Canadian Office Market
Sublease office space now accounts for 20% of the Canadian rental market as more and more companies downsize their operations. The overall vacancy rate in central business districts (CBD’s) is now nearly 6% in Q1 2009, up from 5.1 per cent in Q4 2008. This is having an adverse effect on demand, with downtown office rents down by 5.8 per cent to $47.50 per sq ft. Many of the companies that are downsizing are subletting space that had been earmarked for expansion.
The Canadian office market is facing the same problems as the US market in that there is torrent of sublease space that is bringing down rents, as well as pushing companies away from taking lets in new space.