24 Sussex Drive rehabilitation cost estimates “requires interpretation”: HODI

Historic Ottawa Development Inc. (HODI) is currently undertaking a review of reports pertaining to 24 Sussex Drive – obtained through ATIP requests submitted to the National Capital Commission (NCC) and Privy Council Office (PCO) – which indicates that media reporting of the $37 million cost estimate for “deferred maintenance” work on the Main Residence building is misleading.

The $37 million figure arises from the “NCC 2021 Official Residences of Canada Asset Portfolio Condition Report,” wherein the “deferred maintenance” costs are estimated at $36.64 million. That estimate requires interpretation.

The figure was based upon a 2017 report by Turner and Townsend, “Cost Assurance and Benchmarking Exercise – 24 Sussex Drive” which analyzed third-party cost estimates completed in 2009 (then reported to be $10 million ) – using a functional programming approach that compared estimates to costs for other official residences around the globe.

While the Turner and Townsend report found that the estimates were “reasonable and based on a sound and best practice approach to developing cost estimates,” they also highlighted contingencies of 20 per cent, escalations, and cost allowances for significant renovations within the Main Residence that are not yet scoped or designed. The cost estimate also contained approximately 4,000 sq. ft. of new building space on-site, and renovations to the existing pool building.

The report includes the disclaimer, “We are unable to comment on the $/sf allowance for interior repurposing and future space addition in the absence of identified scope for these items.”

HODI is concerned with the negative public opinion bias regarding the future of 24 Sussex Drive created by misinterpretation of the $37 million cost estimate in media reports – which create the erroneous impression that the Main Residence requires $37 million of repairs and rodent extermination – and is releasing this statement to clarify the origins of that figure (the 2009 cost estimate of $10 million).

Located on one of the National Capital’s busiest tourist routes, 24 Sussex Drive is a national heritage treasure, and is designated “Classified” by the Federal Heritage Buildings Review Office (FHBRO).

Under the Official Residences Act, it is a statutory obligation of government to fully fund maintenance at 4 per cent of replacement value ($40 million) annually, in accordance with the “Government of Canada’s Guide to the Management of Real Property.”

The 2022 NCC report “Revitalizing the Residence of the Prime Minister of Canada” recommended “recapitalization and redesign of the existing building at 24 Sussex Drive.”

Marc Denhez is president of Historic Ottawa Development Inc.