CREblurb | Commercial Real-Estate in Ontario

London’s Downtown Attracts Innovative Companies

London’s Downtown Attracts Innovative Companies

London’s Downtown Attracts Innovative Companies
July 19
09:21 2016

Overall the news is good for those looking to invest in London’s core according to the most recent market analysis as well as local real estate experts. According to a CBRE Research, the Core (Office) Market consists of 4,409,750 sq. ft. of inventory and is bordered by Oxford Street East, Adelaide Street North, York Street, and the Thames River. Lease renewals and the tech sector are leading the way.

The report notes that “vacancy rate in London’s office market in Q4 2015 was 14.3%, a decrease of 20 basis points (bps) compared to Q3 2015.Year-over-year, the market has experienced a decrease of 90 bps from 15.2% vacancy rate recorded in Q4 2014.”

Peter Whatmore, Senior Vice President Southwestern Ontario with CBRE, notes “It’s certainly an indicator ofstability. Infrastructure Ontario and RBC Dominion Securities Inc. both renewed lease agreements totalling108,721 sq. ft. Lease renewals are quite common and most of the activity we’re seeing is strong and a condition of companies working to stay in the core where they’ve been successful.”

Charlie Gobert, Vice President and Sales Representative with Avison Young, oversees leasing of Citi Plaza where signs are positive.

“We’ve seen our vacancy rates drop – we have a digital gaming company expand by an additional 10,000 sq. ft. to 42,000 sq. ft. and, Intact Insurance have expanded by about 6,400 sq. ft. to just above 42,000 sq. ft. Anotherrecent completion is PricewaterhouseCoopers (PwC) for their Service Delivery Centre (SDC) providing tax return preparation and other compliance services which is new to Canada and they service all of Canada from this location. As an example we’ve recently done 22,200 sq. ft. of expansion renewals and nearly 138,000 sq. ft. including new and or expansions on the office side.”The tech sector is also drawing companies and people to the Downtown London.

“These bright, young workers want that urban experience and the amenities are going to follow as the numbers of those employed in the core increases,” says Whatmore.“The question will be how much growth will technology bring as banks and finance decreases. It’s a good news story and it’s simply a shift. There are 1,000 more people working in the tech sector over last year and most of that is in the core.”

The tech sector has broad based support throughout the core according to Gobert, who “in meeting with the London Economic Development Corporation (LEDC) we have learned more in identifying good quality, fun spaces that these companies are looking for,” adding, “You are also seeing organizations like Fanshawe College moving from leasing to owning.”

As for recommendations to investors, “We like downtown London a lot,” says Whatmore.“The market is improving and we believe 2016 is going to see a continuance of lower vacancy rates – it’s coming down modestly but it is coming down.”


For more information about this article please contact us below

About Author

creblurb

creblurb

Related Articles