Transforming the National Capital Region: 4 Strategic Priorities

To: National Capital Region Caucus
From:

• Association Provinciale des Constructeurs d'Habitation du Québec Inc. – Région de l'Outaouais
• Chambre de commerce de Gatineau
• Invest Ottawa
• Ottawa Board of Trade
• Ottawa International Airport Authority
• Ottawa Tourism
• Tourisme Outaouais

Date: August 12th, 2025

 

Context

In July 2025, the Federal National Capital Region Caucus convened key economic development stakeholders from Ottawa–Gatineau to identify a focused set of strategic priorities for the region’s economic growth—priorities that caucus members could champion. Rather than pursuing an exhaustive agenda, the initiative aimed to find common ground among the stakeholders’ diverse portfolios and surface a small number of clear, shared priorities for federal advocacy. The results are outlined below.

Priority 1: Stabilize the Federal Workforce and Real Estate Strategies to Revitalize Ottawa’s and Gatineau’s Downtown Core

Context:

Despite Public Services and Procurement Canada’s Office Portfolio Reduction Plan, which initially targeted a 50% reduction by 2034 (now scaled back to 33%), progress has stalled. The federal hybrid work model has left large swaths of office space underutilized or vacant, undermining local businesses, weakening foot traffic, and delaying economic recovery in both Ottawa and Gatineau. The absence of a clear and coordinated federal strategy on workforce returns and property disposal has created persistent uncertainty for institutional investors. With additional cuts to the public service looming, this strategy is more urgent than ever. Without transparent timelines, criteria, and assurances around redevelopment, capital is exiting our downtown markets and eroding Ottawa-Gatineau’s long-term economic resilience.

Actions:

• Create an Economic Table to Ensure a Strategic Transition of the National Capital’s Economy. Work across departments and with the provinces and municipalities to ensure a thoughtful economic transition for the National Capital Region.

• Conduct and Publicly Release a Surplus Asset Audit. Immediately complete and publish a full inventory of surplus federal office buildings in the National Capital Region, including occupancy status, suitability for disposal, and redevelopment potential.

• Implement a Time-Bound Disposal Strategy for Downtown Assets. Mandate the release of high-potential downtown properties with a clear timeline, prioritizing mixed-use redevelopment with reasonable community benefit requirements and requiring transparent criteria for sale, lease, or transfer.

• Launch a “Reinvent Ottawa-Gatineau” Public Redevelopment Competition. Invite Indigenous, non-profit, private, and academic partners to submit mixed-use, climate-resilient, and culturally inclusive redevelopment proposals for surplus federal sites.

• Make Empty Federal Spaces Available for Cultural or Tourism Events. Enable community and cultural actors to activate vacant federal spaces downtown.

• Offer Tax Incentives and Leasing Subsidies. Provide time-limited tax breaks or leasing subsidies to attract long-term commercial and institutional tenants into retrofitted or repurposed former federal buildings.

Global Precedents:

• Washington, D.C.: Good Neighbor Program transferred surplus federal buildings to local governments and nonprofits; Downtown Recovery Act offered targeted tax relief for tenant reoccupation and retrofit.
• Paris: Réinventer Paris transformed underused state-owned sites via design competitions involving private, non-profit, and civic actors for mixed-use redevelopment aligned with social and economic goals.
• London, UK: The Crown Estate revitalized underused public properties through transparent disposal plans and long-term public-private partnerships, prioritizing sustainability and community benefits to attract investors and catalyze urban regeneration.

Priority 2: Catalyze Transportation for Ottawa-Gatineau

Context:

Ottawa and Gatineau share a highly integrated workforce and economy, with many residents crossing provincial boundaries daily for work, education, and services. Fragmented transit systems weaken regional connectivity and the vitality of the downtown core. Upcoming trade barrier reductions will increase economic integration, creating a need for a seamless, coordinated transit network.

Actions:

• Commit federal funds to develop interprovincial transit infrastructure including Gatineau LRT, new bridge transit corridors, integrated bike-share networks, EV charging hubs, and innovative options such as water taxis or electric ferries.
• Tie federal funding to fare and schedule integration to ensure a seamless, user-friendly regional transit experience reflecting cross-border commuting realities.
• Leverage YOW as a key intermodal hub, integrating VIA Rail, OC Transpo, regional shuttles, and future high-speed rail.
• Recapitalize and expand targeted air service development programs, including funding support for new domestic and international routes, streamlined resources for route launches, and air transport agreement negotiations to unlock new markets for the National Capital Region.
• Support making the Quebec City–Ottawa–Toronto high-speed rail project a reality with a stop in downtown Ottawa.

Priority 3: Make Ottawa-Gatineau a National Defence Innovation Hub

Context:

Meeting NATO’s 5% GDP defence spending target by 2030 is more than a fiscal goal, it’s a nation-building imperative to protect sovereignty, defend the Arctic, modernize the military, and build a resilient, competitive economy. Canada’s Capital Region is ready to lead as a National Defence Innovation Hub uniting government, industry, and academia to deliver sovereign innovation, Arctic readiness, and economic growth. Ottawa–Gatineau must reduce reliance on the public sector and grow high-value, innovation-driven industries. Though Ottawa hosts over 190 and tech firms and Gatineau hosts many tech SMEs plus Telesat’s new campus, the region still lacks an official cluster designation, targeted investment, and infrastructure to fully realize its potential.

Actions:

• Designate the National Capital Region as a National Defence and Innovation Hub by strategically targeting investments to spur the existing defence innovation industrial cluster here while helping meet Canada’s NATO commitments.
• Prioritize federal procurement of certified homegrown defence solutions, with preferences and support for local SMEs to scale firms, protect IP, and attract global investment.
• Expand critical enabling infrastructure such as broadband, NATO DIANA Test Centres, cybersecurity networks, and energy capacity; repatriate defence certification and testing to Canada.
• Invest in the NATO US$1-billion venture capital fund to support domestic access to NATO markets for home-grown dual-use firms.
• Develop sovereign supply chains in semiconductors, optics, and other critical technologies to reduce foreign dependency and safeguard national and economic security, including investing in a commercial III-V Compound Semiconductor Fab located in Ottawa.
• Expand the defence-linked aviation centre of excellence at YOW, leveraging NRC and Transport Canada facilities, industry–academic–government partnerships, and CAF testing.

Global Precedents:

• Northern Virginia: The U.S. federal government deliberately concentrated key defence and intelligence agencies in the region, backed this presence with decades of sustained procurement contracts, and invested heavily in secure digital infrastructure, creating one of the world’s strongest defence clusters.
• Toulouse: The French government anchored the city’s economy in aerospace by directing major national defence and space contracts to local industry, funding R&D through national innovation programs, and building specialized manufacturing and testing facilities, cementing its role as Europe’s premier aerospace hub.
• Tel Aviv: The Government of Israel fostered a cyber-defence powerhouse by integrating military service with advanced technical training, channeling procurement to domestic innovators, and co-investing with industry and academia in secure R&D facilities and data infrastructure.
• Canada: Through the Global Innovation Cluster program, the federal government has demonstrated how targeted national investment, industry co-funding, and innovation infrastructure can accelerate the growth of high-potential sectors, a model that could be applied to building a world-class defence hub.

Priority 4: Create and Invest in a Bicentennial Capital Vision

Context:

Not since the seminal Greber Plan has Ottawa-Gatineau had a comprehensive vision for the National Capital. As a G7 capital, Canada’s seat of government is a powerful national symbol deserving renewed investment and strategic direction. Ottawa’s 200th anniversary presents a rare opportunity to strengthen national bilingual identity, foster civic pride, and build lasting cultural infrastructure across the region.

Actions:

• Allocate one-time federal funding for museum upgrades and cultural infrastructure.
• Position federally-led national celebrations such as Canada Day, Winterlude, and the Illumination of the Alexandra Bridge as flagship cultural exports showcasing national unity and driving visitation and economic activity.
• Develop a federal policy framework to enhance public-private partnerships for delivering tourism experiences in Ottawa–Gatineau, such as modest investments in illuminating key federal buildings that could enable the private operators to leverage it and create tourism experiences that support the nightlife economy.
• Support Indigenous-led tourism and heritage by engaging Indigenous partners in exploring opportunities for a new cultural centre or museum that tells the story of Indigenous peoples in Canada through Indigenous voices and lived experience.
• Coordinate a federal–provincial–municipal “Capital Renewal Fund” focused on beautifying public realm, parks, and ceremonial spaces.
• Fund aviation-themed or airport-located public art and heritage exhibits as part of a broader capital beautification strategy aligned with future YOW expansion.

Global Precedents:

• Canberra: Centenary investments in museums, civic spaces, and performing arts venues set a new cultural baseline.
• Canada: For Canada’s 1967 centennial, the federal government invested heavily in Ottawa–Gatineau’s cultural, civic, and physical infrastructure, funding projects like the National Arts Centre, new museums, major beautification works, and public monuments.
• Sydney: The BridgeClimb leveraged an iconic bridge into a world-renowned attraction and economic driver.
• Canada: The Canada Strong Pass enhanced the visitor experience while promoting national pride and tourism.
• Washington: Modest federal investment in illuminating key architectural landmarks enabled private operators to develop nighttime tours of the capital, fostering national pride and showcasing built heritage with minimal public expenditure.

Conclusion

Underpinning these strategic priorities is the fundamental need for a strong, productive economy that delivers sustained prosperity for the National Capital Region and Canada as a whole.

Achieving this vision demands coordinated investments in talent development, energy infrastructure, and the conditions that attract and deploy private capital at scale. Ottawa– Gatineau must be a place where businesses can start, scale, and succeed; where entrepreneurs and innovators have access to resources, markets, and workforce to compete globally; and where smart public policy unlocks private sector growth.

Strengthening our economic foundations today ensures the National Capital Region remains resilient and competitive, capable of driving sovereign innovation, anchoring a modern defence industrial base, and celebrating our national capital and identity for generations to come.