Increased activity from Ottawa tech firms and a global trend towards co-working led to a tightening of the capital’s commercial vacancy rate in the first half of the year, according to a new report from Avison Young.
The real estate services firm said in its mid-year report released Tuesday that Ottawa’s overall office vacancy rate sat at 8.8 per cent as of June 30, down from 9.5 per cent at the same time last year.
The suburban office market saw a sizeable drop, down to 8.1 per cent from 11 per cent a year earlier. The average gross rent for Class-A office space in the suburbs was down slightly to $32.26 per square foot.
The downtown core, on the other hand, saw vacancy rates rise to 9.7 per cent – up from eight per cent after the first six months of 2018. Average gross rent for downtown Class-A space also saw a slight dip year-over-year, standing at $43.20 per square foot.
In a release, Avison Young said the global trend towards co-working is “taking Canada by storm.” Co-working service providers such as Spaces have taken up root in Ottawa as of late, and the federal government recently opened up shared spaces across the National Capital Region as drop-in offices for employees travelling between meetings.
The report also highlighted Ottawa’s growing tech sector as “taking a bigger slice of the leasing pie.” Colonnade BridgePort CEO Hugh Gorman recently told OBJ that property managers in the downtown market in particular are shifting their offices to cater towards tech and professional services firms – an attempt to diversify property portfolios beyond public sector tenants.