For tech businesses looking to scale, cost is a significant factor in determining the best location. Ottawa offers a highly competitive environment where companies can access world-class infrastructure, top-tier talent, and government support—all at a lower cost compared to other major North American tech hubs. With its affordability, strong innovation ecosystem, and high quality of life, Ottawa provides a strategic advantage for businesses seeking sustainable growth.
Compared to cities like Toronto, Vancouver, New York, and San Francisco, Ottawa enables tech firms to operate efficiently without sacrificing access to talent, R&D, and market reach. This balance of affordability and opportunity makes Ottawa an increasingly attractive destination for startups, scaleups, and established enterprises alike.
Why Cost Matters for Tech Businesses
Keeping operational expenses manageable is critical for tech companies, whether they are early-stage startups or multinational firms expanding operations. High overhead costs in traditional tech hubs often force businesses to divert resources from innovation to cover rent, salaries, and business taxes. Ottawa presents an attractive alternative, offering:
- Lower commercial rental rates than other major North American tech hubs such as San Francisco Bay Area, Austin, Chicago, New York, Toronto, and Vancouver.
- Competitive salaries without the inflated wage expectations of Silicon Valley.
- A business-friendly tax environment that supports investment in R&D and growth.
- Access to government funding programs to offset operational and expansion costs.
- Lower living expenses for employees, which improves workforce retention.
Talent Costs: Competitive Salaries Without the High Price Tag
Attracting and retaining top talent is a priority for any tech company, and Ottawa offers access to a highly skilled workforce without the excessive salary costs associated with larger markets.
Median Salary Comparisons:
Here is a salary comparison for in-demand positions that require 5 years of experience:
Cybersecurity Engineer
- Ottawa: CAD $85,985
- Toronto: CAD $88,037
- Vancouver: CAD $85,373
- New York: CAD $146,225
- San Francisco: CAD $187,039
Systems Engineer
- Ottawa: CAD $84,491
- Toronto: CAD $86,595
- Vancouver: CAD $84,458
- New York: CAD $114,706
- San Francisco: CAD $143,759
Project Manager
- Ottawa: CAD $77,822
- Toronto: CAD $79,531
- Vancouver: CAD $79,021
- New York: CAD $103,060
- San Francisco: CAD $127,693
Software Developer
- Ottawa: CAD $86,533
- Toronto: CAD $86,771
- Vancouver: CAD $85,314
- New York: CAD $150,076
- San Francisco: CAD $173,933
Network Engineer
- Ottawa: CAD $77,314
- Toronto: CAD $79,905
- Vancouver: CAD $78,168
- New York: CAD $110,981
- San Francisco: CAD $134,635
(Source: InfoZone | Ottawa, Toronto, Vancouver, San Francisco: City Level, New York: State Level)
Ottawa’s lower cost of living enables tech professionals to maintain a high quality of life at a lower salary threshold than in cities like San Francisco or New York, making it an attractive option for both employers and employees.
Additionally, a low employee turnover rate allows businesses to retain skilled professionals longer, reducing recruitment and training expenses.
Office Space Costs: More Affordable Commercial Real Estate
For tech companies, office space is a major operational expense. Ottawa offers more affordable leasing options compared to other major tech hubs, allowing businesses to allocate more resources to product development and talent acquisition.
Office Rent & Vacancy Rates (Q4 2024)
- Ottawa: $17.26/psf | 14.3%
- Toronto: $26.02/psf | 12.7%
- Vancouver: $33.17/psf | 9.8%
- New York Downtown: $57.03/psf | 18.8%
- San Francisco: $69.74/psf | 30.2%
(Source: Colliers Office Market Report Q4 2024 | *Gross Rent)
Beyond affordability, Ottawa’s commercial real estate market is also more flexible, offering a variety of options ranging from startup incubators and co-working spaces to large-scale corporate offices. Companies in the Kanata North Tech Park, for example, benefit from collaborative networking opportunities while maintaining a lower cost base.
Industrial & Warehouse Costs: Scaling Without High Overheads
For tech firms requiring manufacturing or warehouse facilities, Ottawa offers significantly lower costs than competing markets. This is particularly advantageous for hardware companies, e-commerce businesses, and research-intensive industries.
Average Cost Per Square Foot for Industrial Space
- Ottawa: CAD $10-$16
- Toronto: CAD $18–$25
- Montreal: CAD $12–$18
- New York: USD $30–$45
Ottawa’s strategic access to Ontario-Quebec trade corridors and major U.S. markets makes it an ideal location for companies involved in logistics, production, and distribution. With fewer supply chain disruptions compared to highly congested urban centers, businesses in Ottawa benefit from reliable transportation networks and cost-effective warehousing solutions.
Source: Colliers Industrial Market Report
Utilities and Operational Costs: A Business-Friendly Environment
Ottawa’s utility rates and business-friendly policies contribute to its affordability as a tech hub. Lower electricity and telecom costs help companies manage day-to-day operations more efficiently.
Comparative Monthly Utility Costs for Businesses
Electricity
- Ottawa: CAD $1,408.23
- Vancouver: CAD $1,224.24
- Toronto: CAD $1,485.58
- New York: CAD $4,361.86
- San Francisco: CAD $5,627.67
(Source: Hydro Quebec, for Small Power Customers on April 1, 2024)
Average Internet Costs*:
- Ottawa: CAD $56.65
- Vancouver: CAD $61.14
- Toronto: CAD $65.01
- New York: USD $64.94
- San Francisco: USD $60.54
- Washington D.C.: USD $70.72
(Source: USA Cities, Canadian Cities)
* Price can vary depending on many factors.
With Ottawa’s push for smart city initiatives and expanded broadband infrastructure, including facilities like Area X.O, companies benefit from reliable, cost-effective connectivity that supports tech-driven businesses.
Tax Incentives and Government Support for Tech Businesses
Ottawa-based companies benefit from significant government incentives, reducing overall operational costs and encouraging investment in R&D.
Key Business Incentives
- Scientific Research & Experimental Development (SR&ED) Tax Credit: Provides refunds on eligible R&D expenses.
- Eastern Ontario Development Fund (EODF): Supports business expansion, job creation, and productivity improvements by offering up to 15% in funding for eligible project costs in Eastern Ontario.
- Industrial Research Assistance Program (IRAP): Helps fund innovative projects in tech and engineering.
- Community Economic Development (CED) Funding Program: Offered by the City of Ottawa, this program provides grants to support projects that promote inclusive economic growth, job creation, and skills development within local communities.
- Ontario Research and Development Tax Credit (ORDTC): This provincial tax credit allows corporations with a permanent establishment in Ontario to claim a 3.5% non-refundable tax credit on eligible R&D expenditures conducted in the province.
- Federal and Provincial Grants: Numerous funding programs exist to support growth and innovation.
Compared to U.S. cities, where companies face higher corporate tax rates and fewer public R&D incentives, Ottawa’s government-backed programs give businesses a financial edge.
Ottawa is a Cost-Effective Tech Hub
Ottawa provides a strategic advantage for tech businesses looking to scale while keeping costs under control. With lower salary expectations, affordable commercial real estate, and business-friendly tax policies, companies can focus on growth and innovation rather than excessive overhead.
Recap: Ottawa’s Key Cost Advantages
- Lower operational costs compared to Toronto, Vancouver, and other major North American tech hubs.
- Affordable talent pool with strong academic and industry collaboration.
- Government incentives that reduce R&D and corporate tax burdens.
- More cost-effective office, industrial, and co-working spaces.
- Lower utilities and telecommunications costs supporting digital businesses.
For businesses looking to maximize their growth potential without the financial strain of larger tech hubs, Ottawa is a top choice. Invest Ottawa provides tailored resources and support to help companies establish and expand in the city.
If you are planning to expand your business in North America, choose Ottawa!
Learn about how Invest Ottawa’s Global Expansion program can help.
