Canada Office Figures Q3 2022

October 3, 2022

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  • 2.1 million sq. ft. of positive net absorption was recorded this quarter, though much of this was attributable to the delivery of pre-leased new supply. If excluding the gains from new supply, national net absorption would have still remained positive, totalling to 207,000 sq. ft.
  • Aligned with the four-quarter average of 14.5 million sq. ft., the recovery of national sublet space has plateaued.
  • Overall, minor recovery was noted over the quarter as vacancy decreased 10 bps to 16.4%, a first since the onset of the pandemic. This was led by further improvement in the suburbs as downtown markets remained stable at 16.9% vacant.
  • As downtown tenants prioritize quality over cost, the national vacancy rate of Downtown Class B office towers is nearly 50% higher than that of their Downtown Class A peers.
  • Office construction levels have lowered to 12.7 million sq. ft. with major project deliveries coming to market in downtown Toronto, and suburban Montreal and Halifax this quarter.