Available Toronto office space has quadrupled in 2020 as work-from-home continues
Most people who used to work in Toronto offices have been relegated to a sad couch and laptop setup at home this year thanks to the health crisis, and with businesses unsure of when it may be safe to head back into communal work settings, many have gotten rid of their workplaces altogether.
Prominent e-commerce giant Shopify, for example, decided most of its employees will move to remote work permanently, and that its offices in Toronto and Ottawa will remain shuttered until sometime next year.
Meanwhile, retailers in the PATH, which is normally a bustling hub of suits from the adjoining office towers, have been suffering and closing down for good now that the underground network and the financial district around it has become a ghost town.
Even the City itself has cut down on its office space, with a planned reduction of 33 per cent of its office floor space — down from 55 locations to only 15 — and only five per cent of staffers saying that they expect to return in-person full-time.
With so many businesses vacating their premises, there is a glut of subleased office space now on the market — around a staggering 2.5 million square feet, in fact, a number that is almost four times what was up for grabs pre-COVID. In the GTA as a whole, an approximate 5.1 million square feet now lies empty and up for sublease.
And, it's a trend that continues to accelerate many months after the pandemic's onset, according to the numbers provided by experts, who don't predict the levels will return to normal for years, even if there is eventually high demand once more.
"Downtown, a decline in sublet available space of 159,000 sf per quarter would be needed — double the fastest rate recorded in any peak-to-valley period during the last 20 years," writes global commercial real estate firm Avison Young principal Bill Argeropoulos in a post on the subject.
"Clearly, significant pent-up demand would be required, especially given the amount of new office space that will be delivered downtown between now and 2024."
He also predicts that pricing for office space will inevitably drop as a result, as residential rents in the city have.
The fate of coworking spaces also remains up in the air, as they ostensibly have similar potential risks as a regular office (though they've all employed new health and safety measures), but also provide people the benefit of working from home with a sense of routine and an excuse to leave the house and interact with others.
Some expect that the number of coworking spaces in major cities internationally will be on the rise in the near future, while others are more proponents of innovative new concepts like apartment coworking concepts.
With many traditional offices in Toronto now shut, hundreds of restaurants and bars permanently closing, and the city potentially looking at another spate of grey-level lockdown, no wonder people are actually moving out of the city now that they don't have an office or other attractions to go to.
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