Global Affairs Canada ‘very proud’ of $9M NYC condo purchase, says consul general Tom Clark didn’t influence

Canada’s consul general in New York Tom Clark did not influence the government’s decision to purchase his new official residence, a senior Global Affairs Canada official told MPs Wednesday.

“There was no influence from Mr. Clark. He was not involved in the consultation or decision process,” said senior assistant deputy minister at Global Affairs Canada Stéphane Cousineau.

After it came to light last month that Canada bought the new $9 million piece of luxury real estate within the world’s thinnest skyscraper on “Billionaire’s Row,” opposition MPs balked at the optics of the purchase and prompted a series of hearings in Ottawa.

Wednesday, Cousineau told the members of Parliament probing the official residence relocation that the government is “very proud,” of the transaction. This, he said, is because the new condo is “conveniently located” near key office buildings in the heart of the United States’ “economic centre,” and was purchased at a reduced price.

Though, GAC officials also sought to downplay the characterization of the condo and its amenities, stating the residence Canada purchased is “not in the skyscraper.”

The consul general’s new condo is located on the 11th floor of the 84-storey tower, within an older part of the building that’s been renovated known as Steinway Hall. However, officials conceded the residence shares the same coveted address.

“It feels like a little bit of splitting hairs,” said NDP MP Taylor Bachrach, who went on to ask if GAC considered the risks of locating the consulate in a building with a “controversial” construction record. 

“Our focus is on stewardship and value for money. We looked at Steinway Hall … that information is being shared today. I was not aware,” Cousineau said.

Following up on the line of inquiry around Clark, Conservative MP Michael Barrett asked Canada’s deputy consul general in New York if his colleague ever opined to him about the suitability of his accommodations.

“Mr. Clark never opined to me about the disposal of the current residence,” Robert McCubbing told the committee.

“Was he read-in on any of the options for the now-purchased residence?” Barrett followed up.

“Mr. Clark was not aware of any of the options and was not part of the process to look at any of the options,” McCubbing replied.

Clark is among the witnesses MPs want to hear from about the decision, and while there is an additional meeting on the docket next week, it has yet to be confirmed whether the former journalist will appear.

Yesterday, federal property services and treasury officials told MPs on the House Government Operations and Estimates Committee that before settling on the new condo they looked at 21 properties that ranged in price between $8 million and $21 million.

“Yes, there is the concept of best value, but this is an investment as well. There is a balance between costs and program objectives and government priorities,” said senior Treasury Board Secretariat official Samantha Tattersall.

“An apartment that’s more expensive but is accessible, supports the greening government objectives, may be best value… The lowest cost is not always the best value.”

Officials also revealed yesterday that Treasury Board or ministerial approval wasn’t needed before putting in an offer, as it came under the federal $10 million transaction limit. That threshold was increased from $4 million in 2022, after the government reviewed the average purchase price of foreign residences, MPs heard.

Beyond shedding light on these aspects of the purchase, the witnesses deferred many questions about what Conservative MPs called an “excessive” and “opulent” purchase to GAC, seeing MPs kick off Wednesday’s hearings with a laundry list of inquiries.

Reading through the list of modern finishes in the new condo, Conservative MP Larry Brock asked why “shopping at our local Leon’s or The Brick” wasn’t an option?

“The oven is $19,000, the refrigerator is $13,000, the coffee maker is $4,600, the freezer is $11,000, the dishwasher is $6,000. How on earth is that value for the Canadian taxpayer?” Brock asked.

Another line of questioning Wednesday was around what the condo board’s rules were in the new building regarding hosting parties, something the government used as part of its justification for needing to relocate, as the cooperative board at the old apartment restricted events.

“We are expecting more flexibility,” Cousineau said.

Prior to Wednesday’s meeting, GAC had issued statements indicating the move was necessary and cost-effective as the previous residence – purchased in 1961 and last renovated in 1982 – has long needed major repairs in order to meet federal accessibility standards and in order to be suitable to host influential guests.

By opting for a smaller, but newer apartment, GAC said that ongoing maintenance and property tax costs will be reduced over the long-term. Officials also noted that the view from the new condo isn’t as good and is one at the old Upper East Side apartment.

The government has also emphasized that with the old Park Avenue Manhattan residence now on the market and listed for $13 million – following an appraisal of its value – if it sells for asking would more than cover the cost of the new condo, which Canada secured under list price.

Without divulging what Canada’s acting chief appraiser’s conclusions were about the old property’s worth, MPs were told Wednesday that GAC worked with an experienced real estate broker hired through a competitive process to list the apartment at a price that reflects its current condition.

Though, as MPs parsed out during yesterday’s hearings, until an affluent buyer comes along, taxpayers are carrying the cost of Canada owning both Big Apple properties.

“I don’t wish to speculate on the amount of time it might take to sell the unit. It depends on market fluctuations, Cousineau said, in French.

According to Ottawa broker and realtor Marnie Bennett, while properties of this type tend to sit on market for a month, the government could have timed the old property’s listing better if it was looking for top dollar.

“I think if they waited to see the market stabilizing and the economy getting better, I think they could realize a larger profit,” she said. “Do I think it was a smart move on their part? Absolutely not. I think I would have waited for the spring and the fall.”

Once it all shakes out, the government’s intention is for the new condo to remain the official residence for the consul general, for the foreseeable future.

“There’s no indication that we’re going to be disposing of it anytime soon. So I would say it’s going to serve for its lifetime, which is estimated between 55 and 60 years,” said Robin Dubeau, a senior official in GAC’s property and infrastructure division.