Office asking rents held up remarkably well during the pandemic, continuing to rise in most markets. However, Q1 saw the first national decline in years, albeit a slight decrease of less than 1% from last quarter, and rents were still up year-over-year. Rents declined quarter-over-quarter in Montreal, Edmonton, Waterloo and Toronto.
- 2023 could mark a shift in how excess office towers are to be treated. Several markets have either announced or have already begun converting certain office towers into residential spaces. This may have a ripple effect on the office construction pipeline if projects are put on pause or even cancelled outright.
- The national industrial vacancy rate experienced a slight increase in Q1 2023 but remained very strong nationwide. Each of Colliers’ tracked markets that were below a 1.0% vacancy rate in Q4 2022 saw increased vacancy in Q1 2023. Industrial vacancy is still tight despite record high construction and warehouses remain a "landlord's market".
- National average industrial asking net rents continue their steady climb, currently sitting at $13.81 per square foot, which represents a remarkable 32% annual increase. Affordable prices relative to Toronto and Vancouver can be found in the prairie markets, none of which are currently above $12 per square foot, but these areas are also experiencing rapid rent growth.