Vacancy rate for Canadian offices reaches highest level since 1994

A new report by commercial real estate giant CBRE Group has revealed that office buildings in Canadian cities reached a vacancy rate not seen since 1994 in the third quarter of 2021, with a national average of 15.7 percent. The COVID-19 pandemic, they say, has caused higher vacancy levels than the "dot-com bubble and the global financial crisis."

According to CBRE Group, Calgary has the highest vacancy rate at 30.1 percent, while Vancouver has the most office space in use, with only 7.4 percent going unoccupied.

Industrial real estate, on the other hand, is booming. "Demand for distribution and logistics warehouses," CBRE Group states, "remains at an all-time high."

While working remotely is not a new phenomenon, the pandemic forced people out of their offices at an unprecedented rate. As society begins to open up, however, many are wondering whether working from home will remain the default option for those in sectors where physical presence in a particular location is not necessary.

The "hybrid model" has been championed by those who claim that while the majority of work can be done remotely, physical presence at the office serves an important role as well.

As the CBRE report details, most major employers are working hard to get employees back to the office in some capacity via implementing safety measures such as vaccine mandates. The tech sector, they explain, has lowered the vacancy rate in 4 out of the 10 Canadian cities measured in the report this quarter.

The COVID-19 pandemic has changed the very nature of work, and whether society will return to the 9-5 office days of yesteryear remains to be seen.