Colin Worrell

Montreal's office leasing market remained stable with the average asking rent increasing marginally at 1.6% YoY to $19.55. Increases in vacancy and availability resulted from class B supply injection, while AAA buildings had absorption showing that the market is still following the flight to quality trend.For the first time since Q1 2020, the Downtown Core reported positive net absorption, resulting in a 20-basis point decline in vacancy, quart-over-quarter.

Montreal’s rental market experienced an inventory increase with the availability rate jumping to 1.3%. Nonetheless, Q1 2023 marks the 6th consecutive quarters of sub-1% vacancy. Rental growth has started to decelerate as asking rental rates consolidate around the $16 net range.

Flight-to-quality persisted as much of Montreal’s class A suburban, and AAA downtown offices saw a marked decline in both vacancy and availability.