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Ontario  + Office  | 
Downtown Toronto office buildings.

Toronto Office Vacancy Keeps Ticking Upward

A demand gap is widening between premium and standard Toronto office spaces, says a new Colliers report.

Landlords might need to offer extended free-rent periods as an incentive as a flight to quality sustains demand for premier premises. Such features allow institutions to maintain face rates and ensure the long-term success of the property, says Colliers.

“Landlords will need to enhance their amenities to stay competitive,” adds the commercial real estate services company.

In the first quarter of 2024, overall Toronto office vacancy continuing to trend upward, rising 110 basis points year-over-year to 11.6%. Downtown vacancy jumped 120 bps to 12% from 10.8% in the first quarter of 2023.

But class A and AAA vacancy in the Financial District continued to fall, indicating ongoing demand for high-quality spaces.\

Overall rents exhibited aa plateau as vacancy and availability rose together.

Avison Young recently reported that increased GO Transit ridership is not helping to reduce downtown vacancy.


Inside The Story

Avison YoungGO TransitColliers

About Monte Stewart

Monte Stewart serves as Content Director - Canada for Connect Commercial Real Estate. Based in Vancouver, British Columbia, Monte provides daily news coverage of major Canadian commercial real estate markets, including Vancouver, Toronto, Montreal and Calgary. He has written about the real estate sector for various media outlets and Avison Young since the early 2000s. In addition, he has covered sports, general news and business for several leading wire services and publications, including The Canadian Press, The Associated Press, The Calgary Herald, The Globe and Mail, Research Money, The Daily Oil Bulletin, Natural Gas World and The Toronto Star. Monte is active in his community as a youth basketball coach and raises funds for such charitable causes as Movember.

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