Saskatoon’s Downtown office market continues to favour tenants in Q2, as vacancy rates remain high and landlords grapple with surplus space. The Suburban market continues to perform well, attracting tenants with high quality of product and unique amenities.
- The Downtown vacancy rate currently sits at 18.6%, an increase of 140 basis points over Q1 2023. The Suburban market performed better over the past quarter, with vacancy rates holding at 7% quarter-over-quarter.
- Despite high vacancy rates, rents in the Downtown market remain relatively stable. The average asking net rent in the Downtown market was $20.09 per square foot in Q2, marking a 0.9% decrease from Q1. The Suburban market experienced a quarterly increase of 3.4% in Q2, with the current average asking net rate sitting at $18.88 per square foot.
- Elevated construction costs continue to have a restricting influence on the office market – both in terms of developments and tenant behaviors. Tenants citywide are showing preferences for either renewing their current leases or moving into built-out spaces, due to escalation of costs and delays in construction.