by Paolo Taruc
The Toronto Real Estate Board has logged a 22% drop in combined industrial, commercial/retail and office space leased last October from the same month in 2016.
According to figures from its Multiple Leasing Service (MLS) system, its commercial network members managed to lease 263,420 sq. ft. of such spaces last month. Industrial lease transactions lead the way, but the same sector saw the biggest annualized drop in leased area (-43%). Meanwhile, leased office space more than doubled (128%) to 57,243 sq. ft. last month from 25,010 sq. ft. in October 2016.
Changes in average lease rates, for space transacted on a per square foot net basis with pricing disclosed, was mixed depending on market segment. The average industrial lease rate in October 2017 was $8.27 per square foot net – up from $7.02 in October 2016. The average commercial/retail lease rate remained similar on a year-over-year basis, at $21.55 in October 2017 versus $22.41 a year earlier. The average office lease rate was up to $17.51, compared to $13.81 a year earlier. According to TREB, average lease rates can change based on shifts in market conditions and changes in the mix of properties leased, in terms of type, size and location.
“[F]rom a longer term perspective, the GTA (Greater Toronto Area) and broader Greater Golden Horseshoe remains very competitive in the North American and global contexts,” said TREB president Tim Syrianos. “While Canadian economic growth appears to have slowed in the second half of 2017, Canada is still on track to pace growth in G7 countries. This points to a solid foundation for the demand for industrial, commercial/retail and office space in the region.”
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