Winnipeg’s overall office market has been relatively resilient through the course of the pandemic. With economic headwinds ever increasing, the challenges facing the office asset class have recently spread to the suburbs. Negative absorption in the suburbs grew significantly this quarter as several large occupiers increased their remote work position (ie. Bold Innovation in the market with 25,000 square feet of sublease space) or downsized their operations in conjunction with hybrid work models (ie: Dillon Consulting downsizing from 24,000 square feet to 18,000 square feet). Meanwhile, the Downtown office market experienced positive absorption with most of the leasing activity driven by Class B inventory.
- As organizations continue to navigate their workplace strategies, with hybrid models at the forefront, it is becoming apparent that the evolution of office inventory will continue.
- Plans for the old Hudson’s Bay site downtown, now known as Wehwehneh Bahgahkinahgohn, continue to advance, and with news that True North’s Real Estate arm could explore an acquisition of Portage Place, efforts to revitalize downtown are becoming more real than just conceptual. The absorption shifting back to downtown from the suburbs creates an added reason for cautious optimism. That said, turbulence is still expected to remain at the forefront as businesses navigate through challenges related to inflation, new workplace strategies, and the costs (both hard and soft) born as a result.
