The office market in Toronto has continued to grow strongly into 2014. With more options than ever before, tenants can afford to be choosy and hold out for the best locations as they become available. Whether you are already based in Toronto or are looking to relocate there, making the right decision can be tough. Here are five research-backed trends that will help you lease the perfect Toronto office space in 2014.
Trend #1. Prioritizing Location Over Space
More tenants are prioritizing location over space. This trend was identified by looking at the average size of office space being rented. Tenants are choosing to rent smaller office spaces in better locations in order to drive their growth. If you are looking to lease office space in Toronto during 2014, this trend may influence your decision.
Trend #2. Downsizing To A Prime Location
As you’ll understand, businesses cannot afford to simply lease office space in better locations. The inevitable compromise is space. This is the second trend to have been identified. It is predicted that the office market trend in Toronto over the coming years will be for businesses to relocate to smaller ‘footprints’ in premium locations. While ‘the average vacancy rate across the GTA has dropped by two basis points to 5.8 percent quarter-over-quarter’, analysts expect this trend to reverse as most companies choose smaller office spaces in better locations.
Trend #3. Rising Vacancy Rates In Sub-Markets
Vacancy rates in sub-markets are expected to rise as suburban tenants continue to show a strong preference for smaller office spaces in premium locations. These locations are being created in close proximity to Toronto’s expanding public transportation lines, running south of the city. There are ‘5.4 million square feet of office space under construction in the GTA’. This oversupply and rising vacancy rate in non-prime locations may influence your decision over where you lease office space in Toronto.
Trend #4. Tenants Are Leaving The Suburbs
One of the strongest trends to have emerged from 2014 so far is the exodus of tenants from suburban offices to downtown locations. This has created a market imbalance where vacancy rates in suburban office premises are rising, yet net rental rates on downtown offices are increasing. If you are looking to lease office space during 2014, this could influence your decision.
Trend #5. Relocations Are Tech-Driven
Downtown Toronto offers technological advances that suburban office spaces cannot match. This has been noted as one of the principle reasons behind tenants’ decision to move. Despite the drawbacks of downsizing, companies are keen to take advantage of the high-tech amenities on offer in downtown Toronto. This is an important trend to take note of for any business looking to lease Toronto office space in 2014.
These five trends should help any business choosing the perfect office space for lease in Toronto this year. What do you think of our five trends? What did we miss? Let us know which trends you have identified and leave us a comment below!