Calgary’s suburban office market saw its vacancy rate increase by 1.2 per cent in the first quarter of the year to reach a record 24.1 per cent, according to a report by commercial real estate firm CBRE.
It also experienced negative absorption of 240,000 square feet.
“Now that the market has had a full year to adjust to the changes imposed by the global pandemic, we can start to draw some conclusions; remote work is here to stay and the need for physical space will decrease, but not disappear,” said CBRE.
“Many companies, who shifted to work from home one year ago, have now had an opportunity to analyze how their work force has adapted. The consensus so far is, despite productivity appearing to have been more resilient than expected, culture, collaboration, and engagement have been significantly affected. The office plays a vital role in representing a company’s brand and culture, facilitating employee connectivity while providing a competitive edge for engaging, and attracting new talent.
“Although many employees have reacted positively to working from home, senior executives recognize the importance of maintaining a physical space. As a result, many organizations have already adopted a hybrid model of working from home and at the office.”
The report said the need for space is expected to decrease with the integration of hybrid models into long-term planning.
“As a result, more space is being returned to the market – a trend we may continue to see over the next few quarters,” said CBRE.