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Toronto, Montreal, Calgary and Vancouver feeling the effects of the real estate boom
Toronto, June 25, 2014 – Canada's commercial real estate boom has led to an increasing number of office deliveries in Canada's quartet cities, which include Toronto, Montreal, Calgary and Vancouver. According to JLL's (NYSE:JLL) annual research Look Forward series, many tenants will be leaving large blocks of space behind for those developments, which are already substantially pre-leased.
In Vancouver – a market receiving 16 percent more Class A inventory by 2017 – planned office developments are currently 60 percent pre-leased. In Canada's largest business district, Toronto, seven developments will bring an additional five million square feet to Downtown, increasing overall office supply to 75 million square feet.
"As more and more offices are added to the various markets across Canada, we are going to see significant changes from both tenants and landlords," said Brett Miller, President of JLL Canada. "With large tenants pre-leasing considerable amounts of space in new buildings, they will be leaving large blocks of space behind, opening the door for new tenants to move in. We are likely to see an increase in landlord incentives in an attempt to appeal to the limited number of tenants who are looking to make a move into the mature office towers."
The trend continues in markets like Calgary, which features six buildings moving forward with development, where 4.9 million square feet will be delivered to market by 2018.Effects of the Office Boom & the Changing WorkspaceMany of the buildings in development offer more than a prestigious new space. This new generation of Canadian commercial real estate is tailored to the emerging workplace, with large windows, open concept design, access to amenities and LEED® gold/platinum certifications. They appeal to large tenants looking to retain and attract employees.
"Large companies are taking steps to create spaces that will appeal to the greatest number of employees", said Miller. "As the next generation moves into the workforce, we are seeing a shift away from the traditional cubicle towards open layouts that foster collaboration and teamwork, and are conveniently located near amenities and transit."
The densification of the work place plays a key role as tenants aim to consolidate and reduce their footprints, a trend which has been fuelled by the changing work space. New developments are reflecting the changing needs of tenants by moving to open concepts to accommodate an increasing number of organizations moving from closed to shared spaces
As a way to attract millennials, many companies are seeking to stay at the forefront of trends. The majority of new developments have achieved sleek, modern designs, excellent public transit access and environmental sustainability. This are the values held by the next generations of workers. This shift has achieved a new prestigious and attractive identity for the millennials; separate than the identity established by the traditional bank towers for the Boomer generation. Look Forward - Market Highlights:Downtown Montreal:
JLL is Canada's fastest growing commercial real estate firm. JLL has two offices in Toronto, with the headquarters located downtown. The firm also operates in, Mississauga, Montreal, Ottawa, Vancouver, Calgary and Edmonton. JLL manages over 50 million square feet of facilities across Canada. The firm offers tenant and landlord representation, project and development services, investment sales, advisory and appraisal services, debt capital markets, and integrated facilities management services to owners and tenants in Canada.
About JLLJLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual fee revenue of $4 billion, JLL has more than 200 corporate offices and operates in 75 countries worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 3 billion square feet and completed $99 billion in sales, acquisitions and finance transactions in 2013. Its investment management business, LaSalle Investment Management, has $48.0 billion of real estate assets under management. JLL is the brand name of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com.
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