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Colliers Toronto office market report 2015 q3

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Colliers Toronto office market report 2015 q3

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Colliers Toronto office market report 2015 q3

  1. 1. Research & Forecast Report GREATER TORONTO AREA OFFICE MARKET Third Quarter 2015
  2. 2. 2 Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International Market Summaries GTA Market Overview.....................................................................................................3 Downtown................................................................................................................4 Midtown...................................................................................................................5 Central North...........................................................................................................6 Central East............................................................................................................. 7 GTA East..................................................................................................................8 GTA North................................................................................................................9 GTA West............................................................................................................... 10 Glossary............................................................................................................................... 11 Table of Contents
  3. 3. 3Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International GTA Market Overview Market Overview The Greater Toronto Area (GTA) office market remained steady in Q3 2015 as the overall vacancy rate declined slightly to 5.4 percent, while the availability rate decreased to 10 percent. The office market was stable throughout the GTA this quarter, as most office submarkets saw their vacancy rates remain relatively unchanged compared to the previous quarter. No new office space was added to the market this quarter, however, this is not a signal that office construction throughout the GTA is slowing down as almost 5 million square feet of office space is currently under construction. In addition, more than 50 office and mixed-use office buildings are proposed throughout the region, which could lead to an even greater amount of future office stock in the market. Of the office space that is under construction, about 4 million square feet are Class A buildings or above. With the newly constructed 88 Queens Quay and 120 Bremner Blvd becoming almost fully occupied throughout 2015, it will be interesting to see how the market responds to the large amount of new space that is under construction. With large amounts of pre-leased new office stock , once delivered, the leasing velocity as to which the remaining new space is absorbed, should provide a measurement of the demand for additional new office space, now in the proposal stages. Investment Market According to RealNet data, the Toronto investment market saw a gradual decrease in activity from Q2 2015 (more than 60 transactions) and has continued to remain relatively slow in transaction activity in contrast to Q3 2015 (about 50 transactions). According to Real Capital Analytics, the total office sale volume in Toronto was the smallest in the past three years. This is partially due to the fact that supply of quality assets on the market is low and large institutional property holders continue to keep their quality assets. Despite the slowdown within the central markets in previous quarters, a few notable sales were completed within the city of Toronto within the Downtown East and Midtown submarkets. These were Woodcliffe Corporation selling King James Place to Northam Realty Advisors for $59.5 million and Evton Capital Partners selling One St. Clair Avenue West to Slate Properties Inc. for $33.5 million. Market Indicators Relative to prior period Market Q2 2015 Market Q3 2015 Market Q4 2015* Trend VACANCY RATE 5.6% 5.4% NET ABSORPTION 391,852 430,215 AVAILABILITY RATE 10.7% 10.0% AVERAGE ASKING NET RENT $18.65 $17.93 *Projected Occupier Demand The financial services sector is once again leading demand for office space throughout the GTA and specifically in the Downtown South, Financial Core, Downtown West and GTA West. Companies within engineering and technology/ software industries are also looking for space within the GTA, but almost exclusively throughout the GTA West. The technology/software industry continues to grow and expand throughout the GTA office market and will likely continue to demand office space in the region. Government services companies/organizations are also increasing their demand for space, compared to previous quarters. Demand for all office space seems to be geographically focused towards the Downtown, GTA North and GTA West markets. Q3 2015 – 1,432,000 Square Feet Financial Services Engineering Technology/Software Other (Entertainment, Communications, Media, Transportation and Retail Trade) Government Services Architectural, Engineering and Related Services Communications/Technology Security Services Communications/IT Banking Transportation 41% 15% 10% 8% 6% 5% 4% 3% 3% 3% 2% Historical Performance and Forecast 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% -500,000 0 500,000 1,000,000 1,500,000 2,000,000 2,500,000 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 20151Q 20152Q 20153Q 20154Q 20161Q 20162Q 20163Q (600,000) (400,000) (200,000) - 200,000 400,000 600,000 800,000 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 2009Q2 2009Q3 2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 Net Absorption (SF) New Supply (SF) Vacancy Rate (%)
  4. 4. 4 Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International Downtown The overall vacancy rate within the Downtown office market declined slightly this quarter, while leasing activity remained steady. The Downtown West, East and South vacancy rates remain low with the supply not meeting the demand. With the completion of 351 King Street East set to take place in 2016 and the pre-leasing success within this building, the Downtown East could see greater interest from tenants and developers looking within the Downtown market, but outside of the Financial Core. Trends >> About 4 million SF of the currently 5 million SF of office space that is under construction is located within the Downtown office market. >> Every building that has been built within the past year in the Downtown South office submarket have been 100% leased. Notable Lease Transactions TENANT NAME - ADDRESS TYPE APPROXIMATE SIZE (SF) 1. CI Financial - 2 Queen Street East Renewal / Expansion 73,557 + 24,226 2. MacLaren McCann - 200 Wellington Street West Headlease 59,000 3. Liberty International Underwriters - 181 Bay Street Renewal 36,668 Summary Statistics Q3 2015 Regional Office Market Q2 2015 Q3 2015 Trend Office Inventory 75,928,990 75,294,820 Net Absorption 236,367 224,935 Vacancy Rate 2.6% 2.3% Availability Rate 7.7% 7.4% Average Asking Net Rent $29.18 $28.89 Notable Lease Notable Sale New Supply Upcoming New Supply ADDRESS CLASS FLOORS SIZE (SF) DEVELOPER COMPLETION STATUS 7. 22 Adelaide Street West AAA 44 1,020,000 Brookfield Financial Real Estate Group Q1 2016 Under Construction 8. 351 King Street East A 17 500,000 Q2 2016 Under Construction 9. 1 York Street A 35 800,000 HOOPP / Menkes Q3 2016 Under Construction 10. 100 Adelaide Street W AAA 40 905,722 Oxford Properties Group Inc. Q2 2017 Under Construction 11. 130 Queens Quay E A 178,300 The Daniels Corporation Q2 2019 Under Construction Notable Sale Transactions PURCHASER - ADDRESS PRICE APPROXIMATE SIZE (SF) 4. Northam Realty Advisors - King James Place $59,500,000 79,133 5. Free The Children - 339 Queen Street East $14,500,000 43,500 6. Hullmark - 474 Wellington Street West $12,529,923 20,237 TORONTO Union Dundas Bloor / YongeBay Castlefrank Wellesley Queen’s Park Carlton StCollege St Dundas St Queen St King St SpadinaAve UniversityAve YongeSt ParliamentSt Bloor St Gardiner Expwy 1 5 6 4 2 710 11 3 8 9 Lake Ontario Historical Performance and Forecast (600,000) (400,000) (200,000) - 200,000 400,000 600,000 800,000 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 2009Q2 2009Q3 2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 Net Absorption (SF) New Supply (SF) Vacancy Rate (%) 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% -200,000 0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 1,600,000 1,800,000 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 20151Q 20152Q 20153Q 20154Q 20161Q 20162Q 20163Q
  5. 5. 5Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International Midtown The overall vacancy rate in the Midtown market remains almost unchanged from the previous quarter and sits at 2.7 percent. While the market didn’t see much movement, numerous leases and renewals took place in the Midtown market with companies such as the Toronto Transit Commission and EventMobi. The renewal activity within the Midtown market outlines the desire for companies to remain within this market. Trends >> Slate Properties purchased One St. Clair Avenue West this quarter for about $33.5 million. >> Demand by companies to locate within the Midtown market continues, as its public transit accessibility and proximity to the Downtown market continues to make this market attractive to office-leasing tenants. Summary Statistics Q3 2015 Regional Office Market Q2 2015 Q3 2015 Trend Office Inventory 19,387,861 19,387,861 Net Absorption 65,388 21,328 Vacancy Rate 2.8% 2.7% Availability Rate 6.8% 6.2% Average Asking Net Rent $18.48 $19.27 Notable Lease Notable Sale New Supply Upcoming New Supply ADDRESS CLASS FLOORS SIZE (SF) DEVELOPER COMPLETION STATUS 6. 135 Yorkville Avenue A 11 50,000 Camrost Felcorp Q3 2016 Planned Notable Sale Transactions PURCHASER - ADDRESS PRICE APPROXIMATE SIZE (SF) 3. Slate Properties Inc. - One St. Clair Avenue West $33,500,000 84,982 4. Slate Properties Inc. - 2323 Yonge Street $29,000,000 67,389 5. Fernhill Holdings Limited - 10 Alcorn Avenue $9,300,000 67,200 Bloor St Dundas St Queen St Eglinton Ave LansdowneAve YongeSt BayviewAve DufferinSt Lawrence Ave Gardiner Expwy TORONTO 5 4 2 3 6 7 1 Historical Performance and Forecast (600,000) (400,000) (200,000) - 200,000 400,000 600,000 800,000 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 2009Q2 2009Q3 2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 Net Absorption (SF) New Supply (SF) Vacancy Rate (%) 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% -20,000 -40,000 -60,000 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 20151Q 20152Q 20153Q 20154Q 20161Q 20162Q 20163Q Notable Lease Transactions TENANT NAME - ADDRESS TYPE APPROXIMATE SIZE (SF) 1. EventMobi - 175 Bloor East Sublease 19,807 2. Indeed Canada - 365 Bloor Street East Headlease 12,600 3. The Counselling Foundation - 2 St Clair Avenue East Headlease/ Sublease 10,739
  6. 6. 6 Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International Central North Slate Properties purchased 5075 Yonge Street, a $31 million transaction that is part of the $94 million Evton Capital Partners - Slate Properties Toronto Office Portfolio 2015, comprising two more office properties located in Midtown Toronto. Evton will be selling additional fund properties, confirming the strong selling activities we are seeing in the market. Net absorption has seen some improvement due to some small-size deals in the market, recording a positive absorption of 37,748 square feet in Q3 2015. Trends >> A mix of office buildings and office condos is active in the sale market, with an average of $510/SF for an office condo this quarter. >> The vacancy rate declined to 2.9% this quarter, down from 3.2% in Q2 2015. Summary Statistics Q3 2015 Regional Office Market Q2 2015 Q3 2015 Trend Office Inventory 12,026,988 11,987,488 Net Absorption (183,571) 37,748 Vacancy Rate 3.3% 2.9% Availability Rate 6.1% 5.9% Average Asking Net Rent $17.08 $17.23 Notable Lease Notable Sale New Supply Upcoming New Supply ADDRESS CLASS FLOORS SIZE (SF) DEVELOPER COMPLETION STATUS 6. 4800 Yonge Street A 25 393,000 Oxford Properties Group Q4 2016 Planned 7. 4050 Yonge Street A 7 367,000 Build Toronto Inc. Q4 2016 Planned Notable Lease Transactions TENANT NAME - ADDRESS TYPE APPROXIMATE SIZE (SF) 1. Toronto Transit Commission - 5 Park Home Avenue Headlease 23,150 2. Bluecat Networks - 10 York Mills Road Sublease 13,000 3. Recruiting In Motion Inc. - 2 Sheppard Avenue East Headlease 6,100 Sheppard Ave Highway 401 Lawrence Ave Finch Ave YongeSt BayviewAve KeeleSt Steeles Ave Eglinton Ave BathurstSt York University 7 TORONTO VAUGHAN 5 4 Lawrence Sheppard Finch Downsview Lawrence West Eglinton West Eglinton 1 2 3 6 Historical Performance and Forecast (600,000) (400,000) (200,000) - 200,000 400,000 600,000 800,000 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 2009Q2 2009Q3 2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 Net Absorption (SF) New Supply (SF) Vacancy Rate (%) 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% -100,000 -150,000 -200,000 -250,000 -50,000 0 50,000 100,000 150,000 200,000 250,000 300,000 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 20151Q 20152Q 20153Q 20154Q 20161Q 20162Q 20163Q Notable Sale Transactions PURCHASER - ADDRESS PRICE APPROXIMATE SIZE (SF) 4. Slate Properties Inc. - 5075 Yonge Street $31,000,000 86,529 5. Intrepid Yonge Group Inc - 5287 Yonge Street $2,575,000
  7. 7. 7Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International GTA North Engineering firms are still dominating the GTA North office market generally and Markham submarket specifically. They tend to stay and expand within the area, attracting more tenants of the same industry. With close to 1.5 million square feet of available office space, equivalent to 10 percent of availability rate, tenants looking in this market have many and diverse options. GTA North experienced positive absorption of 86,219 square feet this quarter with SCM Adjusters Canada and Mattamy Homes contributing to this positive absorption as they took 61,684 square feet at 175 Commerce Valley Drive West and 32,000 square feet at 7880 Keele Street, respectively. Trends >> 15 sale transactions were recorded this quarter, including Fiera Properties’ purchase of Liberty Centre for $111.5 million. >> The vacancy rate remained the same as last quarter, standing at 8.9%. Notable Lease Transactions TENANT NAME - ADDRESS TYPE APPROXIMATE SIZE (SF) 1. SCM Adjusters Canada - 175 Commerce Valley Drive West Headlease 61,684 2. Mattamy Homes - 7880 Keele Street Headlease 32,000 3. Longview Solutions Canada ULC - 65 Allstate Parkway Headlease 24,486 Summary Statistics Q3 2015 Regional Office Market Q2 2015 Q3 2015 Trend Office Inventory 14,624,545 14,581,553 Net Absorption (102,171) 86,219 Vacancy Rate 9.5% 8.9% Availability Rate 13.7% 10.0% Average Asking Net Rent $15.99 $15.99 Notable Lease Notable Sale New Supply Upcoming New Supply ADDRESS CLASS FLOORS SIZE (SF) DEVELOPER COMPLETION STATUS 7. Millway Rd. at Apple Mill Rd A 14 350,000 Calloway REIT, SmartCentres Q1 2016 Planned 8. 7777 Weston Road A 8 136,000 Liberty Developments Q3 2016 Planned 9. 2833 16th Avenue A 60 9,000,000 Cadillac Fairview Planned 10. 1555 16th Avenue 7 120,650 Investors Group Planned Newmarket Richmond Hill King City Highway 407 Aurora RdWellington St Highway404 YongeSt Stouffville Rd WardenAve Highway400 Steeles Ave King Rd Highway27 Davis Dr 9 VAUGHAN RICHMOND HILL AURORA 3 28 7 10 5 6 4 1 Historical Performance and Forecast (600,000) (400,000) (200,000) - 200,000 400,000 600,000 800,000 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 2009Q2 2009Q3 2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 Net Absorption (SF) New Supply (SF) Vacancy Rate (%) 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% -100,000 -150,000 -50,000 0 50,000 100,000 150,000 200,000 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 20151Q 20152Q 20153Q 20154Q 20161Q 20162Q 20163Q Notable Sale Transactions PURCHASER - ADDRESS PRICE APPROXIMATE SIZE (SF) 4. Financial Debt Recovery Limited - 100, 120 and 160 Commerce Valley Drive East $10,500,000 71,150 5. Metrus Properties - 33 Commerce Valley Drive East $10,000,000 125,000 6. Zzen Group - 7725 Jane Street $5,250,000 22,327
  8. 8. 8 Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International Central East The construction at Eglinton Crosstown LRT is progressing in the Central East market and it is spurring new developments along its route and in the vicinity. One of the proposed major developments is the Celestica 24-hectare lands located at the northwest corner of Don Mills Road and Eglinton Avenue East. The proposal, which offers a mixed-use development including residential, office and retail spaces, is still under the review and re-zoning process. The net absorption in the Central East market improved from -17,548 square feet in Q2 2015 to record a positive absorption this quarter at 40,299 square feet. Trends >> The vacancy rate has dropped from 5.5% in Q2 2015 to 4.7% in Q3 2015. Notable Lease Transactions TENANT NAME - ADDRESS TYPE APPROXIMATE SIZE (SF) 1. Collection Group of Canada CGC - 251-255 Consumers Road Headlease 27,000 2. Techtronic Industries Canada - 7303 Warden Avenue Headlease 18,182 3. Catastrophe Response Unit Inc. - 2001 Sheppard Avenue East Headlease 8,991 Summary Statistics Q3 2015 Regional Office Market Q2 2015 Q3 2015 Trend Office Inventory 18,259,041 18,259,041 Net Absorption (17,548) 40,299 Vacancy Rate 4.9% 4.7% Availability Rate 12.0% 12.0% Average Asking Net Rent $13.38 $12.74 Notable Lease Notable Sale New Supply Upcoming New Supply ADDRESS CLASS FLOORS SIZE (SF) DEVELOPER COMPLETION STATUS 7. 3377 Steeles Avenue East A 6 280,000 Bentall Real Estate Services Planned 8. 101 Gordon Baker Road A 12 250,000 Osmington Inc. Planned Notable Sale Transactions PURCHASER - ADDRESS PRICE APPROXIMATE SIZE (SF) 4. Trez Capital - York Mills Valley Centre $23,030,559 145,000 5. Bodhi Meditation - 130 - 180 Yorkland Boulevard $11,500,000 65,284 6. Logan Building Office & Services Inc. - 240 Logan Avenue $5,600,000 14,315 Highway 407 Eglinton Ave Finch Ave Highway404 YongeSt VictoriaParkAve KennedyAve Sheppard Ave Steeles Ave Highway 401 MarkhamRd KeeleSt 7 SCARBOROUGH TORONTO 8 Finch Kennedy Union Lake Ontario 2 3 1 5 6 4 Historical Performance and Forecast (600,000) (400,000) (200,000) - 200,000 400,000 600,000 800,000 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 2009Q2 2009Q3 2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 Net Absorption (SF) New Supply (SF) Vacancy Rate (%) 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% -100,000 -200,000 0 100,000 200,000 300,000 400,000 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 20151Q 20152Q 20153Q 20154Q 20161Q 20162Q 20163Q
  9. 9. 9Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International GTA East It has been a quiet quarter with minimal activities in the GTA East market, absorption dropped to -64,093 SF, most of this negative absorption took place in the A class buildings in both Scarborough and Pickering/Oshawa submarkets. Vacancy rate declined as well from 7.1% last quarter to 7.9% this quarter. A few small-size sale activities were recorded this quarter, ranging from $207 to $456 per square foot. Trends >> Average rental rates are still low and competitive at $11.41 per square foot. Summary Statistics Q3 2015 Regional Office Market Q2 2015 Q3 2015 Trend Office Inventory 7,406,240 7,406,240 Net Absorption (12,531) (64,093) Vacancy Rate 7.1% 7.9% Availability Rate 9.9% 14.0% Average Asking Net Rent $11.53 $11.41 Notable Lease Notable Sale New Supply Upcoming New Supply ADDRESS CLASS FLOORS SIZE (SF) DEVELOPER COMPLETION STATUS 1. 65 Bayly Street West 2 31,500 Medallion Corporation Q1 2016 Under Construction 2. 400 Consilium Place A 15 375,000 (up to 900,000 available in 3 towers) Kevric Corporation Planned Taunton Rd Kingston Rd Highway 407 BrockRd Sheppard Ave Steeles Ave Highway 40 York&DurhamLine Scarborough Town Centre Stouffville Pickering Osha Markham 1 2 TORONTO OSHAW PICKERING Lake Ontario Historical Performance and Forecast (600,000) (400,000) (200,000) - 200,000 400,000 600,000 800,000 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 2009Q2 2009Q3 2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 Net Absorption (SF) New Supply (SF) Vacancy Rate (%) 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% -100,000 -150,000 -50,000 0 50,000 100,000 150,000 200,000 250,000 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 20151Q 20152Q 20153Q 20154Q 20161Q 20162Q 20163Q
  10. 10. 10 Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International GTA West The GTA West office market experienced positive absorption this quarter, declining the market’s vacancy rate to 10.6 percent from 10.8 percent. PointClickCare and other tenants that inked deals in previous quarters have now occupied their new space within the third quarter, attributing to the positive absorption. PointClickCare occupied space at 5550 Explorer Drive – space vacated by Target Canada. The relative speed as to which this space was leased, combined with other large deal announcements in this quarter, displays demand for newly built Class A office space within the GTA West. Trends >> Desjardins recently renewed and expanded its office space at 1 and 3 Robert Speck Parkway. >> Larger companies in the financial services/banking industry have a high demand for office space within the GTA West. Notable Lease Transactions TENANT NAME - ADDRESS TYPE APPROXIMATE SIZE (SF) 1. Dejardins - 3 Robert Speck Parkway Renewal 190,000 2. Dejardins - 1 Robert Speck Parkway Expansion 60,000 3. JTI-Macdonald Corporation - 1 Robert Speck Parkway Renewal 30,441 Summary Statistics Q3 2015 Regional Office Market Q2 2015 Q3 2015 Trend Office Inventory 50,402,705 50,303,533 Net Absorption 405,918 83,779 Vacancy Rate 10.8% 10.6% Availability Rate 16.6% 15.1% Average Asking Net Rent $14.63 $14.33 Notable Lease Notable Sale New Supply Upcoming New Supply ADDRESS CLASS FLOORS SIZE (SF) DEVELOPER COMPLETION STATUS 6. 255 Longside Drive B 1 70,000 NC Warehouse Inc. Q3 2015 Under Construction 7. 2476 Argentia Road A 4 100,000 Sunlife Assurance Company of Canada Q3 2015 Under Construction 8. 1383 North Service Road East B 1 46,650 Carttera Private Equities Inc. Q3 2015 Under Construction 9. 1393 North Service Road East B 1 35,074 Carttera Private Equities Inc. Q3 2015 Under Construction 10. 2727 Meadowpine Boulevard A 7 200,000 Carttera Private Equities Inc. Q1 2016 Under Construction 11. 2201 Bristol Circle A 7 236,000 Westbury International (1991) Corporation Q1 2016 Under Construction 12. 610 Chartwell Road A 4 104,000 First Gulf Q3 2016 Under Construction Notable Sale Transactions PURCHASER - ADDRESS PRICE APPROXIMATE SIZE (SF) 4. The Regional Municipality of Peel - 7150 Mississauga Road $21,950,000 79,406 5. Community Trust - 2350 Matheson Boulevard East $8,570,000 40,000 Kipling Georgetown Milton Lake Ontario QEW Highway 407 Highway 403 hwy427 Highway10 Highway 401 7 TORONTO BRAMPTON OAKVILLE MISSISSAUGA 3 9 10 11 12 8 54 6 2 1 Historical Performance and Forecast (600,000) (400,000) (200,000) - 200,000 400,000 600,000 800,000 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 2009Q2 2009Q3 2009Q4 2010Q1 2010Q2 2010Q3 2010Q4 2011Q1 2011Q2 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 Net Absorption (SF) New Supply (SF) Vacancy Rate (%) 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% -200,000 -400,000 -600,000 0 200,000 400,000 600,000 800,000 1,000,000 2011Q3 2011Q4 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 20151Q 20152Q 20153Q 20154Q 20161Q 20162Q 20163Q
  11. 11. 11Research & Forecast Report | Q3 2015 | Greater Toronto Area / Office | Colliers International Glossary Weighted Average Asking Net Rent: The dollar amount requested by landlords for an available space, expressed as an average based on the weight of available space. Availability: The total amount of space that is currently being marketed as available for lease or sublease at the end of the quarter. It includes space that is available, regardless of whether the space is vacant or occupied. Net Absorption: The net absorption in available space in a given market between the current quarter and the previous quarter. Direct Availability: Space that is being offered for lease directly from the landlord or owner of a building, not space by another tenant in the building trying to sublet a space that has already been leased. Sublease Availability: Sublet space that is available for sublease by a tenant to another lessee for a term equal to or shorter than that held by the tenant under its original lease with the landlord. Under Construction: Buildings where actual ground breaking has occurred (site excavation or foundation poured) and construction is ongoing (not abandoned or discontinued) but for which a certificate of occupancy has not yet been issued. New Supply: Total square footage with completed construction, where all that remains is the installation of tenant finishes. Days on the Market (DOM): How many days an available industrial property has been on the market for. GTA Central: Includes East York, Etobicoke, North York, Scarborough, Toronto and York. GTA East: Includes Ajax, Oshawa, Pickering, and Whitby. GTA North: Includes Aurora, Markham, Newmarket, Richmond Hill, Vaughan and Whitchurch-Stouffville. GTA West: Includes Brampton, Burlington, Caledon, Milton, Mississauga and Oakville. GTA Southwest: Includes Hamilton and Stoney Creek. Forecast Assumptions & Terminology Absorption was calculated using moving averages of historical absorption data and supplemented with incoming new speculative and build-to-suit developments. Colliers International has adopted NAIOP’s terms and definitions which is reflected in this glossary and report.
  12. 12. Copyright © 2015 Colliers International. The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of the material contained in this report. About Colliers International Group Inc. Colliers International Group Inc. is a global leader in commercial real estate services, with more than 16,300 professionals operating out of 502 offices in 67 countries. Colliers International delivers a full range of services to real estate occupiers, owners and investors worldwide, including global corporate solutions, brokerage, property and asset management, hotel investment sales and consulting, valuation, consulting and appraisal services, mortgage banking and insightful research. In 2014 the firm handled $97 billion in total transaction value for 84,600 leases and sales. Colliers manages more than 1.7 billion square feet of commercial properties. Colliers International Group Inc. generates more than US$2.3 billion in annual revenues. With significant insider ownership and an experienced management team, Colliers International has a long-term track record of creating value and superior returns for shareholders – previously under the ownership of FirstService, and as of June 2015, continuously as an independently owned company. The common shares of Colliers International Group Inc. trade on the NASDAQ under the symbol “CIGI” and on the Toronto Stock Exchange under the symbol “CIG”. collierscanada.com 502 offices in 67 countries on 6 continents United States: 140 Canada: 31 Latin America: 24 Asia Pacific: 199 EMEA: 108 $2.3 billion in annual revenue 1.7 billion square feet under management 16,300 professionals and staff MARKET CONTACT: John Arnoldi Executive Managing Director | Toronto Brokerage DIRECT: +1 416 643 3733 john.arnoldi@colliers.com REGIONAL AUTHORS: Kimberlee West Market Intelligence Team Leader | Toronto +1 416 643 3776 kimberlee.west@colliers.com Shawn Gilligan Market Intelligence Coordinator | Toronto DIRECT: +1 (416) 607 4325 shawn.gilligan@colliers.com Norhan Mansour Market Intelligence Coordinator | Toronto DIRECT: +1 (416) 791 7264 norhan.mansour@colliers.com Colliers International | Toronto One Queen Street East, Suite 2200 Toronto, ON | Canada +1 416 777 2200

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