Canada’s office sublet market – turning the corner?
June 8, 2021
In a prior blog in mid-May 2020, I mentioned that economic downturns are often a harbinger of a burgeoning sublet market in the commercial real estate sector.
During this hiatus from the physical office and ongoing debate as to what the post-pandemic workplace will look like, companies of all sizes and industry types have indeed flooded the market with millions of square feet of sublease space – some the result of direct or indirect financial hardship, others the result of weighing the options of a hybrid work environment.
Now, some 15 months into the pandemic, there is a sense of optimism that Canada is poised to recover strongly once vaccinations reach a critical mass – leading to a widespread reopening of many offices in fall 2021 or early 2022.
I want to put the current sublet market into perspective, relative to prior downturns.
Notwithstanding the sharp increase during the pandemic, it appears the national sublet pipeline might be starting to turn the corner. The comparison with prior downturns leads to some interesting questions, and lately, we have heard anecdotally that some occupiers have withdrawn sublet space from the market, in part or altogether.