtown traffic flow. She urges local governments to
workplaceenvironment
explore options to adjust traffic light intervals or switch from one-way to two-way street directions in real-time, as needed.
“One of the reasons people don’t want to go downtown is because it’s congested. It’s
WINDOWS & DOORS ALUMINUM & VINYL
hard to get around; they lose too much time; maybe it’s all one-way streets or there aren’t any lefthand turns,” she said. “We need to figure out how to move people around more effectively. That’s quite separate from the issue of whether we have an oversupply or undersupply [of office], but it all works together to make a downtown.”
COMPANY CULTURE
Management flexibility can also be part of the formula. Young cited his company’s allowance for staff to choose their start and departure times to skirt peak traffic periods, but noted that such policies come with the risk that latecomers or early-leavers will feel judged and defensive for being out of sync with other colleagues’ hours.
“It’s a cultural thing. You have to create that sense of comfort that you trust your employees and that everybody’s going to work a full day,” he maintained.
BOMA Canada’s recent survey of young commercial real estate professionals uncovered similar issues, with some respondents lamenting that their supervisors unduly value physical presence in the office
over substantive contribution. However, a majority of participants rated their employers’ flexibility around hybrid work as either “very good” or “excellent”.
Even so, some of the same savvy young professionals endorse in-office work for its career-building spinoffs. While addressing key issues for emerging leaders during another BOMEX forum (see story, page 52), they characterized the office as a venue for structured and casual interaction that supports the development of both hard and soft skills.
“I think it’s important for the next generation to be back at the office. You need that daily touch-point with your team,” asserted Raisa Hussain, a Senior Property Manager with Colliers Canada.
“I do think remote work is lovely, but return-to-office is essential for young people to learn from the people around us,” concurred Michelle Kinsella, Director of integrated program delivery for RBC’s Canadian retail branches. “It’s really hard to do that remotely. You miss a lot of those quick conversations with colleagues that you learn so much from in the office.”
The Commercial Real Estate landscape is changing. Property managers and stakeholders look to BOMA Toronto for educational support and resources to help navigate critical issues, deliver operational excellence, and inspire success. Build your skills. Build you network. Build your career.
Emerging Leaders Contemplate Commercial Real Estate’s Professional Culture
By Barbara Carss
THERE’S NO PRECISE RECIPE for workplace productivity, but young professionals pursuing a future in commercial real estate suggest some staple ingredients. Those who participated in a recent survey conducted by the Building Owners and Managers Association (BOMA) of Canada rank mentorship and investment in professional development, appreciation of work-life balance, empathetic leadership and corporate practices that reflect industry trends and/or socially responsible principles among attributes that attract them to and keep them with an employer.
The survey draws insight from 52 managers and specialists in the early stages of their careers, working in commercial real
estate’s various disciplines throughout Canada. Earlier this year, they were asked to respond to eight questions about their work environments, additional supports they would value, and pertinent education and networking events that BOMA Canada’s Emerging Leaders program could facilitate.
Aligned with the latter initiative, three young professionals drilled deeper into themes linked to the survey findings during a forum at BOMA Canada’s annual national conference, BOMEX, in mid-September.
Survey results indicate many real estate employers are winning approval from young professionals. Nearly 79% of respondents said their organization supported career growth and a majority said they enjoyed either “excellent” or “very
good” flexibility around allowance for hybrid work. Employers were commended for providing mentorship, leadership training and networking events and for fully or partially covering fees for professional development programs and courses. Nevertheless, the wish list for additional supports is somewhat longer. By definition, emerging leaders are relatively new to managerial roles, and they identified various challenges on that learning curve. Respondents were relatively evenly split in what they ranked as the outcome they would most like to achieve, but the largest share (27.5%) chose “work-life balance”. Equal quotients (21.5%) seek to master “effective delegation” and “prioritizing competing demands”, while
about 12% are striving for “transparent leadership”.
In turn, they envision assistance arriving along a range of possible avenues, but structured guidance, experiential learning and opportunities to share experiences with peers and confer meaningfully with senior executives are most in demand. There is also a call for tools to help deal more proficiently with mundane tasks — a request that seems to complement respondents’ interest in learning more about artificial intelligence (AI) and technology.
SUBSTANTIVE SUBTLETIES
Speaking to BOMEX delegates, Raisa Hussain, a Senior Property Manager with Colliers Canada in Toronto, sketched out her strategy for two tracks of her career progress since entering the field six years ago. She’s taken a largely self-directed approach to acquiring and refining many of her job skills, while reaching out to others to help demystify some of the intangibles.
“Mentorship is like GPS for your career,” Hussain asserted. “The technical side of things — leases, budget, operations — the numbers weren’t the problem. I learnt how to navigate those and I taught myself through courses. What I didn’t know was how to navigate a room where decisions were made, how to make my voice heard or how to build that relationship that truly opened the doors.”
She credits enrollment in BOMA International’s Daniel W. Chancey Leadership Academy for opening up that path. The program, which was previously known as the BOMA Fellows Leadership Academy, pairs a maximum of 15 candidates in each annual cohort with a mentor from among the select group of real estate leaders who have received the rare honorary distinction of BOMA Fellow.
Hussain was matched with another Canadian, Keith Major, a prominent real estate executive, a BOMA International life member who served two terms as the association’s secretary/treasurer, and a recipient of the BOMA Canada Chair’s Award.
“Keith stood out to me, not just for his career achievements, but for his calm, steady demeanor,” Hussain recounted. “He never told me what to do. He helped me see where my energy was best invested and which path might be worth pursuing or which was not a fit for me.”
It’s such traits and approaches that Hussain’s co-presenter, Michelle Kinsella,
Director of integrated program delivery for RBC’s Canadian retail branches, underscored in her analysis of skills employers would be wise to proactively foster. She lists collaboration, communication, problem solving, time management and conflict resolution among the suite of “soft skills” tied to interpersonal skills and emotional intelligence — and contends there is a deficit in many commercial real estate workplaces, which is perhaps tied to an industry bias toward technical proficiency.
“Here’s the disconnect: we hire for technical skills and fire for soft skills,” Kinsella observed. “Some of the top concerns for property owners, tenants and customers aren’t about the technical aspects of commercial real estate. They’re about the essential skills that often go unmeasured: clear communication with stakeholders; empathy for tenants’ business needs; adaptability in response to changing market conditions; and active listening to maintenance requests.”
Changing workplace culture could be exacerbating the dilemma. Email and text based communications now predominate, but they are generally clumsier at imparting nuance and emotional cues and more open to misinterpretation than person-to-person conversations.
That’s happening after COVID subverted many of the conventional formative opportunities — on post-secondary education campuses, in workplaces and social settings — for young adults to refine social skills, and AI now threatens to further erode human interaction. As a result, though, employers may becoming more conscious of voids that need to be addressed.
“Most employees anticipate this will increase the need for soft skills such as empathy, critical thinking and leadership as a way to differentiate from AI,” Kinsella maintained.
INTENTIONAL APPROACHES
She urged young professionals and organizational decision-makers alike to take an intentional, structured approach to acquiring and cultivating those skills. Both Kinsella and Hussain outlined their own efforts to get involved in projects, campaigns and peer review exercises within their organizations, the industry and the broader community, which have involved group deliberation, consensus building, public speaking and exposure to diverse expertise and perspectives.
While it’s important for advancement can-
didates to be open to feedback, it’s perhaps even more important for their supervisors to provide constructive guidance. Companies can adopt training, tools and resources to develop and reinforce productive leadership qualities that give employees the confidence and morale to contribute and excel.
“We can practice active listening. We can keep an open mind and look for common ground in what we can learn from different people. We can identify our own emotional triggers and work on responding rather than reacting,” Kinsella tallied. “The more we can manage ourselves, the better we can relate to others.”
Young professionals are likewise contemplating how their work connects to broader society. Respondents to BOMA Canada’s survey indicate that they want company practices and priorities to align with their values and keep pace with evolving trends. Sustainability, mental health and transparency in corporate dealings with staff, clients, investors and the public are all identified as important.
“They also wanted more environmental, social and governance (ESG) considerations to become a greater priority in CRE,” the survey report states. “Firms that provide concrete implementation strategies will likely have a stronger competitive advantage.”
Reflective of those concerns, the third BOMEX presenter, Caleb Solomons, Director of interior design for HOK in Calgary, focused on accommodating neurodiversity. He mapped out the extensive range in how people perceive and respond to sensory stimuli, and highlighted the potential productivity and competitive benefits of design and operational measures that take hypersensitive and hyposensitive workers into account.
“Individuals who are coming into the buildings we design and manage are identifying this need. We’re seeing those conversations around neurodiversity happening at the C-suite and being woven into governance,” Solomons noted. “The same kind of concepts were part of solving for sustainability, for wellness, for highperformance employee productivity. I think what’s really great about this neuroscience is that it’s going to be more fuel in the furnace as it relates to the built environment getting better, stronger and healthier.”
More information about BOMA Canada’s Emerging Leaders program can be found at https:// bomacanada.ca/emerging-leaders.
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
REVEALING REPORTING
Non-profits to Share More Info with Canada Revenue Agency
By Barbara Carss
INDUSTRY, TRADE and professional associations, condominium corporations and other entities that Canada Revenue Agency (CRA) classifies as non-profit organizations may be called on to report more information about their finances, activities and leadership beginning with filings for the 2027 tax year.
Proposed amendments to the Income Tax Act, first outlined in the federal 2024 Fall Economic Statement, represent new efforts to enumerate a segment of the tax-exempt sector that has been largely unquantified. These would lower the threshold that triggers when non-profits are obligated to file
an annual information return with CRA, and would introduce a new “short form” of required information for all entities not captured in the first case.
Following a public consultation earlier this summer, the recently released 2025 federal budget confirms the Canadian government
will be implementing the measures with possible modifications. The initially proposed start-date for the 2026 tax year has already been deferred.
“The government is reviewing the feedback it received from consultations with stakeholders and will release final proposals in due course that minimize any additional administrative burden and clarify which organizations are, or are not, subject to the new requirement,” the budget document states.
Knowledgeable observers theorize the new reporting criteria are tied to a broader agenda than just traditional concerns that organizations could be holding undue cash stockpiles that have grown via tax-free interest. There’s now a thrust for closer
“There would be greater transparency with these proposed new filings to allow Canada Revenue Agency to look into these organizations if there is any need for investigation or enforcement.”
monitoring, which was highlighted when the measures were first announced.
“The 2024 Fall Economic Statement also announces the government’s intent to launch interdepartmental dialogues with non-profit organizations to deepen awareness, enhance communication and better combat money laundering, terrorist financing and sanctions evasion risks,” it states.
Under current rules, non-profits that accumulate more than $10,000 in passive income in a fiscal period or hold total assets surpassing $200,000 in value must file an information return with details about:
• revenues earned;
• assets and liabilities;
• remuneration paid;
• organizational activities; and
• record-keeping practices.
It’s proposed that they would additionally have to report if their total gross revenues surpass $50,000 per year.
“Canada Revenue Agency has the Charities Directorate, but the not-for-profit sector doesn’t have a specific oversight body within the CRA that has a sole mandate, like the Charities Directorate with respect to registered charities, to ensure this sector’s money is properly used and not misused or subverted,” explains David Tang, a partner who specializes in charities and not-forprofit law with Miller Thomson LLP.
“There would be greater transparency with these proposed new filings to allow Canada Revenue Agency to look into these organizations if there is any need for investigation or enforcement.”
CONDO CORP REDUNDANCY
Drilling down to the sub-sector of condo corporations, some accountants characterize both the existing and contemplated enhanced requirements as burdensome duplication for
incorporated entities that are already mandated to file annual tax returns.
Stephen Chesney, a partner with YalePGC Chartered Professional Accountants, confirms more than 50% of the roughly 700 condo corporations for which his firm provides auditing services currently file annual information returns with CRA. That would jump to more than 99% under the proposed new reporting threshold.
“A lot of non-profits, if they’re not incorporated, do not have to report to the government now so that’s likely why they are looking for this information,” Chesney speculates. “We file a corporate tax return for every condo. So why do they need this?”
Nor does he see much differentiation between the proposed elements of the new short form and what’s currently required in the information return. “To me, it looks like it’s a new long form,” he observes.
Notably, the existing information return does not ask for details about an organization’s directors, trustees or officers, but both the 2024 Fall Economic Statement and the government’s subsequent consultation document list this information as an element of the proposed new short-form document for non-profits with more modest revenues and asset holdings. That may also be a hint of future modifications to information requirements for wealthier entities, which would be a new information-gathering exercise for accountants serving the condo sector.
“Condos in Ontario already report the names and addresses of their boards of directors to the Condominium Authority of Ontario (CAO) and that information has to be updated annually,” Chesney says. “So it would be more duplication, but it would also be more work for the people preparing the CRA forms because they would have to put all those names in.”
TAX-EXEMPT SPECIFICATIONS
Non-profits are defined in the Income Tax Act as clubs, societies or associations that are organized and operated for reasons other than making profit, such as social welfare, civic improvement or educational, cultural and recreational pursuits. Tang notes that such organizations are expected to largely “run flat” with incoming revenues balancing out their operating expenses. Beyond that, there is a stipulation that the income a non-profit generates cannot flow through to the organization’s members as direct payouts or other kinds of financial benefits.
There are separate rules to govern registered charities and charitable foundations, which, like corporations, are required to file annual tax returns. A more rigorous level of oversight is associated with providing donors and federal and provincial/ territorial governments that grant tax credits with assurance that charitable organizations are fulfilling their missions, whereas non-profits that aren’t incorporated and don’t meet the current threshold for submitting an annual information return are essentially invisible to CRA.
“The proposed new reporting requirements create the capability to understand that part of the sector,” Tang says. “For example, the simplified form will identify who the directors and trustees of these organizations are because, otherwise, there’s not necessarily any way to know at all.”
It’s proposed the new short form for smaller non-profits would also ask for: the organization’s name, mailing address and business or trust number; its total assets, liabilities and annual revenues; a description of its activities and whether
Berkley_CPM_Winter_2023_FINAL.pdf 1 2023-11-17 11:08 AM
those occur solely within Canada or further afield; and other potential information that might be prescribed in the future.
“We don’t know yet, but presumably there’s not going to be any real enforcement activity for really, small informal organizations that don’t conduct enough business to warrant a business number,” Tang muses.
On the flipside, many of Canada’s more prominent industry, trade and professional associations are incorporated and most will already be submitting the annual information return. Some may also earn significant revenue from membership fees and other programming products, but this is where the second prong of tax-exempt status — prohibition on flow-through financial benefit to members — comes into play, as revenues are invested back into operational activities.
“Associations do a whole lot of things, including setting standards, undertaking research and providing education so that the members of an industry or profession can deliver a higher level of service, knowledge and professionalism that is a benefit to the public,” Tang says. “That’s the idea behind the tax-exempt status — that this is a benefit not just to members, but to society as a whole.”
ENFORCEMENT MIXED MESSAGING
Meanwhile, Chesney suggests that philosophy has not been so clearcut in the condo sector, where tax-free revenues are often applied to offset operating expenses that condo fees would otherwise have to cover. This can be construed as a financial benefit to unit owners and an unfair advantage over single-family homeowners who would have to pay tax on similar types of income.
To date, CRA has conveyed mixed messages about the fairly ubiquitous ways condo corporations generate extra revenue, through rents from rooftop telecommunication installations, guest suites and party rooms, or even from the sale of common space, such as a superintendent’s unit. Following a past random audit of non-profit organizations, Chesney recalls that numerous condo corporations received cautionary letters about identified inappropriate income, but there was no follow-up action.
“I am not aware of any condo corporation in this country that has ever been assessed any type of penalty for earning income that it shouldn’t be earning,” Chesney says. “I get dozens of calls from my clients every year asking about the tax implications of these kinds of things and whether it will affect their non-profit status. My answer is: I don’t know because that’s never happened yet. It seems the only thing CRA has used the information returns for is to fine condo corps when they don’t file them on time.”
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Military Housing Battles Fatigue
PLANS TO ENLIST the private market in military housing provision could help Canada’s department of National Defence reduce a growing shortfall between supply and demand, but there is no funding yet in place to advance that campaign. A recent report from the Auditor General of Canada uncovers shoddy oversight in the existing portfolio of roughly 11,700 residential units and 26,000 dormitory bed spaces, and concludes National Defence and its affiliated Canadian Forces Housing Agency are not meeting their mandate to provide for the needs of military personnel.
“National Defence’s own research has shown that housing is an issue that can negatively affect the well-being of military families, with impacts on retention,” the report states. “To meet operational needs, Canadian Armed Forces members can be required to move frequently. It is important for their morale and well-being that they can access affordable housing in good condition with sufficient living space for their needs.”
The auditors critique inadequate upkeep and a mismatch of unit types to occupier need that’s resulting in unfavourable living conditions and long waiting lists for aging stock. That’s partly attributed to fragmented management across 27 army, naval and air force bases and the lack of centralized coordination of asset condition assessments, capital planning and maintenance priority setting. Further muddying transparency, National Defence lumps housing accommodations in with facilities such as warehouses and hangers in its infrastructure budgeting and expenditure reporting.
The audit covers a 24-month period, from April 1, 2023 to March 31, 2025, and scrutinizes the two complementary elements of the military housing portfolio:
• furnished, dormitory-style accommodations in 318 buildings, primarily intended to house Forces members on training courses, short-term assignments
or in transit between operational locations; and
• longer-term housing located on military bases, of which nearly 80% is familyoriented units with at least three bedrooms.
The private sector is already a significant provider of housing for military personnel given that only about 17,000, or 26% of the approximately 65,000 Forces members lived within the National Defence portfolio as of this spring. The portion living offbase is expected to grow as the Canadian government seeks to boost the ranks to 71,500 before the end of this decade.
A relatively new housing benefit, introduced in July 2023, helps junior ranks cover those costs. It provides a subsidy to reduce renters’ accommodation costs to no more than 25% of their gross salary, with the maximum allowable subsidy based on the average rental cost of a two-bedroom unit in the market where the base is located. Nearly 12,200 Forces members qualified for the benefit in the first year it was on offer, equating to a payout of $72.3 million.
“The benefit is designed to provide greater assistance to junior ranks and either less or no assistance to higher ranking members who were in a higher salary band,” the audit report states.
The auditors note that Forces members who require more than two bedrooms to accommodate their families would likely have to pay more than 25% of their incomes, even with subsidies, to rent more spacious and presumably pricier homes. In contrast, all military personnel who live within the National Defence portfolio pay rent that is capped at 25% of the member’s gross pay, excluding utilities.
Wi-Fi may not be one those of the utilities, however, since the auditors also report that it is one of the “modern amenities” sometimes lacking in aging
dormitory space. Nevertheless, there’s no shortage of prospective tenants.
As of this spring, more than 3,700 applicants were waiting for an opening, while just 205 longer-term residential units became available. About two-thirds of military personnel on that waiting list are single individuals.
A current plan to build 1,400 new residential units and renovate 2,500 existing residential units on Forces bases — budgeted to cost $2.2 billion over a 19-year period — already lags the targeted need.
Housing availability has actually slipped slightly since May 2019 — falling from 11,798 to 11,741 residential units. The auditors calculate a shortfall of 3,800 to 5,800 units, and call for an updated overarching military housing strategy to reflect the envisioned 71,500 military personnel.
The auditors flag some “innovative options to obtain additional housing” that National Defence is pursuing, including reserving market rentals and/or bulk leasing housing units in the private market and partnering with private sector developers to develop military housing. For now, those strategies are described as “at different stages of implementation” with no actual funding in place.
“National Defence must address how it will meet its need for living accommodations,” the audit report asserts. “National Defence should complete its reassessment of the needs of the Canadian Armed Forces for residential housing. It should then update its cost estimate and plan to meet any shortfall and implement its plan in a timely manner. It should regularly update its assessment to consider future growth of the Canadian Armed Forces and changes in the geographical distribution of personnel.”
The Auditor General of Canada’s full report can be found at www.oag-bvg.gc.ca.
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Who’s Who 2026
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Leading professionals from all real estate disciplines will view the survey through our awardwinning print and online properties: Canadian Property Management; CondoBusiness; and Canadian Apartment Magazine, all part of the REMI Network. It will also highlight the top 10 portfolios of commercial, retail, industrial, apartment, and condominium properties.
To participate in the 31st ANNUAL WHO’S WHO IN CANADIAN REAL ESTATE INDUSTRY SURVEY, please email Gerald Ngan at geraldn@mediaedge.ca before February 14, 2026
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