Canada Feeling The Real Estate Crisis

April 26, 2009
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Commercial Real Estate

It is not only the United States that’s feeling the real estate and economic crunch. Even Canada is beginning to experience the effects of the economic recession in terms of an increase in the number of available properties and sublet space in major cities. Colliers International attributed Canada’s real estate problems to the recent job losses and economic slowdown.

Canadian firms are starting to reorganize their business operations by reducing the number of leased space that was earmarked for future growth and expansion. The companies are hoping to endure the financial crisis by giving up extra commercial space to the detriment of the commercial real estate sector.

At least 19.5% f the total vacant office space across Canada comprised of sublet space. At the same time the country saw a 5.9% increase in the vacancy rates for suburban and downtown markets. The market now has an influx of sublease space considering that majority of the tenants in the downtown area of Calgary are companies involved in the oil and gas industries which have been greatly affected by the crisis.

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