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ARCHIVED - Treasury Board Open and Fair Real Property Transactions Policy

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1. Effective date

This document contains the policy as revised July 1, 2001. It replaces the version dated February 10, 1998.

2. Policy objective

To ensure that real property transactions are, and are seen to be, conducted with openness and fairness.

Note: For interpretation of this policy in the Province of Quebec, "real property" means "immovable" within the meaning of civil law of the Province of Quebec and includes the rights of a lessee in respect of such an immovable.

3. Policy statement

It is government policy that departments acquire and dispose of, and are seen to acquire and dispose of, real property in a fair and open manner that recognizes the need for the public to be given a reasonable opportunity to acquire property from, and dispose of property to, the government.

4. Application

This policy applies to all departments within the meaning of section 2 of the Financial Administration Act unless specific acts or regulations override it.

5. Policy requirements

(a) Departments must provide the public with a fair and equitable opportunity to acquire real property from, and to dispose of it to, the government by soliciting offers except where, taking into account program requirements, it is the minister's opinion that one of the following conditions applies:

  • there is a pressing emergency in which delay would be injurious to the public interest; or
  • the nature or the subject matter of the acquisition or disposition is such that it would be inappropriate or would not be in the public interest to have a solicitation of offers.


Examples of transactions that could fall under the second category appear in Appendix A. In all cases, the full circumstances and data used to substantiate the decision to make an exception must be documented in the relevant files.

(b) In soliciting offers, departments must give a reasonable and representative number of persons or firms an opportunity to make offers by using one of the methods in Appendix B.

(c) Departmental decisions on selecting offers must be financially prudent and comply with the points below.

A department shall

  • when acquiring real property, accept the lowest offer or, in circumstances that in the opinion of the minister warrant, accept the offer representing the best value; or
  • when disposing of real property, accept the highest offer or, in circumstances that in the opinion of the minister warrant, accept the offer representing the best value.

The criteria for determining best value must be identified before entering into the acquisition or disposition. These criteria may be based on the best balance of benefits to a department's programs.

(d) When acquiring or disposing of real property, departments must determine that the total consideration payable or receivable by the government is justified in relation to the market value of the real property being acquired or disposed of. Departments must use current appraisals or estimates as set out in Appendix C to assist in this determination.

6. Responsibilities

The Treasury Board of Canada Secretariat is responsible for advising the Treasury Board on establishing policy on real property and monitoring practices to acquire and dispose of real property.

7. Monitoring

The Secretariat will determine how effective this policy is, find out how it is applied in departments, and decide whether it needs to be revised. It will do this through ongoing contact with departments, consulting with the Treasury Board Advisory Committee on Real Property, and noting audits and reviews conducted by departments or the Auditor General of Canada. The Treasury Board Guide to Monitoring Real Property Managementprovides information so that departments can monitor and assess policy implementation.

8. References

8.1 Authority

This policy is issued pursuant to the Financial Administration Act, subsections 7(1), 9(1.1), and 9(2), and the Federal Real Property and Federal Immovables Act, subsection 16(4).

8.2 Treasury Board publications

Treasury Board Guide to Monitoring Real Property Management

Treasury Board Real Property Glossary

9. Enquiries

Please direct enquiries about this policy to your departmental headquarters. For interpretation of this policy, departmental headquarters should contact:

Real Property and Materiel Policy Directorate
Treasury Board of Canada Secretariat
140 O'Connor Street
Ottawa ON K1A 0G5
Telephone: (613) 941-7173
Facsimile: (613) 957-2405


Appendix A - Transactions Generally Excepted

Policy requirement (a) sets out two exceptions to the solicitation rule. The following are examples of transactions that could be included in the second category:

(a) A purchase, lease, licence, or other acquisition in which the property to be acquired can only reasonably be acquired from one source, such as

  • the acquisition by the Crown of an easement;
  • the acceptance of a surrender of a lease of federal lands;
  • the acceptance of the relinquishment of a licence in respect of federal real property;
  • a real property exchange involving particular properties; or
  • a lease by the Minister responsible for the Royal Canadian Mounted Police with a province or municipality for the purpose of providing policing services.

(b) A sale, lease, licence, or other disposition in which the property can only reasonably be disposed of to one person, such as

  • the issuance of an easement on federal lands;
  • a surrender of a lease by the Crown;
  • the relinquishment of a licence held by the Crown; or
  • a real property exchange involving particular properties.

(c) The acquisition of an option to purchase real property.


Unless otherwise excepted, the exercise of an option requires a solicitation of offers.

(d) A transfer of administration between two departments or between a department and an agent corporation.

(e) A transfer of administration and control to a province, or a sale to a municipality, where the property is to be used for public purposes.

(f) A sale of property to the Canada Lands Company CLC Limited.

In addition, there will be transactions that will have characteristics that might also make the solicitation of offers inappropriate or otherwise not in the public interest. One example would be a new lease for presently occupied real property, where an options analysis indicates the total cost of continued occupancy to be clearly less costly than the total estimated cost of new occupancy, based on complete and reliable market data, than would be expected to result from a solicitation of offers. However, this options analysis must be done early enough so a solicitation of offers for the needed property will not be precluded if the options analysis is inconclusive.

Appendix B - Methods of Soliciting Offers

  1. Public advertising, including an open bidding system.
  2. Giving public notice that is consistent with generally accepted trade practices.
  3. Selection from an open source list (i.e. a document that lists representative suppliers of the real property required).
  4. For acquisitions by purchase, selection from a representative list of available properties accompanied by an options analysis that demonstrates a fair comparison of the properties on the list.
  5. Use of a system that, in the minister's opinion, given the subject and nature of the acquisition or disposition:
  • provides a reasonable likelihood that potentially interested persons or firms will become aware of the proposed acquisition or disposition; and
  • promotes a fair and equitable consideration of offers.

Appendix C - Appraisals and Estimates


Definitions of "appraisal" and "estimate" appear in the Treasury Board Real Property Glossary.

Appraisal services must be obtained in accordance with the requirements of Appendix E of the Treasury Board Common Services Policy.

  1. Before acquiring or disposing of real property, other than through a lease, licence, transfer of administration, or sale to the Canada Lands Company CLC Limited, a department must obtain
  • at least one estimate when, in the opinion of the accountable custodian, the market value of the real property is not greater than $250,000;
  • at least one appraisal when, in the opinion of the accountable custodian, the market value of the real property is greater than $250,000 and less than $1 million; or
  • at least two appraisals when, in the opinion of the accountable custodian, the market value of the real property is equal to or greater than $1 million, with at least one of the appraisals being obtained from a qualified appraiser (or the equivalent for real property outside Canada) who is not a person employed in the Public Service.
  1. Before acquiring or disposing of real property by a lease or licence, a department must obtain at least one estimate.
  2. Before any transfer of administration of real property between two departments or between a department and an agent Crown corporation, an estimate mutually agreed to either by both departments or by the department and the corporation, must be obtained.
  3. Before the sale of a selected surplus property to the Canada Lands CompanyCLC Limited, a department must obtain from a qualified independent appraiser
  • one appraisal for a single property
  • a portfolio valuation using bulk and mass appraisal techniques for a portfolio of properties

The terms of reference for the appraisal or portfolio valuation will be developed by the custodial department in consultation with the Canada Lands CompanyCLC Limited.