Calgary office vacancy rate falling, no new builds: report

A stock photo of a person working in an office. (Unsplash.com/proxyclick)

Fewer Calgary offices are sitting empty than in the past two years, according to a new report from commercial real estate services and investment firm CBRE Canada.

CBRE’s Q1 Canada Office Figures, released on Tuesday, show Calgary’s office vacancy rate is sitting at 28 per cent, down from a record high of 33.7 per cent in 2022.

Calgary still has the highest downtown office vacancy rate in the country at 30 per cent, compared to 18 per cent nationally, but the influx of people to Alberta shows promise for change according to Greg Kwong, CBRE Alberta regional managing director.

CBRE says the data suggests no office projects broke ground at the beginning of 2024, a first in many years, giving office markets a chance to catch their breath after a tumultuous post-pandemic period.

Calgary did get new space finished this quarter, and when Uxborough Medical came to the market it was 60 per cent pre-leased.

High construction costs and fewer move-in-ready spaces have created challenges for Calgarytenants wanting to relocate, according to the report.

Multi-floor tenants looking to move are especially limited, with few options available in Calgary over 50,000 sq. ft. 

Converting former offices into residential units is part of the solution, but a small piece.

Kwong said getting people back to working from their offices more days a week and companies hiring more staff would make the biggest difference. 

He said the energy sector continues to take up the vast majority of office space.