It’s a Canadian co-working revolution, and it’s transforming the business landscape. According to the latest stats from CBRE Canada’s Canadian Flexible Real Estate Report, flexible office companies have expanded their office leasing footprint by 303% in just five years, growing from 1.5 million sq.ft. in 2014 to 6.1 million sq.ft. in 2019.
“We haven’t seen a new type of office tenant emerge with such speed and dominance since the dot-com boom,” says CBRE Canada Vice Chairman Paul Morassutti. “The rise of flexible office operators reflects the pace at which work and the workplace are evolving along with new technology, changing demographics, and an overall push for innovation. This has led to the birth, adoption and replication of agile real estate strategies at a remarkable pace.”
Flexible office solutions (aka ‘co-working environments’) are defined as workspaces wherein freelancers, entrepreneurs, remote workers, and small teams from varying organizations share the same environment and amenities. Operators of such spaces accounted for four of the ten largest office deals nationally in the first half of 2019 alone. They have also driven down vacancies in major urban centres such as Toronto, where flexible real estate operators now occupy 3.1 million sq. ft. of available office space (1.8% of the total stock); Metro Vancouver, where flexible real estate represents 1.7 million sq.ft. of office space (3.3%); and Montreal, where co-working environments account for 959,000 sq. ft. of leasable office space (1.2%).
“Flexible real estate is taking off across Canada, and it’s not hard to see the appeal for office occupiers and owners,” says Morassutti. “Occupiers are able to deliver high-performing workplaces to their employees and ensure their portfolio can adapt to the changing needs of the organization. And office building owners and investors can utilize flexible solutions to modernize and future-proof their assets by incorporating new and innovative building features, maximizing returns in the long run.”
Toronto, Vancouver, and Montreal may host the lion’s share of flexible office space, but the trend is picking up in jurisdictions across the country. Read CBRE’s full report for the latest stats on this growing real estate trend.