It’s a good time to be an office tenant in downtown Regina.
“There are deals to be had,” said Duncan Mayer, Saskatoon-based research manager at Colliers International. “Landlords are reducing rates. It’s the only thing they can do.”
They’re also dangling carrots such as $20-per-square-foot tenant improvement rebates to help offset some of the outfitting costs.
According to the latest National Dashboard report from Colliers on cities with populations of less than one million, Regina’s downtown office vacancy improved slightly in the first three months of the year, falling to 11.3 per cent, down from 13 per cent in 2016.
It’s a far cry from the halcyon days of just a few years ago when Regina had the lowest vacancy rate in North America for five years running at 1 per cent, enabling landlords to charge “significant” rents, Mayer said.
A combination of additional inventory hitting the market over the last couple of years at the same time the provincial government, the biggest employer in the provincial capital, was scaling back was the biggest factor in the vacancy rate heading upwards.
The increased competitiveness of downtown landlords is trickling out to the suburbs, where vacancy rates have risen to their highest levels in recent memory.
Regina is also a unique market in that civic leaders maintain tight controls over suburban development. For example, if the vacancy rate downtown is more than 6 per cent, developers are forbidden from building office space in the suburbs.