Battle Of The Landlords
Landlords in existing prime office towers have had to get creative to combat rising vacancy as new product comes along, according to Colliers. During the first quarter, the region's vacancy reached 8.7%—1.5% higher than last year. Landlords are looking to incentivize tenants to get them to renew more quickly, Colliers Alexander Changfoot tells us, snapped with colleague Owen Louis. (Our librarian gets us to renew with guilt-inducing stares when she sees our bookmark is only on page 5.)
Here is the common tactics for landlords, according to Alexander: free rent (either net, with the tenant paying operating costs and taxes, or gross); TI allowances (allowing the tenant to build out their space). Renovations to the lobby, upgrading elevators, and creating more communal space are also typical methods. Upcoming new supply in the core includes the MNP Tower on W Hastings St (270k SF), Telus Garden on W Georgia St (450k SF), 745 Thurlow St (365k SF), Manulife Building on Howe St (image, 250k F), The Exchange on Howe St (400k SF), and 725 Granville St (280k SF).
