Toronto office vacancy rates drop 3.8 per cent during Q1 | 22 April 2014
Office vacancy rates in downtown Toronto, Canada fell to just 3.8 per cent during the first quarter of this year, a new report shows.
According to thestar.com, the report from Colliers International reveals that a year earlier, office vacancy rates stood at 4.1 per cent, showing demand is on the up. In fact, more businesses are looking to move downtown, but they’re also choosing to downsize at the same time.
In order to save money, businesses are renting energy efficient, open offices, instead of picking buildings with big corner rooms. However, this downsizing could push vacancy rates up eventually, with Colliers estimating rises in 2016 or 2017.
Mixed-use offices and condo towers have partly helped push office rates down, as now more people are able to live and work in downtown Toronto. Therefore, more businesses are making the move to be close to where the young talent is residing.
John Arnoldi, executive managing director for Colliers Toronto, comments on the trend: “It’s not like the suburbs are empting out and moving back downtown, but you will see some deals announced in the near future of tenants who are moving back to the core,” he explains. “The migration to the suburbs has seemingly stopped and there is a bit of reverse migration now.”
In comparison, office vacancies in Ottawa are on the up, which in turn is pushing rents down, reports obj.ca. Instead of more businesses moving to the downtown area, they’re actually being driven away due to the high rents and reduction of the federal civil service.
The views expressed in this post are those of the author and are not necessarily those of Qube Global Software. All facts are verified where possible directly by the author.
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