Of Tents and Tenants
Avison Young VP Bill Argeropoulos has a rugged summer adventure plan: four days camping with his family in Grand Bend, Ont. "The kids were itching to go," he says. (They'll be itching even more when the bugs get a hold of them.) They'll be car camping, he admits, but there will also a tent pitched. At least he doesn't have to worry too much about the market while he's gone: After a poor Q1, the GTA office sector finished off the second quarter with higher leasing velocity, he says. Downtown, the vacancy rate fell to 6%, while the overall GTA rate (9.4%) remained the same.
Bill notes that two significant new downtown office towers coming to market next quarter, RBC WaterPark Place and Bremner Tower (centre), have created pockets of residual vacancy in older buildings left behind. Product in fringe market locations is being offered at "bargain-basement" rents as landlords struggle to deal with the spike in vacancies, "some for the first time in a long time," he says. In Q1, organizations like Metrolinx and Oracle took advantage of this, expanding existing operations into older, non-core buildings—"a bit of hope for the rest of the residual vacancy to come."
