10-Year-Low Vacancy Rate in Ottawa’s Commercial Real Estate Market
Although Canadian real estate markets have been cooling, generally speaking, the Ottawa residential real estate market has been comparatively strong in 2019. In fact, the sales to new listings ratio—a metric for judging the amount of demand in a real estate market—showed an 8.8% increase from February 2018 to February 2019, in contrast to a -2.4% decline across Canada as a whole. The strength of Ottawa’s property market is helped by the stability of its job market: Many people are employed by the government and in the thriving high-tech sector, ensuring a high average standard of living and low unemployment.
Ottawa’s Thriving Economy Eats Up Office Space
It will come as no surprise to learn that Ottawa commercial real estate is also currently in great demand. The Ottawa Business Journal recently reported that leases were taken on a total of 200,000 square feet of Ottawa office space for rent in the first quarter of 2019, pushing the vacancy rate in the city down to 7.5%. This is 0.5% lower than the previous quarter and represents a 10-year low.
Class-A Real Sector Even Hotter
The Class-A sector of Ottawa commercial real estate has been hit by demand to an even greater extent, with the vacancy rate in the center of town dropping from 5.7% to 4.7% in the first three months of 2019. This type of commercial real estate is the most desirable, and many companies will clearly pay the extra that it costs. In terms of rental costs, however, there was a slight easing, with the rate per square foot for Class-A decreasing by 63 cents.
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