Slate Office REIT’s management team expects building occupancy to grow in 2024 in wake of a newly secured 107,000-square-foot Toronto lease deal.

“Occupancy will increase,” says Brady Welch, Slate’s interim CEO. “We have limited lease rollover in the next 12 months. Our pipeline of active discussions with new leasing and renewals is probably over 700,000 square feet.”

Welch made the comments on a conference call with analysts and reporters after the REIT released its latest quarterly report. In the fourth quarter of 2023, Slate’s occupancy declined 2.6% year-over-year, the report shows.

The quarterly results came a day after Slate leased out the 107,000 sf in the West Metro Corporate Centre to a Canadian technology company. The new tenant will relocate to the tower in 2025.

The property is located at 195 the West Mall in the Etobicoke area, formerly a separate city.

The Toronto office market, like the entire Canadian sector, has grappled with occupancy declines in the wake of the COVID-19 pandemic and tenant employees’ hybrid work patterns. But Welch emphasized that tenants are willing to occupy space on a long-term basis.

“Tenants are looking to commit to space,” he said. “They need to have people in the office where they can collaborate.”

Despite market uncertainties, Slate executives remain optimistic.

“It is not the most ‘normal’ market,” said Welch. “I think everyone knows that. What we are trying to do is identify properties that are non-core for us long-term, and then be able to sell those to move on, so we can recycle that capital into markets and assets that we believe in long-term.”

Toronto-based operates globally. The REIT previously announced plans to sell 40% of its gross leasable area to reduce a large debt load.

Photo: Slate Office REIT