Canadian Office Space Market

[Rico Rommheim]

Wow really? That's a damn shame.

[taal]

It's actually good ! : - )

Don't you all remember the predictions of 13%+ vacancy rates in Toronto. The theory was many of the older buildings would be left nearly empty ... it never happened.

Actually the TD center has aggressively leased most of the empty space less the largest tower, where its about 20%.

Royal bank plaza did a crazy job leasing nearly 100% of both towers !

Commerce court is the big one that's sitting at about 40% empty and has been for the last 6 months or so.


Now FCP is a bit different, pre the recession and all the construction the vacancy rate was about 13% i.e. for whatever reason that building has always had a lot of vacant space. It isn't less or more now.

Scotia and BCE are less then 5%.


This is a silly article really in many sense ... reporting on 'old news' ...

[WhipperSnapper]

FCP has usually had a few percentage points higher vacancy than BCE, Scotia but, has average less than 5% since the turn of the millenium. The 72nd floor has never sat half empty for so long. Their largest tenant lost didn't flee to a newer building though . In fact, they went to one six years older just across the street.

[taal]

Originally Posted by WhipperSnapper

FCP has usually had a few percentage points higher vacancy than BCE, Scotia but, has average less than 5% since the turn of the millenium. The 72nd floor has never sat half empty for so long. Their largest tenant lost didn't flee to a newer building though . In fact, they went to one six years older just across the street.

I can guarantee you, you are wrong

I remember reading a broker report about the available space in FCP back around 2007/8/9 i.e. before any of the new buildings came online. It was about 350,000 square feet ... which amounts to about 13%.

[Coldrsx]

The one thing that G&M article reminds us of is that it is time to begin reinvesting in some of our more prominent aging or failing buildings.

[240glt]

We're fairly lucky in Edmonton.. many of our high rise office buildings suffered through a great deal of neglect through the 90's, but as vacancy rates dropped and lease rates went up almost all owners and managers of high rise commercial buildings recognized that re-investment in their assets was crucial to attracting and retaining tenants. I spent my first five years in Edmonton primarily doing mechanical retrofits in highrise commercial buildings. Our stock is in pretty good shape compared to 10 years ago.

[Coldrsx]

^perhaps in AA and A to a certain degree... but many B are still in rough shape and C even worse.

[240glt]

Generally, Edmonton's B & C class buildings are in not too bad shape , perhaps even better when compared to other cities.

One of the larger holders of B class space in Edmonton that I am sure you know has spent multiples of millions on repairs and upgrades over the past five or so years.

One of the worst... old Epcor, should see some massive improvement with the retrofit and expansion.

[Surrealplaces]

I don't mind the idea of older class B and C buildings sitting half empty while newer class A or AA buildings are built. It can put pressure on lower rates for those buildings. Back in the 90's there was a point where Calgary's class B vacancy rate was high, and a friend of mine leased some office space at 5 dollars a square foot for his small newly formed company. That same space was 17 dollars a square foot 4 years ago.

[Doug]

I remember a similar situation in 90s where a friend got a 10 year lease on Class B space downtown for $2/sq ft.

Even buildings like PetroCan (now Suncor) offered lease rates sub $10 in the 90s for long term.

[Wigs]

Originally Posted by Surrealplaces

I don't mind the idea of older class B and C buildings sitting half empty while newer class A or AA buildings are built. It can put pressure on lower rates for those buildings. Back in the 90's there was a point where Calgary's class B vacancy rate was high, and a friend of mine leased some office space at 5 dollars a square foot for his small newly formed company. That same space was 17 dollars a square foot 4 years ago.

personally I'd like to see outdated B and C buildings be converted into mixed use
one can dream, right

I still can't believe how well Calgary's office space is doing, the amount of absorption that took place in the past year is fantastic!

[Coldrsx]

Some of Edmonton's top AA buildings had rates in the $7-10 range until the early 2000s... with those now in the $25-32 range.

[WhipperSnapper]

Originally Posted by taal

I can guarantee you, you are wrong

I remember reading a broker report about the available space in FCP back around 2007/8/9 i.e. before any of the new buildings came online. It was about 350,000 square feet ... which amounts to about 13%.

Really? My buddy worked for O&Y. The average vacancy rate was in line with the other bank towers for the 2000s. Perhaps a number of leases in 2008 were up for renewal leading to the 350,000 square feet. Even now, the amount of available, vacant space is at around 2%.

[Deepstar]

Originally Posted by Doug

I remember a similar situation in 90s where a friend got a 10 year lease on Class B space downtown for $2/sq ft.

Even buildings like PetroCan (now Suncor) offered lease rates sub $10 in the 90s for long term.

The Epcor building (formerly Alberta Wheat Pool) was charging around 3 bucks a square foot in the mid 90s

[Deepstar]

Originally Posted by WIGS

personally I'd like to see outdated B and C buildings be converted into mixed use
one can dream, right

I still can't believe how well Calgary's office space is doing, the amount of absorption that took place in the past year is fantastic!

I don't care what they do with them as long as they keep building nice AA towers

[Policy Wonk]

Originally Posted by Doug

I remember a similar situation in 90s where a friend got a 10 year lease on Class B space downtown for $2/sq ft.

Even buildings like PetroCan (now Suncor) offered lease rates sub $10 in the 90s for long term.

My present employer scored Class A space in 1994 on a five year headlease for $4.25

The principle of the company I was working for in late 90's bought an entire three story building and leased everything but the ground floor and basement. This guy has made far more from that stupid building than the business has made in 30 years. And the big payday will come when he sells it to be knocked down.

The lowest I saw downtown B space go in the most recent downturn was about $7.50 for a six year sublease.

[caltrane74]

Ramako Reports from UT / SSP

New Office Complex begins construction in Toronto. Doing what we need to, to keep pace with Cowtown.

Originally Posted by Ramako

Queen Richmond Centre West by Allied REIT is now under construction in Toronto's Entertainment District. In addition to converting a heritage warehouse into office space, the project will include an office tower constructed above the warehouse via giant x-beam supports which will feature as functional sculpture in the building's atrium lobby:

Story from UrbanToronto

More renders from UrbanToronto


From UrbanToronto

2007-2013: MaRS Centre II (750,000 sf)
2011-2014: Bremner Tower (700,000 sf)
2011-2014: RBC Waterpark Place (930,000 sf)
2012-2014: Queen Richmond (300,000 sf)

Total downtown Toronto under-construction : 2,680,000 sf

[caltrane74]

Toronto surprises agian

Toronto sucking money for commercial/corporate real estate on a global scale

Top Ten globally - read the article here

http://www.worldpropertychannel.com/...e-jll-5240.php

Los Angeles - 11
Sydney austrialia - 16
Calgary - 23

[Surrealplaces]

Very interesting to see Calgary in the top 30.

Originally Posted by caltrane74

Toronto surprises agian

Toronto sucking money for commercial/corporate real estate on a global scale

Top Ten globally - read the article here

http://www.worldpropertychannel.com/...e-jll-5240.php

Los Angeles - 11
Sydney austrialia - 16
Calgary - 23

[Doug]

Originally Posted by caltrane74

Toronto surprises agian

Toronto sucking money for commercial/corporate real estate on a global scale

Top Ten globally - read the article here

http://www.worldpropertychannel.com/...e-jll-5240.php

Los Angeles - 11
Sydney austrialia - 16
Calgary - 23

Since this is based on absolute numbers, it is not even remotely impressive. Calgary is far and away the smallest city on that list.