In Q4 2023, the market observed a decline in the number of transactions and leasing volume. However, this downturn was mitigated by occupiers who continued to sign significant deals in the central downtown nodes. Most deals over 20,000 SF were A or AAA-Class assets in the Central Business District.
- Landlords continued offering turnkey solutions in the form of model suites while offering enhanced amenities in communal spaces. Despite their caution regarding shorter-term leases, there is a burgeoning demand from tenants for flexible lease solutions.
- Business sector employment has seen an upward trend since the onset of the global pandemic. However, projections indicate a potential decline in 2024, coinciding with the Bank of Canada maintaining policy rates at 5.0%.
- Office occupancy data in the Greater Toronto Area indicated a deceleration in the momentum that has consistently propelled the return-to-office throughout 2023. No significant shifts are anticipated in the new year as peak office days are currently nearing 70% occupancy, while slow days floor out at around 30%.