Premium office gets vote of confidence from major firms, 2025 to present significant challenges
Office-using employment in Toronto continued its growth trajectory during the fourth quarter, at an average rate of 6% each month. Strengthening office-using employment growth was observed throughout 2024, while return-to-office (RTO) picked up steam. While RTO has boosted office demand, there is a high degree of economic uncertainty for Canada going into the new year. The depreciating Canadian dollar, threat of U.S tariffs, a federal election year, persistent inflation concerns, and cost-of-living challenges will be key pressure areas for both employers and employees. The recent interest rate cuts by the Bank of Canada could spur new development for AAA office buildings, as prime vacancy continues to tighten across the board.