A Colliers International Research Report show a growing demand towards “Office Condos” among business owners in the City of Toronto and Metro Vancouver, as they discover that owning your office space can be more affordable than leasing.
With the rise in investment condominiums continues in Vancouver and Toronto there has been increasing pressure on the leasing market. Availability of commercial property in the two cities continues to dwindle to the point where leasing has become more expensive than ownership. As an example pulled from Collier’s own research an annual lease of $35 for square foot is about $3 more per square foot than a 25-year mortgage on a unit selling for $700 per square foot. This assumes a 3 per cent mortgage with 20 per cent down amortized over 25 years.
While healthy and booming markets in Toronto and Vancouver can enjoy some savings through these means there is also opportunity in our province. Large companies under financial pressure and finding it increasingly difficult to fill leasing vacancies and are turning to divesting themselves of certain spaces.