Regina's rock-bottom office vacancy rate may rise this year due to a rush of new construction.
After completing a record 250,000 square feet of new office space in downtown Regina last year, developers are expected to add another 120,000 square feet of space in 2013 - or more than twice the annual construction pace over the previous decade.
Despite the robust building, Regina posted the lowest office vacancy rate in Canada until recently, according to Colliers International, at 1.92 per cent at the end of last year when a record 195,000 square feet was leased up.
The downtown vacancy has changed big time, however. As of the first quarter of 2013 it had shot up to 6 per cent, the highest level since 2004.
Colliers' research manager Duncan Mayar said the amount of new space coming to the market "may increase the vacancy rate in the short term, but we expect strong market absorption will keep the vacancy rate stable."
He also expects vacancy rates to be in the 5 per cent range through 2014.
Class A office lease rates in Regina are ranging from $23 per square foot for existing space and up to $35 per square foot for new space, according to Colliers.
from Western Investor September 2013
