Commercial landlords thinking outside of the box in wake of high vacancy rates
A developer with a 50 per cent stake in a proposed residential tower project that would occupy a full city block downtown says he remains bullish about the Beltline’s real-estate market, despite Alberta’s recession.
An office report from Barclay Street Real Estate pegs the city’s current downtown vacancy rate at 22.1 per cent, but notes that skyscrapers still under construction could push the rate to 25.6 per cent next year and 26.4 per cent in 2018.
Suburban office vacancies encouraging landlords to be flexible.
"We're in the doldrums right now," said Ian Robertson, associate specializing in the suburban office market for Barclay Street Real Estate. "There's too much space chasing too few tenants. So it's a bit of a malaise".
Barlcay Street Real Estate recently forecast that new developments could push downtown office vacancy rates up to 24 per cent in 2018, and office vacancy rates in the adjacent Beltline neighbourhood could climb to 19.6 per cent over the same period. The vacancy issue has driven down prices for tenants — “There’s never been a better time to look at space than right now,” Barclay Street associate Bill Falagaris said — but has forced developers to reconsider projects that are planned, and completion dates for office buildings that are already under construction.
Calgary's industrial sector showing signs of strain. Report by Barclay Street Real Estate noted market dynamics in Calgary industrial scene are currently in favour of the tenant or purchaser, with sublease options being marketed at aggressive rates.
“Click and collect” retailers are boosting demand in Calgary’s surprising tight retail sector, which will see nearly 500,000 square feet of new space added this year.
Calgary's emerging office condo market remains hot this year, according to Barclay Street Real Estate.
Near-empty skyscrapers and rising vacancy rates are pressuring landlords to offer big incentives – such as a year of free rent or money for renovations – to keep a shrinking number of tenants in their downtown Calgary towers.
New retail development in the Calgary region continues at a steady pace despite the depressed economy and sliding consumer spending, according to local officials.