This standard is effective November 1, 2006
This standard applies to all departments within the meaning of section 2 of the Financial
Administration Act, unless specific acts or regulations override it.
The Treasury Board Policy on the Management of Real Property requires deputy heads to ensure their
respective department maximizes the long-term economic advantage to the Crown, assesses opportunities to earn
revenues, ensures real property decisions are financially prudent and represent the best value to the Canadian taxpayer
and that the total consideration received or paid by the government is justified in relation to the market value of the
property.
To meet these requirements, departments must be able to determine the market value of the interests, benefits or
rights involved. This standard establishes minimum requirements for making that determination before acquiring,
disposing or entering into other arrangements with respect to real property.
This standard is issued pursuant to the Financial
Administration Act, subsections 7(1), 9(1.1), 9(2) and the Federal Real Property and Federal
Immovables Act, subsection 16(4).
Acquisition (Acquisition) - A transaction that adds real property to a department's
inventory by purchase, lease, licence, exchange, gift, easement, expropriation, transfer of administration from another
department or agent Crown Corporation or a transfer of administration and control from the provincial Crown.
Agreement (Entente) - An instrument, such as a memorandum of understanding, a memorandum
of agreement or an occupancy instrument that, while not legally binding, creates a custodian-tenant relationship by
conferring certain real property rights of use or benefits and obligations on the part of the two parties as if it were
a truly enforceable instrument.
Appraisal (Evaluation) - An adequately supported written opinion of the
market value of the
real property as of a specified date that evaluates the real property rights, interests or benefits involved according
to accepted appraisal practices.
Disposition/Disposal (Aliénation) - A transaction that alienates real property from a
department's inventory by sale, lease, licence, exchange, gift, easement, transfer of administration to another
department or an agent Crown corporation, or transfer of administration and control to the provincial Crown.
Estimate (Estimation) - An opinion, judgment or calculation of the market value of real
property, in writing, as of a specified date that evaluates the real property right, interests or benefits involved and
provides sufficient information and analysis to support the conclusion.
Market value (Valeur marchande) - The price that a
property would likely bring in a competitive and open market on a specified date under all conditions required for a
fair sale, with the buyer and seller each acting prudently and knowledgeably, and where the price is not affected by
undue stimulus.
Open market (Marché libre) - A solicitation of offers giving the public fair and equitable
opportunity to acquire real property from or to dispose of real property to the government.
5.1 Acquisition and disposition in a competitive and open market
5.1.1. Before acquiring or disposing of real property in a competitive and open market, other than through lease
or licence, departments shall:
- if the department believes the market value of the real property is not greater than $350,000,obtain at least one
current estimate based on the real property's highest and best use; or
- if the department believes the market value of the real property is greater than $350,000, obtain at least one
current appraisal based on the real property's highest and best use.
5.1.2 Before acquiring or disposing of real property in a competitive and open market by lease or licence,
departments shall obtain at least one current estimate based on the real property's highest and best use.
5.2 Acquisition, disposition or agreement for continued public purpose
5.2.1 Before acquiring or disposing of real property for continued public purpose, departments shall:
- for a transfer of administration between two departments or between a department and an agent Crown corporation,
obtain a mutually agreed to estimate based on both the real property's highest and best use as well as the property's
highest and best use considering restricted use or uses;
- for a sale or a transfer of administration and control:
- if the department believes the market value of the real property is less or equal to $350,000, obtain a current
estimate based on both the real property's highest and best use as well as the property's highest and best use
considering restricted use or uses; or
- if the department believes the market value of the real property is greater than $350,000, obtain a current
appraisal based on both the real property's highest and best use as well as the property's highest and best use
considering restricted use or uses.
5.2.2. Before entering into an agreement with another department, federal Crown Corporation or the provincial
Crown for the use of real property, custodians shall obtain a current estimate of market value based on the real
property's highest and best use considering restricted use or uses.
Notes:
- Requirement 5.2.1 (a) does not apply to custody transfers, which are effected at nominal value.
- Requirement 5.2.2 does not apply to occupancy instruments between PWGSC and tenant organizations for office
accommodations.
5.3 Sale of real property to the Canada Lands Company CLC Limited
5.3.1 Before selling real property to the Corporation, departments shall obtain from a qualified independent
appraiser:
- at least one current appraisal, in the case of a single property; and
- in the case of a portfolio of properties, at least one current portfolio valuation using bulk or mass appraisal
techniques.
5.3.2 The appraisal and the portfolio valuation shall be based on the terms of reference developed by the
Chief Appraiser at Public Works and Government Services Canada (PWGSC) for the custodian department, in consultation
with the Canada Lands Company CLC Limited.
5.4 Acquisition or disposition without a solicitation of offers
5.4.1. Before acquiring or disposing of real property where the minister is satisfied that the nature or subject
matter of the transaction is such that it would be inappropriate or would not be in the public interest to have a
solicitation of offers, departments shall:
- obtain at least one current appraisal based on the real property's highest and best use; or
- if the acquisition or disposition is by lease or licence, obtain at least one current estimate based on the real
property's highest and best use
5.5 Appraisal
5.0.1. Departments shall obtain required appraisals from PWGSC in accordance with the TB Common Services
Policy.
5.0.2. PWGSC shall ensure appraisals are duly signed by a person who is a real property appraiser accredited or
licensed by a provincial, national or international real property appraisal organization, or by a person who is
employed in the federal public service and whose qualifications are recognized by the Chief Appraiser at PWGSC.
5.6 Estimate
Departments shall obtain a duly signed estimate from a person experienced in real estate that is established in a
real estate-related business (such as appraisal, brokerage, banking), or is employed in the federal public service with
appropriate qualifications.
5.7 Independent Valuation
Departments shall ensure the segregation of transaction and valuation responsibilities and ensure these
responsibilities are clearly communicated.
Treasury Board policy instruments
Others
Please direct enquiries about this standard to your departmental headquarters. For interpretation of this standard,
departmental officials should contact:
Real Property and Materiel Policy Division
Treasury Board of Canada Secretariat
L'Esplanade Laurier
140 O'Connor Street
Ottawa ON K1A 0R5
Telephone: (613) 941-7173
Facsimile: (613) 957-2405
E-mail: rpmpd@tbs-sct.gc.ca
|
