Ottawa’s downtown office vacancy rate is expected to rise due to a number of new developments nearing completion, according a new report from Newmark Knight Frank Devencore.

The Real Estate Market Study reveals that Class A, B and C offices in the greater downtown Ottawa market have a 4.7 per cent vacancy rate. Comparatively, downtown Class A and B offices have an availability rate — which includes space that is currently occupied but will soon be vacated — near the seven per cent rate.

Two major office developments are currently underway, which will add almost one million square feet of inventory to the market. Morguard’s Performance Court at 150 Elgin St. will have an initial delivery of space in January 2014. Public Works and Government Services Canada’s redevelopment of the Lorne Building at 90 Elgin St. is also underway. These developments are expected to contribute to a significant increase in Class A vacancy rates over the next 18 months.

The Class A and Class B markets in Kanata and Ottawa’s west-end submarket have a combined vacancy rate of 13.4 per cent. In this area, acquisition and consolidation events are having a significant impact on office supply. An example of this is BlackBerry, which in the last year has completed a new building and is in the process of shedding space at other locations.

In the rest of Canada, Class A and Class B vacancy rates have seen a slight increase, from 4.5 per cent to 4.9 per cent. While this reflects a relatively flat economy, the study notes that the country’s total inventory of built office space has increased from 207.7 million square feet in mid-2011 to 210.9 million square feet today.