MONTRÉAL - In its Real Estate Market Study published today, Newmark Knight Frank Devencore reported that vacancy rates in downtown Montreal's Class "A" and "B" office buildings have risen slightly over the past six months from 6.0% to 6.8%, which represents a negative space absorption of just over 400,000 square feet. Currently, 3.2 million square feet of Class "A" and Class "B" office space is available for lease or sublet.
"While vacancy rates in the corporate sector are creeping up in downtown Montreal, real estate activity continues to take place at a pace we haven't seen for many years," said Jean Laurin, President and CEO of Newmark Knight Frank Devencore. "There are a number of new projects currently being developed, and other projects that are either about to begin construction or are in the pre-leasing stage. In addition, a number of areas are being redeveloped. In Griffintown, for example, there is a good deal of rejuvenation taking place in both the commercial and residential sectors. Other parts of the city with condo, retail and commercial projects include the area surrounding the Bell Centre; the Mile End, Jean Talon and Avenue du Parc neighbourhoods; and the Quartier des Spectacles development. As the revitalization projects proceed, these neighbourhoods will become more attractive to landlords and developers, as they offer prime real estate in close proximity to the downtown core."
Mr. Laurin also noted that the investment and construction activity will significantly change the face of the downtown business district as well as the bordering areas over the next few years. "The new developments being built and planned, as well as the rejuvenation projects that are transforming what were once industrial zones into neighbourhoods that artfully combine condo, office and retail developments, are providing tenants with more leasing opportunities, and more negotiating leverage, than they have enjoyed in a number of years," he said.
In Canada's major cities, the combined Class "A" and Class "B" vacancy rate edged up from 4.5% to 5.9% in 2013. However, construction activity remains strong across the country and new towers are being built in virtually every city. The appetite for this premium space also remains strong. In most instances, space in the new towers, most of which are LEED-certified, is being fairly rapidly leased.
About Newmark Knight Frank Devencore
As part of Newmark Grubb Knight Frank, one of the world's leading commercial real estate advisory firms, Newmark Knight Frank Devencore is Canada's largest corporate real estate advisor and brokerage, exclusively representing corporate, industrial and retail space users. With offices across the country, Newmark Knight Frank Devencore offers its global clientele comprehensive services that are individually designed to ensure executive real estate decisions are supported by effective strategies and professional execution. To learn more about our capabilities, please visit www.devencorenkf.com.
About Newmark Grubb Knight Frank
Newmark Grubb Knight Frank is one of the world's leading commercial real estate advisory firms. Together with London-based partner Knight Frank and independently-owned offices, NGKF's 12,000 professionals operate from more than 320 offices in established and emerging property markets on five continents.
With roots dating back to 1929, NGKF's strong foundation makes it one of the most trusted names in commercial real estate. NGKF's full-service platform comprises BGC's real estate services segment, offering commercial real estate tenants, landlords, investors and developers a wide range of services including leasing; capital markets services, including investment sales, debt placement, appraisal, and valuation services; commercial mortgage brokerage services; as well as corporate advisory services, consulting, project and development management, and property and corporate facilities management services. For further information, visit www.ngkf.com.
NGKF is a part of BGC Partners, Inc. (NASDAQ: BGCP), a leading global brokerage company primarily servicing the wholesale financial and real estate markets. For further information, visit www.ngkf.com.
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