What’s the definition of confidence in Saskatoon?
Spending hundreds of millions of dollars on construction and renovations of office buildings when the office vacancy rate is 16 per cent, second highest in Western Canada.
Despite the apparent glut – and worries of a labour shortage – the 155,000-square-foot east tower of the River Landing project in Saskatoon is coming out of the ground, the 125,000-square-foot World Trade Centre is scheduled to do the same in the spring and the old Saskatoon police station is being overhauled to house office tenants.
It’s all happening within a few blocks of each other.
“You could say our vacancy rate is high but with three projects on the go in the downtown, the developers are confident enough to go ahead,” said Josh Walchuk, senior sales associate and partner at ICR Commercial Real Estate in Saskatoon.
National and international tenants will likely fill the new space, Walchuk said.
Saskatoon’s office vacancy rate in Class A space is just 5 per cent; the majority of empty space downtown is in Class B and C buildings.
“The older buildings are going to have to spend some money to be relevant again. They’ve got to step it up in some way,” he said.
One misconception that Walchuk wanted to clear up was that now is a good time for construction because the trades are slow. On the contrary, with 19 schools being built in the province, trades of all kinds are very busy.
In fact, he believes some tradespeople will come from outside the province for the work.
“There will be lots of competition,” he said.