During the federal election campaign, then-candidate and now Prime Minister Mark Carney pledged that the government would act as a developer to build affordable housing, spur innovation in the housing sector and offer low-cost financing to affordable-housing builders. He promised a “lean, mission-driven organization” focused on increasing supply by leveraging public lands and partnering with the private sector.
Carney’s approach is shaped by his academic background. His PhD was inspired by Michael Porter’s The Competitive Advantage of Nations, which explores how national values, culture, economic structures, institutions, and histories contribute to a country’s economic success.
While Porter focused on what drives competitive advantage at the national level, management scholars C.K. Prahalad and Gary Hamel were examining what creates a sustainable advantage for organizations. In their 1990 Harvard Business Review article, they introduced the concept of core competencies—the unique capabilities, knowledge, and skills that set a company apart. These deeply embedded strengths serve as the foundation for creating and delivering value to customers and are not limited to any single function, but shared across the entire organization.
Prahalad and Hamel proposed a three-part test for identifying core competencies:
- Customer Relevance: A core competency must directly contribute to meeting customer needs and delivering superior value. It should help address pain points and offer compelling solutions that set the organization apart.
- Competitive Advantage: It must be difficult for competitors to imitate or replicate, offering long-term strategic benefit.
- Breadth of Application: A true core competency possesses the versatility to be applied across different products, markets, and business units, serving as the backbone of organizational learning and the catalyst for innovation and diversification.
While Prahalad and Hamel focused on companies, their insights apply to other organizations as well. For example, Canada Lands Company (CLC), a federal Crown corporation specializing in real estate development, is responsible for acquiring, redeveloping, and managing surplus federal properties. But speed is not its strength: it has been working on Currie Barracks for 27 years, Griesbach for 22 years, and Downsview for 25 years.
The disposal of federal government properties is often a lengthy and complex process. Launched in February 2019, the Federal Lands Initiative is a 10-year, $318.9-million fund designed to support the transfer or lease of surplus federal lands and buildings to eligible applicants. The initiative is led by CMHC, with support from Public Service and Procurement Canada, Housing, Infrastructure and Communities Canada, and Canada Lands Company. Although CMHC leads this program, it no longer has in-house property management expertise, having eliminated its property management group in the 1990s. Its leadership role likely stems from its mandate around housing and affordability—not property operations.
The Canada Public Land Bank was launched in August 2024. As of January 30, 2025, a list of 90 federal properties had been identified as candidates for potential housing development. However, several of these sites are projects that CLC has been working on for years. Labelling these ‘new’ developments is little more than political spin. The underlying issue remains: these agencies do not move quickly.
Property development is not a core competency of the federal government. However, the government does have indirect expertise through the Canada Pension Plan, whose real estate development arm is Oxford Properties Group. The challenge is that the CPP operates at arm’s length from the government.
In other housing initiatives, CMHC has focused on its strengths—policy and program development—while outsourcing underwriting and administration to specialized partners, as seen in the Green Home Program and the Apartment Construction Loan Program. A similar arrangement with Oxford Properties could be considered, allowing them to serve as program administrator. This would enable government agencies to concentrate on their core competencies: funding and program development.
As for innovation in this space—that’s a discussion for another day.
Independent Opinion
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