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Ottawa's old train station is now the temporary home of the Senate of Canada while Centre Block undergoes renovations.Sean Kilpatrick/The Canadian Press

Few would argue that government employees make up the biggest work force in Ottawa. However, the new and thriving tech industry – along with a thriving startup ecosystem – is quickly becoming a close second. Combine these fast-paced business models with the influx of hip new restaurants and cafés, and the demand for commercial space in Ottawa has turned the nation’s capital into a hotbed for heritage building renovation.

“There is a lot more buy-in from the private sector in rehabilitating heritage properties. It’s a great trend to see,” says Leslie Maitland, consultant and former president of Heritage Ottawa.

Ms. Maitland, who worked for the organization for more than a decade, says in the past few years Ottawa has seen more and more restaurant and business owners rent out heritage buildings through the downtown core only to transform them into modern, hip spaces.

She points to Toronto’s Distillery District and Vancouver’s Granville Island developments as her “favourite” examples of how the rehabilitation of heritage buildings can turn a downtrodden area into a thriving neighbourhood. These are Canadian examples of what businesses can do with older character buildings.

The Distillery was essentially an abandoned industrial area 20 years ago, she says, and now the neighbourhood – roughly 15 minutes east of the CN Tower – is a hub of development and growth.

A recent economic impact study prepared by Waterfront Toronto showed the investment in the area produced $3.2-billion in total economic output to the Canadian economy. Granville Island, meanwhile, now employs more than 2,500 people and sees more than 10 million visitors each year, according to a recent study produced by the Emily Carr University of Art and Design.

“A project like that attracts growth around it,” she explains. “Heritage restoration can be a significant driver for neighbourhood rehabilitation.”

Updating Canada’s capital

In Ottawa, the federal government has recently undertaken a $219-million restoration of the old train station to turn it into the temporary home for the Senate of Canada while Parliament Hill’s Centre Block undergoes a decade-long renovation.

The train station underwent a $219-million restoration.Sean Kilpatrick/The Canadian Press

The Fairmont Château Laurier, connected to the Senate, is also getting a $100-million facelift as part of an investment into an area of the city that’s been a bit neglected over the past few decades.

“This was an area where time just stopped,” says Senator Scott Tannas, the chair of the Senate subcommittee on its long-term vision and plan, the body overseeing the relocation process. “These recent investments will help rejuvenate and keep the commercial growth momentum in the area.”

While businesses are keen to lease a heritage building in the city, there’s a shortage of older buildings to repurpose, says Giorgio DiNardo, a senior sales representative at Colliers International Group Inc.

The government owns most of the downtown buildings, so they will continue to invest in the ones they already own, he says. That makes it harder for entrepreneurs and private companies to find older buildings to repurpose.

Even if a company is able to find and secure a heritage building to convert, they face significant costs. Some of the older buildings need their entire roof and mechanical systems replaced, Mr. DiNardo says, and that’s expensive.

Then there is the city’s commercial-vacancy rate. In the downtown core, that rate is below 5 per cent. While a heritage repurpose may be a popular idea in concept, there are substantial barriers, Mr. DiNardo says.

Colliers is tracking these unique opportunities. Startups, in particular, are hungry for heritage spaces since they offer a different working experience compared with a typical corporate setting.

Heritage buildings offer atmosphere – and this is integral

For many business-owners, space in a heritage building is vital to their commercial success. It’s a topic Shari Waters has addressed many times over the years as a writer for The Balance.

Business-owners need to acknowledge how important atmosphere is to their organization’s success, and according to Ms. Waters, the atmosphere of a retail space includes the physical characteristics of the location as well as the decor. All of which is used to create an image that attracts customers.

Known as atmospherics for short, the decor and location of a business is a direct contributor to the customer experience, which is the most important element of retail today, Ms. Waters says.

Nicole Veenema, senior interior designer at West of Main Inc., fully appreciates how important atmospherics are to her clients. Last October, she worked with a client that owned a wine-tasting room and import agency. The client was adamant about the type of location that would house his business. In the end, Ms. Veenema helped find a heritage home in Ottawa’s Centretown neighbourhood.

The house, Ms. Veenema says, was built in the early 1900s and is located in a community of heritage structures.

“My client wanted to have a setting that would impress his buyers,” Ms. Veenema says. “A new building in the suburbs is just not the same.”

Even better, she adds, is that as soon as someone takes the time, money and effort to restore a heritage building, “it becomes transformative for a street and a neighbourhood.”