Saskatoon’s office market showed stability in Q4, due in part to a strong and growing local economy. The market continues to be favorable for tenants, particularly in the downtown core, where high vacancies persist in older stock buildings.
- Net asking rents experienced a quarter-over-quarter decline of 3.3% in Q4 and are currently sitting at a citywide average of $19.83 per square foot. Despite the drop in Q3, average net rents have remained relatively stable, year-over-year.
- The overall vacancy rate saw a slight quarterly increase of 10 basis points in Q4, due in part to the completion of a 41,000 square foot Class A medical office building in the Suburban market.
- Absorption turned positive in Q4, primarily driven by full occupancies of newer builds in the Downtown market.
- To increase occupancy levels in the Downtown market, some landlords continue to offer tenant incentives such as below-market net rental rates and reduced parking costs. Tenants across the city continue to favour fixtured spaces, driven by the persistent high costs of construction.