Sun
TORONTO — The national vacancy rate for office space has risen modestly to 8.4 per cent in the second quarter of this year, but that’s not the case in Vancouver and certainly not in Calgary, according to a report by CB Richard Ellis.
The commercial property firm said yesterday that tenant demand flattened in some smaller markets — but Calgary likely has the world’s tightest market for high-end downtown office space.
The overall rate was up from 8.1 per cent in the first quarter, ending nine straight quarters of tighter supply, the company said.
CB Richard Ellis said demand substantially exceeds supply in Calgary, which has an overall office-vacancy rate of 1.5 per cent and a mere 0.2 per cent for class A downtown space, “even lower than Tokyo, which traditionally has the lowest vacancy rate of any major city.”
Vancouver’s vacancy rate continues to drop, standing at 8.5 per cent overall and 6.5 per cent downtown.
Nationally, “we see the fractional rise in vacancy rates more as a period of adjustment than anything else and are not concerned about it at all,” stated Blake Hutcheson, president of CB Richard Ellis.
“We do not view this as the beginning of any long downward trend where demand decreases substantially,” he said.
He added that a factor suppressing demand in some places is that many tenants have already made commitments for office space over the past two years, taking advantage of relatively low rents.
Of the 10 cities surveyed, vacancy rates declined during the second quarter in seven: Vancouver (8.5 per cent), Calgary (1.5), Edmonton (7.3), Ottawa (6.7), Toronto (9.1), Montreal (12.3) and Halifax (8.8).
They rose in London, Ont. (16.5 per cent) and the Waterloo, Ont. region (9.0), while Winnipeg’s rate was unchanged (7.2). —
© The Vancouver Province 2006
