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2006 May Status Report of the Auditor General of Canada

May 2006 Status Report—Chapter 7

Exhibit 7.5—Selection of accommodation options results in additional costs

Centennial Towers, Ottawa, Ontario

Centennial Towers was built in 1965. The federal government has been its primary tenant for all but five of the subsequent years. Beginning in 1983, Public Works and Government Services Canada (PWGSC) entered into a series of 10-year leases. The current lease runs from 2003 through 2013. In its most recent lease renewal, the Department's analysis indicated that the present value of the cost of accommodation was $261 million, or $81 million more than the most cost-effective alternative that it had identified in 2001 (Crown-purchase option). The departmental calculations were based on a 25-year time horizon.

Jean Edmonds Towers, Ottawa, Ontario

Jean Edmonds Towers was constructed in 1974. Since then, PWGSC has entered into a series of leases. The federal government has been the sole tenant and is committed to leasing the space through 2015. In its most recent lease renewal, the present value of the cost of accommodation was $158 million, or $12.5 million greater than the least-cost option identified in the financial analysis. The Department's calculations were based on a 10-year time horizon.