The City of Ottawa’s finance and corporate services committee has endorsed a public-private partnership (P3) to design, build, finance and maintain a new West Deployment Facility for the Ottawa Paramedic Service, clearing the path for a massive infrastructure project slated to begin construction in 2027.
At a meeting on Tuesday (Feb. 3), the committee approved the design-build-finance-maintain (DBFM) model for the new headquarters at 4061 Strandherd Dr. The recommendation now goes to council for final approval on Feb. 11.
The project aims to address critical overcrowding at the service’s current headquarters on Don Reid Drive, which was built in 2005 for 330 staff and 80 vehicles. The service has since grown to more than 900 staff and 160 vehicles, forcing operations into a facility that staff say can no longer safely support the volume of emergency response required by the growing capital.
According to a business case prepared by Ernst & Young (EY), the project has an estimated capital value of $185.6 million (Class D estimate). The proposed timeline sets a financial close date of June 1, 2027, with construction expected to begin on July 1, 2027.
The target for substantial completion is Sept. 30, 2030, allowing operations to commence in October of that year.
The new facility will function as a second “hub” in the service’s hub-and-spoke deployment model. Functional requirements include indoor climate-controlled vehicle storage, Level III disinfection and decontamination areas, medical supply stores, paramedic briefing rooms, and a mechanic bay for light vehicle repairs. The site will also feature high-efficiency HVAC systems and be built to post-disaster seismic standards.
City staff and consultants recommended the DBFM model over traditional Design-Bid-Build (DBB) or Design-Build (DB) options following a comprehensive value-for-money analysis.
The analysis found that the DBFM model could deliver a potential value-for-money savings of 22.6 per cent, equating to approximately $52.1 million in net present value, compared to the traditional DBB model.
“The positive VFM benefit of the DBFM model is attributed to potential efficiencies in consolidation of scope for design, construction and maintenance under a single contract… as well as significant risk transfer to the contracted partner,” the staff report states.
Under this model, the private sector partner assumes risks related to design, construction, financing, and long-term maintenance. The city will make fixed payments over a 30-year term, similar to a “capital lease” arrangement.
Crucially, this structure allows the city to maximize provincial funding. The Land Ambulance Service Grant (LASG) reimburses 50 per cent of eligible costs. Under a DBFM model, interest expenses and amortization included in the lease payments are eligible for this grant, whereas they might not be under traditional financing methods.
A market sounding process conducted by EY revealed strong industry interest in the project. Seven major organizations participated in interviews, including heavy hitters such as PCL, EllisDon, Bird Construction, Aecon, and Chandos Construction.
While some participants expressed a preference for a Design-Build model to avoid financing costs, those interested in the DBFM approach noted it allows for “greater efficiency and alignment of project scope elements in combining design, construction and maintenance activities,” according to the business case.
Participants indicated that a lead time of approximately six months would be required to form consortia and prepare responses for the procurement process.
If the city council approves the recommendations on Feb. 11, city staff will proceed with developing a procurement strategy. The city has already approved $4 million in capital funding to cover pre-construction activities, including design requirements and engineering services.
The city intends to return to council for approval at key milestones, including the procurement strategy, the selection of a preferred partner, and the finalization of the project agreement.
