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ARCHIVED - Treasury Board Real Property Investment Policy

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1. Effective date

This document contains the policy as revised May 31, 1998. It replaces the version dated November 15, 1993.

2. Policy objective

To ensure that custodian departments make sound real property investments.

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 the policy of the government that custodian departments acquire, maintain, preserve, and dispose of real property to the maximum long-term economic advantage of the government while satisfying their real property needs.

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) Custodian departments must systematically assess the condition of the real property in their inventory and use this information to determine when and how to maintain, preserve, and renew its value and usefulness or replace the real property, consistent with their program needs.

(b) Within available resources, custodian departments must plan to make balanced investments that meet program needs while fulfilling other federal policy requirements. Departments are encouraged to examine their real property inventory in its entirety and then develop long-term strategies for it similar to the way one would go about managing a portfolio.

(c) Custodian departments must fully analyze proposed real property investments made in support of program requirements. This analysis shall take into account the following:

(i) the expected duration and changing needs of the program, including the effects of information technology and security considerations on service-delivery and program needs;

(ii) trade-offs between different investment options, such as capital versus operations and maintenance;

(iii) opportunity costs and the value of money over time;

(iv) costs associated with the location of the real property;

(v) disinvestment or disposal opportunities;

(vi) the highest and best use of the property; and

(vii) the maximum program use.

(d) Custodian departments must base real property investment decisions on the full life-cycle costs of the property involved. These include acquisition costs, operation, ,maintenance, grants in lieu of taxes, renovation, restoration, other costs related to the real property accountability framework (e.g. heritage protection, accessibility standards, preservation of the environment), and the direct and indirect costs of disposing of the property (e.g. realty fees, surveys, and decontamination).

(e) Custodian departments shall ensure that

(i) priority is given to maintaining and preserving long-term assets and reducing operating expenses unless these are inconsistent with program priorities or not in the best economic interests of the Crown;

(ii) acquisition decisions, including those for any new facilities, are based on an economic and program assessment that considers least-cost, best-value alternatives for delivering the requirement (e.g. Crown construction, leasing, and lease-purchase) and flexibility of both ownership and use (e.g. ability to sell, length of lease term, and office space in open landscaping); and

(iii) disposition decisions are based on an economic and program analysis that fully considers the costs and benefits of disposal.

(f) Departments leasing real property (i.e. Her Majesty as tenant) shall limit the terms of such leases to the shortest reasonable period supported by program needs.


Custodian departments must plan for their long-term real property needs in a way that is consistent with the Treasury Board Capital Projects Approval Policy and the Treasury Board Long-term Capital Plans Policy. The former is concerned with total project costs, including both capital projects and projects involving leases, lease-purchases, and other modes of financing real property.

6. Responsibilities

The Treasury Board of Canada Secretariat (TBS) is responsible for establishing policy for investment planning, communicating government-wide objectives to departments, encouraging departments to use good real property investment practices, and coordinating and monitoring those practices when appropriate. TBS also provides advice to the Treasury Board on individual projects as well as on the long-term capital plans of departments.

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
L'Esplanade Laurier
140 O'Connor Street
Ottawa ON K1A 0G5
Telephone: (613) 941-7173
Facsimile: (613) 957-2405