Calgary’s suburban office market experienced 219,751 square feet of negative net absorption in the second quarter of this year, after undergoing two consecutive positive quarters, says a new report released by commercial real estate firm CBRE Ltd.
The change in occupied space pushed the vacancy rate to 21.5 per cent, up from 20.9 per cent in the first quarter of the year.
The first quarter had positive absorption of 14,938 square feet.
“A variety of factors influenced the change in market fundamentals including efficiencies gained from consolidation, densification through open environments as a workplace strategy and policies promoting remove working,” said CBRE.
“Throughout the second quarter, we continued to see the trend to Flight to Quality as activity in Class A properties outpace Class B and C competition. While data is supportive of Flight to Quality, the term itself may be an over generalization.”
A year ago, the suburban office market had a vacancy rate of 23.2 per cent in the first quarter of 2018 with negative net absorption of 85,568 square feet.
“What we are seeing is a progression of companies actively adopting new workplace strategies that consider the changing demographic of our workforce,” said CBRE.
“This advancement in workplace strategy is resulting in a demand for more creative, healthy, collaborative and thoughtfully planned work environments. Desire for amenities, advanced technological capabilities and sustainability is playing a stronger role in a tenant’s space selection criteria.”