Canada Flexible Office Space Market Size
| Study Period | 2020 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 1.22 Billion |
| Market Size (2029) | USD 1.75 Billion |
| CAGR (2024 - 2029) | 7.58 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Canada Flexible Office Space Market Analysis
The Canada Flexible Office Space Market size is estimated at USD 1.22 billion in 2024, and is expected to reach USD 1.75 billion by 2029, growing at a CAGR of 7.58% during the forecast period (2024-2029).
With tenants realizing that pandemic-driven uncertainty is set to continue, they’re increasingly incorporating flex space into their workplace strategies as they move toward a more agile footprint that adapts to their changing needs. Employers and employees have very different preferences in terms of managing the return to the physical office. Companies can reconcile these differences with flex space. Looking ahead, the broader concept of flexibility will be critical for the office market—not just in terms of how spaces are designed and used but also in the physical locations where people gather and work.
Canadian cities, particularly Toronto, Vancouver, and Montreal, have vibrant startup ecosystems and attract entrepreneurs and tech companies. As a result, demand for flexible office spaces has increased in these urban centers. The Canadian flexible office space market has seen the entry of various coworking operators, from global providers like WeWork to local and specialized coworking spaces catering to specific industries or communities.
In the first quarter of 2023, office vacancy continues to climb in Canada's key cities as the sector underwent a once-in-a-generation transition, with tenants attempting to adjust to hybrid work and office owners attempting to preserve their attraction. As a result, the sector is in upheaval, with a growing divide appearing between uninspiring older workplaces and well-amenitized new premises. In 2023, the downtown office vacancy rate in Toronto will be 15.3%, the highest since 1995 in Canada's largest office market. The downtown office vacancy rate in Vancouver increased to 10.4%, the most since 2004, while Ottawa (13.2%) and Montreal (16.5%) also reached their all-time highs.
Canada Flexible Office Space Market Trends
Toronto is set to revolutionize the market in the years to come.
The Toronto market stands out as the national leader with regard to flex office inventory, representing 40.8% of the country’s total flex inventory, totaling 2.7M square feet. Canada’s next three largest markets, Vancouver, Montreal, and Calgary, proportionately take up 1.4M square feet (20.8%), 836,000 square feet (12.7%), and 784,000 (11.9%) of national flex office inventory, respectively. The majority of Canadian markets remain in the infancy stage of flex office space, with eight of the twelve markets totaling less than 300,000 square feet of inventory.
With further compression of the region’s 4.0% office vacancy rate (Q4 2019), acceleration of rental rate growth in core submarkets, and home to the country’s largest tech hub, flex office is incredibly popular among Toronto’s tenants as it allows them to be nimble in a rapidly evolving market.
Lately, the office space lease numbers are on an upswing. IBM Canada announced a new office in Downtown Toronto in 2021. This new space will include an AI and hybrid cloud client showcase center, collaboration spaces for use by both employees and clients, and space for IBM Garage, a globally recognized design approach to innovation and digital transformation. This space will be located at 16 York Street, Toronto.
Recently, CBRE, one of Canada’s largest commercial real estate firms, released its Q1 2021 report, which highlighted the Downtown Toronto core. CIBC Square, a flagship development by Ivanhoe Cambridge and Hines, completed construction in the first quarter of 2021, bringing 1,500,000 sq. ft. of Class A space to the Downtown Toronto market, with CIBC being the anchor tenant.
In 2022, the asking rent for office space in Downtown Toronto amounted to CAD 41.9 per square foot. Downtown South Toronto was the most expensive submarket in the city, followed by the Financial Core submarket. Although quantitative measures continue to point to a suppressed market, there are signs of optimism: an uptick in qualitative measures such as tour activity and interest from prospective tenants, as reported by brokers and landlords.
Growing Startups in Canada boosting the market
The Canadian government has been actively supporting entrepreneurship and innovation through various programs, grants, and tax incentives. Initiatives like the Startup Visa Program have attracted foreign entrepreneurs to launch their ventures in Canada. Cities like Toronto, Vancouver, Montreal, and Ottawa have emerged as vibrant tech hubs, attracting startups with a diverse pool of talent, research institutions, and a strong entrepreneurial community. Canada's strategic location and trade agreements offer startups access to a broad global market, including the United States and international markets.
Canadian startups span a wide range of industries, including technology, artificial intelligence, biotech, clean energy, fintech, and more. This diversity has contributed to a robust and resilient startup ecosystem. Several Canadian startups have achieved success, leading to significant exits through acquisitions or initial public offerings (IPOs). These success stories attract further investment and talent to the Canadian startup ecosystem. The perception of entrepreneurship has evolved positively in Canada, with more individuals and graduates considering startups as a viable career path.
Canada Flexible Office Space Industry Overview
Canada's flexible office space market is fragmented, with a lot of companies in the industry. The developers are trying to bring new and lower-cost products to meet the current demand. Evolving technological advancements such as new proptech solutions are driving the market in terms of increased transactions and better management of real estate services.
Some of the major players in Canada are Regus, WeWork, Workhaus, iQ Offices, and LiquidSpace, among others.
Canada Flexible Office Space Market Leaders
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Regus
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Workhaus
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iQ Offices
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WeWork
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LiquidSpace
*Disclaimer: Major Players sorted in no particular order
Canada Flexible Office Space Market News
June 2023: As the need for flexible workspace grows across the country, IWG, the world's leading provider of hybrid working solutions, including the Spaces and Regus brands, is building a new facility in Red Deer, Alberta. This opening is being done in collaboration with East Lincoln Properties, which has a management agreement with the Regus brand. This is the city of Red Deer's first flexible workspace. The new Regus facility, located at 4909 - 50th Street, will open in early 2024 in a recognized historical structure originally held by the Government of Canada. The 10,000-square-foot Regus will be on the building's top level and will include coworking space, private offices, conference rooms, and creative areas.
January 2023: Workhaus teamed up with Techstars to build out the newest tech startup hub in Toronto. Techstars Toronto is now running its winter class out of one of Workhaus’ downtown coworking locations. This collaboration is providing a fantastic opportunity to give a great hybrid experience to new Techstars founders and companies.
Canada Flexible Office Space Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Study Assumptions
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
- 4.1 Market Overview
- 4.2 Technological Trends in the Industry
- 4.3 Government Initiatives and Regulatory Aspects
- 4.4 Industry Value Chain Analysis
- 4.5 Insights on Office Rents
- 4.6 Insights on Office Space Planning
- 4.7 Impact of Covid-19 on the market
5. MARKET DYNAMICS
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5.1 Market Drivers
- 5.1.1 The rise of remote work and flexible work arrangements has led to increased demand for flexible office spaces
- 5.1.2 Canada has a thriving entrepreneurial culture, with a growing number of startups, freelancers, and small businesses
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5.2 Market Restraints
- 5.2.1 Some flexible office space operators sign long-term leases with landlords, committing to fixed rental payments, while offering more flexible terms to their clients
- 5.2.2 Health and Safety Concerns
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5.3 Market Opportunities
- 5.3.1 Larger companies and corporations are increasingly incorporating flexible office spaces into their real estate strategies
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5.4 Porter's Five Forces Analysis
- 5.4.1 Bargaining Power of Suppliers
- 5.4.2 Bargaining Power of Consumers/Buyers
- 5.4.3 Threat of New Entrants
- 5.4.4 Threat of Substitute Products
- 5.4.5 Intensity of Competitive Rivalry
6. MARKET SEGMENTATION
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6.1 By Type
- 6.1.1 Private offices
- 6.1.2 Co-working space
- 6.1.3 Virtual Office
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6.2 By End-User
- 6.2.1 IT and Telecommunications
- 6.2.2 Media and Entertainment
- 6.2.3 Retail and Consumer Goods
- 6.2.4 Other End-Users
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6.3 By City
- 6.3.1 Toronto
- 6.3.2 Vancouver
- 6.3.3 Montreal
- 6.3.4 Other Cities
7. COMPETITIVE LANDSCAPE
- 7.1 Overview (market Concentration and Major players)
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7.2 Company Profiles
- 7.2.1 Regus
- 7.2.2 Workhaus
- 7.2.3 iQ Offices
- 7.2.4 WeWork
- 7.2.5 LiquidSpace
- 7.2.6 Spaces
- 7.2.7 Coworker
- 7.2.8 Flexday
- 7.2.9 Spacent
- 7.2.10 Instant Offices*
- *List Not Exhaustive
8. FUTURE OF THE MARKET
9. APPENDIX
** Subject To AvailablityCanada Flexible Office Space Industry Segmentation
A flexible workspace is also known as a shared office space. This type of office space is fitted with basic equipment, like phone lines, desks, and chairs, a setup that allows employees who normally work from home or telecommute to have a physical office for a few hours every week or every month.
Flexible office space is a type of workspace that allows employees to work in a number of locations and different ways. Workers in a flexible office space can choose the section of the workplace that best matches the type of work they need to complete at the time, as opposed to typical offices with fixed and assigned desk locations.
Canada's flexible office space market is segmented by type (private offices, co-working spaces, and virtual offices), by end-user (IT and telecommunications, media and entertainment, retail and consumer goods, and other end-users), and by key cities (Toronto, Vancouver, Montreal, and other key cities).
The report offers market size and forecasts in Values (USD) for all the above segments.
| By Type | Private offices |
| Co-working space | |
| Virtual Office | |
| By End-User | IT and Telecommunications |
| Media and Entertainment | |
| Retail and Consumer Goods | |
| Other End-Users | |
| By City | Toronto |
| Vancouver | |
| Montreal | |
| Other Cities |
Canada Flexible Office Space Market Research FAQs
How big is the Canada Flexible Office Space Market?
The Canada Flexible Office Space Market size is expected to reach USD 1.22 billion in 2024 and grow at a CAGR of 7.58% to reach USD 1.75 billion by 2029.
What is the current Canada Flexible Office Space Market size?
In 2024, the Canada Flexible Office Space Market size is expected to reach USD 1.22 billion.
Who are the key players in Canada Flexible Office Space Market?
Regus, Workhaus, iQ Offices, WeWork and LiquidSpace are the major companies operating in the Canada Flexible Office Space Market.
What years does this Canada Flexible Office Space Market cover, and what was the market size in 2023?
In 2023, the Canada Flexible Office Space Market size was estimated at USD 1.13 billion. The report covers the Canada Flexible Office Space Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the Canada Flexible Office Space Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Canada Flexible Office Space Industry Report
Statistics for the 2024 Canada Flexible Office Space market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Canada Flexible Office Space analysis includes a market forecast outlook 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
