Saskatoon’s commercial real estate market continues to hold strong, according to Colliers International.

Colliers recently hosted its annual Commercial Real Estate Review and Forecast, which looked at economic activity, trends and projections for the commercial real estate industry in 2013, and forecasts growth for the coming year.

“2013 marks yet another successful year for commercial real estate in Saskatoon,” says Tom McClocklin, president for Colliers Saskatchewan. “We forecast that 2014 will follow suit for both Saskatoon and Saskatchewan.”

Saskatoon recorded strong growth across the office, industrial and retail markets. The Marquis Industrial area is home to the majority of growth in suburban office and industrial development.

The retail market is the city’s most consistent asset type. The retail vacancy rate dropped from 2.4 per cent in 2012 to 1.8 per cent in 2013. The most sought after opportunity in Saskatoon is retail on 8th Street, which saw rates exceed $40 net per square foot for the top-tier spaces.

The city is seeing an increase in suburban office development, with more than 65,000 square feet of office space completed in 2013. The Stonebridge area currently has 60,000 square feet of office space under construction. This area has seen growth of more than 300,000 square feet in office area over the last five years.

With a rise in suburban office development, the city’s downtown core has seen an increase in vacancy. At the end of 2013, the downtown vacancy rose to 5.65 per cent. It is expected to surpass eight per cent when the Saskatoon Police Services consolidates in its new location.

The industrial market added more than 440,000 square feet of space in 2013, while an additional 260,000 square feet is still under construction. Saskatoon’s absorption remained consistent in 2013, at just less than 600,000 square feet.