Canada Office National Report

Space needs yet to meaningfully turn corner as job market softens. During the first four months of 2024, Canada’s total employment increased at a solid pace. However, the pace of job growth has eased in the office-using sectors, indicating that elevated interest rates continue to exert pressure on hiring activity. Consistent with the labour market dynamics, demand for office space has remained weak. On the national level, net absorption has lagged behind new construction for nine consecutive quarters, pushing the vacancy rate to a record high in the first three months of 2024. As remote work arrangements continue to impact office utilization, coupled with still elevated interest rates, office demand will likely continue to remain weak, resulting in a record-high vacancy rate by the end of this year.