2 more Ottawa office buildings being converted into residential spaces, report says

265 Carling Avenue. Oct. 1, 2025. (Peter Szperling/CTV News Ottawa)

Two more office buildings are being converted into residential buildings in Ottawa, according to a new report.

CBRE says two new office-to-residential conversion projects have removed office space from the active inventory, with the projects at 77 Metcalfe Street and 265 Carling Avenue.

“This raises Ottawa’s total count of such projects since the pandemic to 14 and showcases how landlords are adapting to the shifting office landscape,” CBRE said.

The former NAV Canada building on Metcalfe Street is being demolished and redeveloped by Groupe Mach into 234 rental apartments, according to CBRE.

In the west end, KTS Properties is converting 265 Carling Avenue into a 70-unit building via a phased approach, according to CBRE.

“Cumulatively, these two buildings represent 190,000 sq. ft. of office space being removed from the inventory,” the report said.

Other buildings being converted from office to residential space includes the former Department of National Defence building at 110 O’Connor Street, 200 Elgin Street, 360 Laurier Avenue and 130 Slater Street.

CBRE released its Q3 2025 Canada Office figures Wednesday morning, showing Ottawa’s office vacancy rate increased to 12.8 per cent in the July-September period, up from 12.5 per cent in the spring.

The report says the uptick in the overall vacancy, equating to 204,000 sq. ft. of negative net absorption, was driven by “shadow vacancies” coming to market, including on Richmond Road and on Legget Drive.

The CBRE report said with the Ontario government and the City of Ottawa soon requiring employees in the office full-time, there is “renewed optimism that this may induce the federal government to return full-time and translate into positive leasing momentum.