Figures

Toronto Downtown Office Figures Q2 2026

Office recovery spreads with more relief to come in remainder of 2026

July 29, 2026 5 Minute Read

Overall vacancy decreased by 40 basis points (bps) to 13.1% as Downtown Toronto registered over 140,000 sq. ft. of net absorption in Q2 2026. This caps an all-time high of 4.6 million sq. ft. in net positive absorption over 12 months, over 1.7 million sq. ft more than the second highest period from Q3 2016 - Q2 2017.
The overall office market is beginning to recover beyond the major core premium spaces with the predicted spread of flight-to-quality coming to pass. The combined vacancy for sub-premium product decreased by 130 bps to its lowest point since Q4 2023.
Non-core markets continue to perform well as combined vacancy in these markets decreased to 20.5% its lowest point since Q3 2023. This capped off a 12-month period with over 800,000 sq. ft. of net positive absorption and a vacancy decrease of 400 bps, with 260 bps coming in Q2 2026 alone.
Average net asking rents continue to surge in premium spaces amid persistent demand, but sub-premium space offer a reprieve for select budget sensitive tenants in the market.