Toronto’s robust economy continues to drive demand throughout the GTA Office market, with overall vacancy declining -40bps this quarter to 4.7%.
- Strong demand in the Downtown and Midtown submarkets lead vacancy declines, dropping by -60bps and -50bps respectively QoQ - each now have a vacancy of 2.4%.
- This was not entirely at the expense of the suburbs, which saw vacancy decline for the fourth consecutive quarter and currently sits 7.6% vacant, representing a decline of -130bps YoY.
- Availability is declining, too; Central markets posted a 16-year low this quarter (5.3%), driven by the Downtown market, which reached a new 17-year low (4.4%). The Financial Core was the main culprit, which reached a new five-year low and currently stands at 6.6%.
- Limited new supply in the GTA continues to drive rental rates and tighten the market. 567 Michigan Drive, in the Oak West Corporate Centre, was the only new office addition in the GTA this quarter, adding 40,700 square feet of office space in Oakville.
- Major tenant movements this quarter took place within the Downtown market, as CIBC Mellon moved from the Financial Core to 1 York Street in the Downtown South.
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