Vacancy rate hits highest point since 1994 as working from home wallops office demand
Nearly one out of every six offices in Canada is vacant right now, commercial real estate firm CBRE says, as the pandemic trend of working from home has obliterated demand for office space.
CBRE Group Inc. says the national office vacancy rate hit 15.7 per cent in the third quarter for the highest level since 1994 as people continue to work from home because of COVID-19.
The commercial real estate firm says that a fourth wave has slowed an expected return to work, helping push up the vacancy rate from 15.3 per cent in the last quarter.
Two years ago, before the pandemic, the national office vacancy rate was 11 per cent.
While the rate is higher, CBRE does say that leasing activity is picking up, driven especially by demand from the technology sector, and that four of 10 major Canadian markets saw increased occupancy.
Vancouver’s vacancy rate remains the lowest at 7.4 per cent, while Toronto stands at 13.7 per cent and Calgary at 30.1 per cent.
The story is quite different on the industrial front, where vacancies are low as demand for distribution and logistics space remains at an all-time high.
CBRE says the national vacancy rate for industrial space was at two per cent in the quarter, while several markets including Vancouver, London, the Waterloo Region and Toronto have availability rates of less than a per cent.