{"id":1024,"date":"2014-05-17T00:24:00","date_gmt":"2014-05-17T00:24:00","guid":{"rendered":"http:\/\/rf.podcastfixit.com\/index.php\/2014\/05\/17\/tenants-rule-as-space-abounds-in\/"},"modified":"2015-06-01T19:41:08","modified_gmt":"2015-06-01T19:41:08","slug":"tenants-rule-as-space-abounds-in","status":"publish","type":"post","link":"https:\/\/newscoverage.org\/index.php\/2014\/05\/17\/tenants-rule-as-space-abounds-in\/","title":{"rendered":"Tenants rule as space abounds in downtown core"},"content":{"rendered":"

By Robert Frank<\/b>
www.sqft.ca<\/a><\/p>\n

A perfect storm is converging in downtown Montreal, just as ample new office space is about ready for delivery.<\/p>\n

\u201cWe face a softening market and an abundance of sublease\u2014or gray market\u2014space,\u201d said Lloyd Cooper. \u201cWe\u2019re not tracking close to 800,000 sq.ft. of sublet space, market-wide. So there is fear out there.\u201d<\/p>\n

\u201cWith hundreds of thousands of square feet of pending inventory to hit the market 2015-2017, coupled with the Heenan Blakie meltdown, Montreal has become very much a tenants\u2019 market,\u201d concluded the Cushman & Wakefield vice-president. \u201cCoupled with the slow economy and political pressure, this has put landlords on edge.\u201d<\/p>\n

Meantime, a parade of players\u2014big and small\u2014are marching out of the city centre.<\/p>\n

\u201cMidtown is taking tenants out of the downtown core who don\u2019t need to be there,\u201d Cooper underscored. \u201cTenants have already committed to more than 300,000 sq.ft. of space.\u201d<\/p>\n

\u201cThey\u2019re cutting their gross rental rate in half, without accounting for paying half price on parking,\u201d he said, \u201cand still offering tenants proximity to public transit because they\u2019re near the Metro and light rail.\u201d<\/p>\n

\u201cMajor firms like TD Bank, Royal Bank have committed to relocating their back office operations to refurbished garment manufacturing buildings,\u201d Cooper said. \u201cLikewise, even more small companies like Media Experts are trailblazing, moving there to save money.\u201d<\/p>\n

\u201cThey\u2019re getting live-work-play joie de vivre<\/i> because employees live in those areas: Mile End, Park Extension and Villeray,\u201d he added. \u201cThat just puts more pressure on the downtown core.\u201d<\/p>\n

The dynamic could make it costly for owners of second-tier properties to remain in the game.<\/p>\n

\u201cOwners of B properties are under pressure to upgrade,\u201d Cooper observed. \u201cThe new towers that are about to be delivered are LEED platinum and gold. So B-class owners have to invest in bringing their product up to date with new elevator systems, upgraded lobbies and toilets and base building components\u2014without necessarily getting greater return on their investment.\u201d<\/p>\n

\u201cThey\u2019re just treading water to maintain their occupancy rate,\u201d he concluded.<\/p>\n

\n
<\/i><\/div>\n
\nNote: This report appeared on page 30 of the Spring 2014 <\/a>issue of Canadian Real Estate Magazine.<\/i><\/div>\n
\n<\/div>\n","protected":false},"excerpt":{"rendered":"

By Robert Frankwww.sqft.ca A perfect storm is converging in downtown Montreal, just as ample new office space is about ready for delivery. \u201cWe face a softening market and an abundance of sublease\u2014or gray market\u2014space,\u201d said Lloyd Cooper. \u201cWe\u2019re not tracking close to 800,000 sq.ft. of sublet space, market-wide. So there is fear out there.\u201d \u201cWith<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1024","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"\nTenants rule as space abounds in downtown core - Newscoverage<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/newscoverage.org\/index.php\/2014\/05\/17\/tenants-rule-as-space-abounds-in\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Tenants rule as space abounds in downtown core - Newscoverage\" \/>\n<meta property=\"og:description\" content=\"By Robert Frankwww.sqft.ca A perfect storm is converging in downtown Montreal, just as ample new office space is about ready for delivery. \u201cWe face a softening market and an abundance of sublease\u2014or gray market\u2014space,\u201d said Lloyd Cooper. \u201cWe\u2019re not tracking close to 800,000 sq.ft. of sublet space, market-wide. 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