Canada's Centre Block Valued at $87.9 Million According to Altus Group

TORONTO, ONTARIO--(Marketwire -06/12/12)- The estimated market value of Parliament Hill's Centre Block as an office-building property in downtown Ottawa has increased by 138 per cent over the past 12 years - to a current value of $87,900,000.

In the lead-up to Canada Day, when the value of our national symbols and assets is top-of-mind, Altus Group's Research, Valuation & Advisory (RVA) Practice has estimated the value of the Centre Block. This is the first in a series of "What is This Landmark Worth?" valuations of iconic national, regional and local Canadian landmarks. The series will also highlight key economic trends affecting commercial and residential real estate across the country.

"Considered one of the most iconic heritage buildings in Canada, the Centre Block is clearly a unique building that has value beyond what can be measured through traditional real estate methods," says Colin Johnston, President of Altus Group's RVA practice in Canada. "Our Parliament Buildings, including the Centre Block, are national symbols of government, and a site of architectural beauty and historic significance," explains Johnston. "However, the Centre Block is also an office building and influenced by factors and trends affecting the broader market."

The Centre Block, which includes the Library of Parliament and the Peace Tower, is located at 111 Wellington Street in Ottawa. Occupying a portion of the easterly section of the Parliamentary Precinct (bounded by Wellington Street to the south, Bank Street to the west, the Ottawa River to the north and the Rideau Canal to the east), the buildings and grounds have strong historical associations, an impressive Gothic Revival architectural design and detailing, and status as a national landmark.

The original Centre Block was constructed between 1860 and 1866, with the Library completed in 1876. With the exception of the Library, the building was destroyed by fire in 1916 and reconstructed in 1922. The Peace Tower was added in 1927. The cost to build the original Centre Block was $1,373,633 at 1866 rates; the original budget was $300,000. The cost of building the new Centre Block after the fire was close to $11,000,000, compared to the original budget estimate of $5,000,000.

Centre Block Value Grows By 138 Per Cent Over 12 Years Due to Robust Real Estate Market

Altus Group's research estimated the Centre Block's current market value at $87,900,000, 20 per cent higher than its estimated value in 2007 ($73,100,000), but 138 per cent higher than in 2000 ($36,900,000). Between 2000 and 2007, the value of the Centre Block grew by 98 per cent.

"The Centre Block's increase in value as an office building reflects an increase in rental values in Ottawa, combined with a general improvement in investment market conditions for commercial real estate," says Johnston. "Although the amount of downtown office space in Ottawa has grown 20% over the past decade, demand has outpaced supply, helping to drive up rental rates. Investment demand also informs pricing, and Canada's position as a low-risk and transparent investment environment - in combination with readily available low-cost borrowing - ensures a robust commercial real estate market."

As with All Buildings, Ongoing Investments Required to Ensure Centre Block Holds Its Value

Given current real estate trends, the value of the Centre Block is expected to increase in the next five to ten years, according to Altus Group. However, like other buildings, regular investments are needed to preserve and enhance its value.

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Canada's Centre Block Valued at $87.9 Million According to Altus Group