Ottawa commercial cap rates in 2026 reflect a market with a structural driver that Toronto and Kitchener-Waterloo do not share: the federal government as the dominant office tenant, employer, and asset owner. CBRE Q4 2025 puts Ottawa Downtown Class AA office at 6.25-6.50%, Class A at 6.75-7.75%, and Class B at 7.50-8.50%. Ottawa office availability rose 170 bps year-over-year to 14.2% in Q1 2026 per Altus - the only major Canadian office market that moved against the national trend of tightening availability (Altus Q1 2026 office market update, April 22, 2026). The macro frame is a Bank of Canada overnight rate held at 2.25% through four consecutive decisions.
Key Takeaways
- CBRE Q4 2025: Ottawa Downtown Class AA office 6.25-6.50%, Class A 6.75-7.75%, Class B 7.50-8.50%.
- Ottawa office availability was 14.2% in Q1 2026 per Altus - up 170 bps YoY, against a national trend of office availability tightening 140 bps YoY to 15.4%.
- The Bank of Canada held the overnight rate at 2.25% on April 29, 2026 - the fourth consecutive hold - anchoring the 317 bps Q1 2026 spread between cap rates and the 10-year Government of Canada bond.
- Altus suburban multiple-unit residential moved up to 4.66% in Q4 2025 with Ottawa and Halifax driving the increase - a useful Ottawa-specific multifamily signal in a series otherwise tightening.
Headline Ottawa cap rates - CBRE Q4 2025 by asset class
The CBRE Q4 2025 Canadian Cap Rate Report PDF is the most granular public source for Ottawa cap rates by asset class. All ranges in the table below are sourced from the CBRE Q4 2025 Canadian Cap Rate Report (verified 2026-05-21).
| Asset class | Ottawa Q4 2025 (CBRE) | National benchmark |
|---|---|---|
| Downtown Office Class AA | 6.25 - 6.50% | 6.88% (CBRE) / 6.59% (Altus) |
| Downtown Office Class A | 6.75 - 7.75% | - |
| Downtown Office Class B | 7.50 - 8.50% | - |
| Suburban Office Class A | 7.50 - 8.50% per CBRE Q4 2025 (verified 2026-05-21) | - |
| Industrial Class A | 5.50 - 6.00% per CBRE Q4 2025 (verified 2026-05-21) | 5.91% (CBRE national) |
| Industrial Class B | 6.25 - 6.75% per CBRE Q4 2025 (verified 2026-05-21) | 6.42% (CBRE national) |
| Multifamily High Rise A | 4.50 - 5.00% per CBRE Q4 2025 (verified 2026-05-21) | 4.44% (CBRE national) |
| Retail Strip (anchored) | 6.25 - 6.75% per CBRE Q4 2025 (verified 2026-05-21) | - |
Sources: CBRE Q4 2025 Canadian Cap Rate Report PDF (Ottawa page); Altus Group Q4 2025 Canadian CRE Investment Trends Survey for the Downtown Class AA Altus benchmark.
The Ottawa AA range (6.25-6.50%) is a tight 25 bps span; the Class B range (7.50-8.50%) is 100 bps wide and reflects the federal-tenant overhang.
What Ottawa shares with the Toronto and national picture
The Bank of Canada hold at 2.25%. The Bank of Canada held the overnight rate at 2.25% on April 29, 2026 - the fourth consecutive hold - after a cumulative 100 bps of 2025 cuts. The 10-year GoC was flat QoQ in Q1 2026; the spread between the all-properties cap rate and the bond tightened to 317 bps (CBRE Q1 2026).
The 2021 refinance wall. Ottawa assets acquired at sub-4% pricing are resetting against 2026 spreads. The bid-ask gap Altus flagged (2025 total Canadian CRE volume ~$51 billion, -8% YoY) is present in Ottawa as everywhere. See our Canadian CRE refinance cycle 2026 analysis.
Flight-to-quality. Bifurcation toward Trophy and AA, away from Class B, explains the Ottawa AA range holding at 6.25-6.50% while Class B widens to 7.50-8.50% - the same pattern that drove GTA office cap rate compression of 25 bps QoQ in Downtown Class AA in Q4 2025.
Where Ottawa diverges - federal employer, return-to-work, submarkets
The federal government concentration. Ottawa's office market is anchored by the Government of Canada as tenant, employer, and asset owner. Public Services and Procurement Canada (PSPC) manages a federal portfolio whose disposal-plan adjustments and lease decisions move Ottawa office availability in a way no private-sector tenant could. Altus attributes the 170 bps YoY availability increase directly to shadow vacancies and PSPC disposal-plan adjustments - a driver essentially unique to Ottawa.
Post-2024 return-to-work policy. The federal return-to-work mandate phased in through 2024-2025 reset demand for Ottawa Class A and B. Departments that consolidated footprints or released portions of older Class B buildings drove the shadow-vacancy increase. PSPC manages approximately 5.9 million square metres of office space nationally, of which over 50% is in the National Capital Region per the 2024 Auditor General report on federal office space (verified 2026-05-21); the national portfolio shrank from 6.0M to 5.9M rentable sq m between 2019-20 and 2023-24 (a 100,000 sq m national reduction — the AG report does not publish an NCR-specific reduction figure). The GC-OPRP targets a 50% reduction by 2034, now tracking at approximately 33%; as of April 2026, PSPC is actively reviewing whether the four-day return-to-office mandate will require additional space rather than further reductions.
Centretown, Sandy Hill, Kanata. Centretown and the Sparks/Slater Street core carry the federal-tenant overhang most heavily. Sandy Hill faces a different demand pattern grounded in mixed-use redevelopment and student-housing-adjacent multifamily. Kanata is a tech and aerospace cluster whose office demand is private-sector, not federal - and behaves more like a private-anchor suburban market. A CUSPAP 2026-compliant Ottawa appraisal must name the submarket and disclose the federal-tenant exposure of the comp set.
Industrial - East Ottawa and the Hawkesbury corridor
East Ottawa industrial parks and the Hawkesbury corridor along Highway 417 toward the Quebec border carry the primary modern industrial supply for the National Capital Region. Ottawa Industrial Class A was 5.50%–6.00% and Class B was 6.25%–6.75% in Q4 2025 per CBRE Q4 2025 (verified 2026-05-21). National benchmark: CBRE Q4 2025 Industrial A 5.91%, B 6.42%; Altus Q1 2026 national industrial availability 6.2% (+40 bps YoY) (Altus Q1 2026 industrial update). Ottawa industrial does not roll up into Southwestern Ontario in the Altus series. See Ontario industrial cap rate trends.
What this means for a 2026 Ottawa commercial valuation
- Name the federal-tenant exposure. A Class B downtown Ottawa building with a federal tenant on a multi-year lease prices differently than the same building with a private tenant, and differently again than one with vacant federal space and shadow-vacancy overhang. The CUSPAP 2026 narrative must identify whether the subject and the comps are federal-anchored.
- Read availability and cap rate together. Ottawa availability moving 170 bps YoY against a national tightening trend signals demand-side change. The 7.50-8.50% Class B range encodes the return-to-work overhang. Practitioners citing the wide end should also cite the 14.2% availability figure.
- Defend the terminal cap rate against a federal-policy view. The terminal in an Ottawa DCF must reflect a defensible view of where PSPC disposals and AA-versus-B bifurcation sit at exit. CUSPAP 2026 asks the appraiser to defend going-in and terminal independently. For the canonical definition, see cap rate.
Frequently asked questions
What are Ottawa commercial cap rates in 2026?
CBRE Q4 2025: Ottawa Downtown Class AA office 6.25-6.50%, Class A 6.75-7.75%, Class B 7.50-8.50%. The Canadian national all-properties average was 6.61% in Q1 2026 per CBRE.
Why is Ottawa office availability rising when other Canadian markets are tightening?
The federal government. Altus Q1 2026 attributes Ottawa's 170 bps YoY availability increase to shadow vacancies and PSPC disposal-plan adjustments - a dynamic specific to the National Capital Region. Toronto availability moved the other way, down 270 bps YoY to 15.5%.
How does Ottawa office compare to Toronto and Kitchener-Waterloo?
Ottawa Downtown Class AA at 6.25-6.50% sits wider than Toronto's tight end (5.25%) and narrower than Toronto's wide end (7.75%). Kitchener-Waterloo has no Downtown Class AA series - KW is a Class A market with no AA. Ottawa Class B at 7.50-8.50% is the widest of the three Ontario downtown office prints.
Further reading
- Ontario commercial cap rates 2026 - the cluster pillar; the full Ontario picture by asset class and geography.
- GTA office cap rate compression - the Toronto-side flight-to-quality narrative the Ottawa AA print sits inside.
- Canadian CRE refinance cycle 2026 - the 2021 five-year wall and lender underwriting context.
- Ontario industrial cap rate trends - the cross-Ontario industrial picture.
- cap rate - the canonical NOI / Value definition and going-in versus terminal distinction.
Commission an Ottawa commercial appraisal. If you need a CUSPAP 2026-compliant commercial appraisal grounded in current Ottawa evidence and signed by an AACI-designated practitioner, request an appraisal. We serve the National Capital Region from our Ontario-wide AACI commercial appraisal practice, founded in 1973.
Update log: 2026-05-15 - Initial publication. Ottawa Downtown Office AA / A / B verified against CBRE Q4 2025 Canadian Cap Rate Report PDF. Macro figures verified against CBRE Q1 2026, Altus Q1 2026 office and industrial updates, Altus Q4 2025 ITS, and the Bank of Canada April 29, 2026 rate decision. 2026-05-21 - Ottawa Suburban Office A, Industrial A/B, Multifamily HR A, and Retail Strip rows populated from CBRE Q4 2025 Canadian Cap Rate Report PDF. PSPC portfolio square footage and NCR reduction data added from the 2024 Auditor General report on federal office space. 2026-05-21 (citation QA) - Corrected PSPC portfolio figure from 6.1M to 5.9M (the AG report's stated figure); clarified that the 100,000 sq m is the national portfolio reduction, not an NCR-specific figure, which the AG report does not publish separately.
