Canada Office Real Estate Market Size (2024 - 2029)

The Canada Office Real Estate market is experiencing a recovery, with its market size reflecting a robust demand for office space driven by the presence of major global firms. Despite challenges posed by the COVID-19 pandemic, which led to increased vacancy rates and delayed expansion plans, the market fundamentals are improving. The demand for premium office spaces remains strong, particularly in downtown areas, where vacancy rates are lower compared to suburban locations. Vancouver's downtown office market, despite its smaller population, commands higher rental rates, highlighting the varied dynamics within Canada's office real estate sector.

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Market Size of Canada Office Real Estate Industry

Canada Office Real Estate Market Summary
Study Period 2020 - 2029
Base Year For Estimation 2023
Forecast Data Period 2024 - 2029
Historical Data Period 2020 - 2022
CAGR 8.00 %
Market Concentration Low

Major Players

Canada Office Real Estate Market Major Players

*Disclaimer: Major Players sorted in no particular order

Canada Office Real Estate Market Analysis

The size of Canada Office Real Estate market is USD 20 billion in the current year and is anticipated to register a CAGR of over 8% during the forecast period.

  • The demand for office space is obviously quite high because Canada is home to some of the world's biggest and most successful firms. Offices are another asset class that is quite well-liked by investors. The coronavirus (COVID-19) epidemic caused the Canadian office sector to suffer, but it is now on the mend. Almost 59 billion Canadian dollars are anticipated to be invested in commercial real estate in Canada in 2022, an increase over 2020 but still much below levels in 2019.
  • The coronavirus (COVID-19) pandemic resulted in a rise in office vacancy rates for the second consecutive year in 2021. Many occupiers put off their expansion plans or lease renewals at the start of the epidemic due to the economic unpredictability, but since then, the situation has shifted and market fundamentals are gradually improving.
  • From a generally consistent cost of CAD 20 CAD (USD 14.71) in previous years to more than 24 CAD (USD 17.65) in 2021, the net asking rent per square foot for Canadian office space has similarly climbed. The demand for premier office space is still high, and in 2021, Canada supplied roughly six million square feet of new office space.
  • There are several large firms in Toronto, the largest city in Canada, including, to name a few, Capital One, IBM, and Unilever. The suburbs are where the majority of the city's office space is situated.
  • Downtown offices are more in demand as evidenced by the fact that suburban office buildings have much greater vacancy rates than downtown office buildings. Vancouver has the majority of its offices downtown, unlike Toronto.
  • Despite having a significantly lower population than Toronto, Vancouver is renowned for being quite crowded and having a vibrant downtown. Unsurprisingly, Vancouver's downtown office space costs roughly CAD 50 (USD 36.78) per square foot, which is significantly more than the country's average.

Canada Office Real Estate Industry Segmentation

Office real estate is the construction of buildings for leasing and selling purposes to companies from different sectors. This report aims to provide a detailed analysis of the office real estate market. It focuses on the office real estate sector's market insights, dynamics, technological trends, and government initiatives.

The Canada Office Real Estate Market is Segmented by Major Cities (Toronto, Ottawa, and Montreal). The report offers market size and forecasts in value (USD billion) for all the above segments.

By Major Cities
Toronto
Ottawa
Montreal
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Canada Office Real Estate Market Size Summary

The Canadian office real estate market is experiencing a resurgence after the challenges posed by the COVID-19 pandemic. Despite initial setbacks, including increased vacancy rates and delayed expansion plans, the market is showing signs of recovery and growth. The demand for office space remains robust, driven by the presence of major corporations and a preference for prime office locations. Downtown areas, particularly in cities like Toronto and Vancouver, are witnessing a rise in occupancy rates, contrasting with higher vacancy rates in suburban office buildings. The market's resilience is evident as companies like Mphasis and Microsoft expand their footprints, securing significant office spaces in key urban centers.

The market is characterized by a fragmented landscape with numerous developers and property consultancy firms actively participating. The office real estate sector is poised to regain its pre-pandemic normalcy, with a substantial development pipeline already seeing high pre-leasing rates. Major cities are witnessing increased leasing activity, with significant commitments from tech, consulting, and financial services companies. The market's recovery is further supported by strategic acquisitions and investments, as seen with Canadian Net Real Estate Investment Trust and Crown Realty Partners. These developments indicate a strong demand for contemporary office spaces, as companies prepare for a full return to office work and seek to capitalize on future opportunities.

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Canada Office Real Estate Market Size - Table of Contents

  1. 1. MARKET INSIGHTS & DYNAMICS

    1. 1.1 Market Overview

    2. 1.2 Market Dynamics

      1. 1.2.1 Market Drivers

      2. 1.2.2 Market Restraints

      3. 1.2.3 Opportunities

    3. 1.3 Industry Attractiveness - Porter's Five Forces Analysis

    4. 1.4 Industry Value Chain Analysis

    5. 1.5 Technological Innovations in the Office Real Estate Market

    6. 1.6 Government Regulations and Initiatives in the Industry

    7. 1.7 Insights into Rental Yields in the Office Real Estate Segment

    8. 1.8 Insights into the Key Office Real Estate Industry Metrics (Supply, Rentals, Prices, Occupancy/Vacancy (%))

    9. 1.9 Insights into Office Real Estate Construction Costs

    10. 1.10 Insights into Office Real Estate Investment

    11. 1.11 Impact of the COVID-19 on the Market

  2. 2. MARKET SEGMENTATION

    1. 2.1 By Major Cities

      1. 2.1.1 Toronto

      2. 2.1.2 Ottawa

      3. 2.1.3 Montreal

Canada Office Real Estate Market Size FAQs

The Canada Office Real Estate Market is projected to register a CAGR of greater than 8% during the forecast period (2024-2029)

Brookfield Asset Management Inc , Pinnacle International, Amacon, Avison Young (Canada) Inc. and CDNGLOBAL are the major companies operating in the Canada Office Real Estate Market.

Canada Office Real Estate Report Snapshots

CANADA OFFICE REAL ESTATE Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)