Reading said that while some tenants will eventually ramp up their in-office operations, the hybrid and remote working models are more likely to remain.
This trend will mark a significant departure from prior weak periods for the sector, in which lower rents and high vacancy rates were followed by “strong rebounds” amid a continuous stabilization in the economy.
Reading projected that the recovery in the office sector will be nowhere near as fast or as robust as the expected economic resurgence in the second half of 2024.
While hybrid work gains ground, Canada’s office market is far from fading. Companies are reimagining the office’s purpose – Marie-France Benoit tells @CMPmagazine tech advances had begun to transform workplace culture well before COVID-19: https://t.co/LjNXwndkND #AYdifference
— Avison Young | Canada (@AY_Canada) October 18, 2023
In 2024, the market’s likely focus will be on the “flight to quality” that will see accelerated demand for Class A buildings, which boast of modernity and prime locations compared to Class B and C structures, Reading said.
“What we have seen recently is that a lot of companies also have taken the opportunity to move up the quality ladder,” he added.