Ongoing strength in Ottawa’s high-tech sector is helping lower office vacancy rates while pushing up rental rates in Kanata, a recently released report says.
Commercial real estate services firm Colliers International says the vacancy rate in Ottawa’s west-end tech hub fell to 14.1 per cent at the end of September, down from 15.2 per cent at mid-year.
“Tenants that do not yet have a presence in the Ottawa market see spaces in Kanata as ideal, while tenants already in the market are growing in size,” Colliers’ third-quarter office report states. “Rental rates continue to creep up at a rapid pace, especially when
allowances and improvements are taken into consideration.”
The asking net rental rate climbed from $13.48 per square foot in the second quarter to $13.76, a 2.1 per cent increase over the three-month period alone.
It’s not clear whether the latest figures represent an ongoing trend or a quarterly blip. On a year-over-year basis, Kanata’s third-quarter vacancy and asking rental rents were largely flat.
Colliers’ report comes amid other signs of strengths for the local tech sector. Statistics Canada says employment continues to hover around a three-year high, with some 48,100 Ottawa-Gatineau residents reporting they work in ICT last month.
Meanwhile, local venture capital and private equity investment levels are trending above Ottawa’s five-year average, according to Thomson Reuters data.
Elsewhere in Ottawa, the citywide office vacancy rate inched down from 11.7 per cent at midyear to 11.5 per cent in the third quarter, Colliers reported.
The vacancy rate in the central business district was unchanged at 9.9 per cent.