Downtown offices struggled to increase their deal flows during the first quarter of 2022, as downsizing, flexible work trends, and increasing availability continue to negatively impact absorption.
- Downtown markets continued to see upwards momentum in vacancy even while some tenants were beginning to take advantage of empty pockets of space by expanding into existing locations.
- Downtown Class A net rents rose by as much as 11.5% year-over-year (YoY) to $25.35 per square foot, while Suburban office rates of the same class increased by 9.3% YoY. Rising construction costs are expected to put pressure on landlords as they look to provide more ‘move-in’ ready options to attract users back into the city’s core.
- The consortium of investors led by Canderel in the divestment of Cominar’s portfolio has finalized an agreement on the acquisition of $5.7 Billion worth of commercial assets. Among them were 42 retail and office properties acquired by Groupe Mach for $1.5 Billion.
- Sublease volume was driven upwards for another consecutive quarter as anchor tenants in the CBD moved to position a portion of their workforce away from the office. Total sublease volume grew 4.6% quarter-over-quarter.
