Significant investment in new energy technology will also have a marked impact on the Calgary market, according to Avison Young
Calgary’s office real estate market will likely benefit from an influx of new residents amid a record-setting year of migration to Alberta, according to Avison Young.
The province has seen approximately 184,400 new arrivals so far this year – a trend that will almost certainly supercharge demand for every asset class.
“Job postings have risen sharply, many with ‘in-person’ requirements,” Avison Young said. “While Calgary's office market is distinctively driven by the energy sector, many adjacent industries, such as engineering firms and the tech sector will also benefit from the injection of new talent to the labour pool.”
During the third quarter, the region saw positive absorption of 34,019 square feet of office space, which brought year-to-date absorption to 40,951 sf. Downtown vacancy levels fell slightly to 27.2% in Q3.
Avison Young said that significant investment in clean energy technology, in particular, will have a marked impact on the Calgary market.
“The distinction between tech and energy is becoming more arbitrary in Calgary,” Avison Young said. “These local factors continue to shape a unique trajectory for the city's office market, positioning it for growth and transformation in the coming years.”
While hybrid work gains ground, Canada's office market is far from fading. Companies are reimagining the office's purpose - Marie-France Benoit tells @CMPmagazine tech advances had begun to transform workplace culture well before COVID-19: https://t.co/LjNXwndkND #AYdifference— Avison Young | Canada (@AY_Canada) October 18, 2023
Highly sought-after AA spaces also continued to see tight competition.
“Turnkey spaces [have been] challenging to find,” Avison Young said. “Many occupiers are deciding that staying put and paying higher rent is still the cheaper option compared to moving.”
These developments indicate a market well-positioned to take advantage of its tailwinds, the report concluded.
“Overall, these Q3 results signal a positive step forward for Calgary's office market, marked by increased absorption rates across various submarkets,” Avison Young said. “While challenges persist, macro-economic forces continue to work in Calgary’s favour.”