The Regional Group's $27 million purchase of Churchill Office Park was a defining transaction in the office market in need of a deal and signalled renewed confidence in Ottawa's suburban office sector following investor pullback.
The negotiation process for Churchill Office Park was prolonged as the vendor's efforts to lease vacant space during the marketing process in early 2023 delayed negotiations. Signing Bird Construction as a tenant mitigated some of the vacancy risk, which helped secure financing and bring buyer-and-seller expectations into alignment. From initial interest to closing, the deal took 16 months.
Thorough due diligence was essential to assess lease terms, financial strength and exposure for the building's 16 private sector tenants, according to the sales team. Unlike federal government tenants, whose return-to-office policies remain uncertain, the Churchill Office private-sector tenants, including BMO, MNP, and Bird Construction, demonstrated resilience and consistent occupancy post-COVID.
Bridging the gap between vendor and purchaser expectations on price was another challenge. However, the building, one of the most-recognized office properties in Ottawa, has long served as a high-quality suburban office asset and is well-positioned due to its proximity to transportation and strong tenant mix.
The deal earned the 2025 CoStar Impact sale/acquisition award in Ottawa, as judged by a panel of real estate professionals familiar with the market.
About the deal: Churchill Office Park Ltd., an affiliate of Manulife, sold the office complex at 1600 Carling Ave. to a locally based real estate firm, Regional Group. Major tenants include BMO, MNP and Bird Construction. The building was 81% occupied, with 35,000 square feet vacant and a weighted average lease term of 4.5 years.
What the judges said: "The sale of 1600 Carling Avenue was a turning point for Ottawa's office market, happening at a time when office properties were struggling to attract buyers and lenders. Regional Group's purchase of this building signalled renewed confidence in suburban office spaces and helped bring momentum back to a sluggish market. There were also challenges such as rising interest rates, tight financing conditions, and a lengthy negotiation process. All of which had to be navigated. But with a strong tenant mix, value-add opportunities, and future redevelopment potential, this transaction reinforced the long-term value of high-quality office assets in Ottawa," said Krishon Walker, Planner II, with economic development services at the city of Ottawa.
"I've always viewed this building as one of Ottawa's iconic office complexes. Its prominent exposure on the Highway, signage opportunities, and the fact that there is remaining development potential make it the most interesting acquisition of the year for me," added Lindsay Hockey, senior vice president and sales representative at Colliers.
"With the volatility of the commercial office market, a commercial office transaction of this size is impactful for the long-term prospects of the Ottawa office market," said Ben Zunder, vice president and sales representative at CDN Global.
They made it happen: Regional Group's team was led by Vice President of Acquisitions Sachin Anand and Vice President of Asset Management and Government Relations Tal Scher.
CBRE's national investment team of Peter Senst, Jaysen Smalley, and Nico Zentil served as the brokers on the deal. The lender was Caisse Desjardins Ontario Credit Union Inc.
CoStar Market Manager Patricia Figueroa contributed to this report.