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City building core strength with LeBreton: Plan will have major impact, experts say

When the National Capital Commission announced RendezVous LeBreton group as their preferred bidder in the competition to redevelop LeBreton Flats, it marked a major next step in the ambitious project that promises to transform Ottawa’s downtown core.

The bid backed by Ottawa Senators owner Eugene Melnyk beat out rival Devcore Canderel DLS Group, winning the right to enter into negotiations with the commission.

The $3.5-billion plan would include a new arena for the Ottawa Senators along with thousands of residential units, nearly three million square feet of retail and office space and several other amenities.

The redevelopment is the city’s most significant in the past half-century. Here’s a look at some of its possible ramifications.

Impact on commercial real estate

The RendezVous proposal is far more than just a hockey rink. The three-phase project calls for five distinct neighbourhoods on the 21-hectare site, including 4,400 residential units and 2.8 million square feet of retail and office space.

“If I were an investor or a landlord, I would be very bullish on LeBreton,” said Bruce Wolfgram, vice-president of tenant representation at Primecorp Commercial Realty. “It’s going to be a big deal.”

Mr. Wolfgram said he doesn’t think the LeBreton development will compete with downtown office market; they’re two separate markets. Rather, it will compete with some of the outlying suburban environments such as Kanata or the eastern part of the city, which already has high vacancy rates.

“I’m a little bit concerned looking way out in the long term about suburban office portfolios,” he said.

However, it will fall to those areas to find ways to promote themselves, he added.

“If you talk to many businesspeople in Ottawa right now, it can be a challenge to attract skilled workers to Ottawa,” he said. “Skilled workers want to come to a location in a city that’s exciting.”

The LeBreton redevelopment will also introduce some competition for the nearby billion-dollar Zibi development project on nearby Chaudiere and Albert islands.

Those communities, Mr. Wolfgram said, fit the live-work-play model in demand among younger professionals.

“The days of Ottawa rolling up the carpets at 5 p.m., I believe, are long over,” he said. “We’ve already seen that in the downtown core, and I believe we’re going to see that much more with projects such as LeBreton and Zibi.”

Darren Fleming, principal at Cresa Ottawa, said the new rink downtown can only be an “enormous plus” for the downtown core.

“Right now we have tenants making decisions about where they want to locate, and there’s some tremendous deals available in the core due to the sheer volume of space, but there’s a little bit of a lack of buzz sometimes,” he said. “This could really up the buzz factor.”

Retail downtown and in Kanata

On the retail front, two questions dominate: what impact will the new retail developments have on the downtown core? And what of the stores in Kanata near the Canadian Tire Centre, the Senators’ current home?

Mr. Fleming said he doesn’t think the spate of new retail options at LeBreton Flats will take customers from retail outlets nearby, such as those in Chinatown and on Preston Street.

“I really don’t think a new retail node in and around a rink is going to take away from what’s going on on Preston Street and in Chinatown,” he said. “I think it’s only going to add to it.”

It’s possible that some nearby businesses will want to move to LeBreton Flats, though the rents will likely be more expensive than their current locations.

In Kanata, Mr. Melnyk has said the team has a plan for the Canadian Tire Centre once the team moves downtown but hasn’t released further details.

Mr. Fleming said it’s hard to say whether retailers will want to remain in the area once the draw of the rink is no longer there. Big retail outlets there include the Tanger Outlet Mall, Home Depot and a host of car dealerships.

He said it’s difficult to say how they’ll fare without the arena as a draw.

“Are they strong enough to be draws unto themselves? Most developers would say yes, those would be anchor type uses in other developments, so they may be just fine,” he said.

Nearby Wellington West

Zachary Dayler, the executive director of the Wellington West BIA, represents businesses in Hintonburg and Wellington Village.

The challenge, he said, is to avoid “an island in the middle of the city that nobody goes to other than on game day.

“If you take a look at the current stadium, it’s great, but you go for a sporting event and you leave.

Critical to the success of LeBreton Flats is integration into the neighbourhoods around it.”

Mr. Dayler said that means consulting clearly and openly with local neighbourhoods and nearby businesses as well as exploring opportunities for local partnerships. He cited Hintonburger’s sponsorship of the Ottawa Champions baseball team as an example.

With Hintonburg already on an accelerated growth trajectory, the other difficulty will be travelling to and from the neighbourhood. The Senators say they want to have an arena built for the 2021-22 season, a project that won’t come without a few inconveniences for shoppers and commuters.

“Getting there I think is going to be a real challenge,” Mr. Dayler said. “There’s going to be a lot of construction, a lot of congestion, and that can be frustrating for people.

“Often when you look at plans, the plan simply deals with the site and not necessarily the surrounding connections,” he added. “This development can’t happen without the consideration of the people and businesses who made up these neighbourhoods.”

Preston Street businesses

With Preston Street forming the western border of LeBreton Flats, the development promises to be a boon for businesses to the south in Little Italy.

“We think it’s going to be very good for our neighbourhood,” said Lori Mellor, executive director of the Preston Street BIA. “It’s the missing link, and we’re hoping that they will bring the grocery stores that are missing and the amenities that our land is too small to enable.”

Ms. Mellor said bars and restaurants on Preston Street will have a “symbiotic relationship” with the new arena and its immediate surroundings during Senators games.

“Ultimately, don’t tell Elgin, but we’ll be the next Red Mile,” she said. “Even those who don’t have tickets to see the actual game, when they make the playoffs, (fans) can come here and be part of the excitement.”

Alex Munro, vice-president for Heart and Crown Irish Pubs, which has a Preston Street location, said the area will provide an alternative destination for consumers.

“I think Preston’s done a nice job of maintaining who and what they are, even though it’s gone through a healthy evolution over the last decade. I think that’ll only get better because of this,” he said. “They’ll be able to identify themselves as being something different than the actual LeBreton project but still within that area.”

He said Bluesfest gives the Heart and Crown a 25 to 30 per cent boost in clientele, and he anticipates a similar impact from Senators games and concerts.

Source: Ottawa Business Journal, Michael Woods, 9 May 2016