Thank you, Madam Speaker. I’d like to recognize a former Member for Mackenzie Delta, David Krutko. Welcome.

Thank you, Mr. Blake. I’d like to welcome those that are visiting in our gallery today and thank you for partaking in the observation of our proceedings here today. Thank you.

Item 6, acknowledgements. Item 7, oral questions. The Member for Range Lake, Mr. Dolynny.

Thank you, Madam Speaker. Earlier today in my Member’s statement I talked about Yellowknife office market status this year as we prepare the RFP of our newly constructed GNWT building in downtown Yellowknife. My questions are for the Minister of Public Works and Services. Has the department factored in with the addition of the 60,000 square feet pushing our limit

to 140,000 square feet of office space and pushing our vacancy rate to 10.7, has the department done some calculations what that potentially could do to the market for Yellowknife?

Thank you, Mr. Dolynny. The honourable Minister responsible for Public Works and Services, Mr. Glen Abernethy.

Thank you, Madam Speaker. In the last Assembly the government did a comprehensive general purpose office space review and that review took into consideration all current and future space. The numbers that we have are a little bit different than the numbers that Mr. Dolynny is suggesting and I would be really interested to see where he got his numbers. For Class A and B property, which is what the government would be renting, we show 70,000 square metres here in Yellowknife and with the addition of the new Gallery Building we see an additional 5,000 square metres. This, based on our analysis, will only take it to between 5 and 7 percent, which by any account is a healthy market. By the time our building is constructed – and the RFP has gone out, it has been awarded and construction will begin this September – that building will, if normal trends show to be true, be full and we’ll still be back down at the 0.1 or 0.2 or 1.6 or zero percent vacancy here in Yellowknife. We don’t see a significant impact on the Yellowknife market.

I don’t disagree that we’re talking potentially in metres and square feet, the fact remains that these numbers are coming right from the buildings property managers themselves and, as such, I would recommend that we should get those numbers in order and make sure that we are talking apples to apples.

That said, my calculations come up with a 140,000 square foot estimate, which on absorption rate that we’ve been using in Yellowknife here over the past number of years is about 10,000 square feet per year, thus putting us about a 14-year potential shelf life of office space available. Has the department factored in this shelf life and what this could potentially do to the markets given that number?

I’m going to be talking square metres because that’s the information I have in front of me. The absorption rate in Yellowknife has been about 2,000 square metres annually. If you factor in the new buildings that have come in over time, such as the Greenstone and the new office building, everybody has said we’re going to have a big problem in Yellowknife with too much space. Almost immediately, within a year, year and a half, two years, both those buildings have been completely filled.

The analysis that was done shows that this is the trend in Yellowknife and that we can handle more office space in Yellowknife. There are some

problems. With this zero percent vacancy rate to 1.6 percent vacancy rate that has existed here in Yellowknife, the costs have been incredibly high. As a result, in the last five years alone the cost of our leases has gone up 40 percent. That’s because the market is unhealthy. A healthy market is between 5 and 7 percent. That’s what we’re going for.

I’m not denying that the Minister is fairly accurate in his numbers. Five to seven percent is a healthy market for economy for commercial. We are, by virtue of calculations, pushing that number to over 10 to 11 percent, according to our calculations. Square metres, square feet, we have to get the right numbers out there. The studies that the Minister is indicating are studies that were done probably in 2009.

Will the Minister commit to maybe updating these numbers so that the commercial real estate market here in Yellowknife can be updated appropriately?

We’re absolutely confident in the numbers that we have. The study was done in 2009 but it did actually take into account the addition of the new buildings such as the Gallery Building. All those buildings were taken into consideration.

We’ve looked at the numbers again. We’ve looked at the Class A and B buildings, the ones that we actually utilize, and we’re confident that the rates will stay the same.

There are a lot of good things about this building. One of the things about this building is that over the lifecycle of this building it is going to save the Government of the Northwest Territories, and by default the people of the Northwest Territories, $100 million which can go to programs and services throughout the Northwest Territories. On top of that we’ll be able to have a bit better control over our leases which have grown by 40 percent in this tight market.

We’ve done the numbers, we’ve shared it with all the Members, it’s out there. Happy to share it again, happy to share with anybody that wants to see it. We’re confident in our numbers today.

Thank you, Mr. Abernethy. Final, short supplementary, Mr. Dolynny.

Thank you, Madam Speaker. Whenever this question is brought out, the Minister of the day will talk about the great benefits and I’m not denying them. Brand new building, it is great. We’re going to see some efficiencies in heat and power and everything else. We have to remind ourselves here that we’re putting a disruption, a market slump disruption in the commercial real estate market by virtue of us building our own building.

Will the Minister commit to overlooking, seeing, and updating the numbers so that we are indeed

dealing with proper square feet or square metres as the case may be?

There’s not much point. It’s already been done. The numbers are consistent. It takes into consideration the addition of all Class A and Class B buildings since the report was done. They’re built in there. We’re confident. The contract has been awarded. The building is being built as we speak. The ground will break in September. We’re making next steps. At the end of the day this building is going to save the people of the Northwest Territories significant money, money that we can once again roll into the program. Given the history of buildings in Yellowknife it’s not going to have a significant market impact. That analysis has been done.

People, as I’ve said, have talked about buildings coming to Yellowknife, fear of significant market disruption, like the Greenstone Building or the new office building across from Fiddles & Sticks. Shortly after those buildings were put up, and people complained or worried about the market disruption, both those buildings were filled and we were back down at zero percent vacancy. The Member refers to a 10 percent vacancy.

I have to say that 10 percent vacancy would only exist if both the new Gallery Building and our building were to magically appear on the ground at the same time. That’s not going to happen. Our building is three years away and the Gallery Building will be full long before then.

Thank you, Mr. Abernethy. That exchange took seven minutes. If there’s 10 Regular Members who have questions, that’s 70 minutes. We only have a 60-minute question period. Let’s keep that in mind. The honourable Member for Frame Lake, Ms. Bisaro.

Thank you, Madam Speaker. I’ll try to keep my comments down to a dull roar. I’d like to follow up on my Member’s statement and my questions are directed to the Minister of Justice with regard to the Residential Tenancies Act.

The issue of the lack of jurisdiction of the rental officer over transition housing was raised in the Report of the Rental Officer, 2010-2011, which was tabled last December. I’d like to know, there are a number of issues in there, I can’t remember the number – four, five, or six, I believe – that the rental officer raised as issues that needed to be dealt with by the department and in the Residential Tenancies Act. I’d like to know from the Minister what actions he and the department are taking in regard to the recommendation on transition housing and the other recommendations in the report.

Thank you, Ms. Bisaro. The honourable Minister responsible for Justice, Mr. Abernethy.

Thank you, Madam Speaker. I’ll try to be a little quicker on this one. I’ve already answered this question last week when we talked about other changes that the Members were looking for in the Residential Tenancies Act.

Six recommendations were put forward by the rental officer. We’ve committed to doing an analysis of those recommendations as well as the recommendations to find a hammer, if you will. We will review those. We are going to bring those back to committee in the fall, an opportunity to have a discussion and set some direction on how we want to move forward.

The Member is right; one of the areas that the rental officer wants us to look at is the application of the Residential Tenancies Act on transitional housing. I do have to remind Members and everybody else that there’s always two sides to every opinion and one of the most significant landlords of transitional housing here in the Northwest Territories has discussed this in the past, and at that time they actually recommended not to go forward with this particular provision as it would actually complicate their service providing in their institution. There are both sides to every story. We are going to do the review. We are going to bring it to Members for some decisions.

Thanks to the Minister for his response. I appreciate that we are going to get some data, some investigation, some evaluation of the current situation and that something is going to come back in the fall. I look forward to that.

I guess I would like to know, then, and interestingly I’m not so sure that the Minister and I are talking to the same people involved in transition housing because there’s differing views obviously. I’d like to know from the Minister, if we’re not going to have a report until the fall sometime, Lord knows legislative amendments would be a long time after that, so I want to know if the department is able to do anything, if they are looking to take any action to address the issues in the rental officer’s report in the interim while they do the investigation.

As I’ve indicated, there are a significant number of alternate opinions on this one, so before we implement something, we do have to take it through the public process. We do have to take it through my colleagues on that side of the House to make sure that everybody’s informed and that we make an informed decision. Once that’s done, whether it’s legislation or policy or procedure, we will do as the House directs. Thank you.

I’ll try my question again. I appreciate that we have to do investigation before

we make a strong recommendation. There needs to be some analysis done and there needs to be some consultation done. What I’m asking the Minister is: Prior to that report from the department and the Minister coming forward, can the Minister advise if there is anything that the rental officer can do in the interim to try and address the issues that he has raised? I’m thinking, perhaps, of mediation or dispute resolution, et cetera. Thank you.

I’ll direct the staff at the department to talk to the rental officer to see if he has any suggestions. Thank you.

Thank you, Minister Abernethy. Final, short supplementary, Ms. Bisaro.

Thank you, Madam Speaker. I will be short. I’d like to know from the Minister if it is his intention to bring forward amendments to the Residential Tenancies Act within this 17th Assembly, if that’s what’s recommended. Thank you.

Once the research is done and we take it to committee to have a discussion, if that is the wish of committee, I would be happy to take it forward. Thank you.

Thank you, Minister Abernethy. The Member for Hay River North, Mr. Bouchard.