- What Vacancy rates for industrial properties dropped in Greater Ottawa during Q3
- Why No new space entered the market for the third successive quarter
- What next Two new buildings in Kanata totaling 479,000 sq ft are expected to come online by the end of 2024
Fueled by strong demand and a lack of new space, Ottawa’s industrial vacancy rate fell 17 basis points to 1.7% during the third quarter, Colliers said in a new research report.
No new supply was delivered for the third consecutive quarter in the Greater Ottawa Area – which includes the City of Ottawa along with Kanata to the west and Orléans in the east. The availability rate also dropped 17 bps, to 2.1%.
Overall, 75,000 sq ft of industrial space was absorbed into the market during Q3, most of that occurring in Kanata – largely driven by Montréal-based Intelcom’s agreement to lease 47,000 sq ft – and central-west Ottawa, where two units were leased at 250 City Centre Avenue.
Rental demand was competitive across the board. Eighteen small-bay (under 12,000 sq ft) leases were signed in Q3 for a combined 105,000 sq ft, and several deals for large-bay spaces, particular those in the 20,000 to 30,000 sq ft range, are underway. Average net asking rents across the region rose to $16.46/sq ft, up 3.2% year over year.
According to Colliers, the biggest lease signed during the quarter was an agreement by AutoShack to prelease 249,000 sq ft at a facility under construction by Montréal-based Rosefellow at 115 Journeyman Street in Kanata. The developer also is finishing a neighbouring 230,000 sq ft property, at 405 Huntmar Drive. Both buildings are expected to come online in Q4.
Sales activity was largely muted in Q3, with the largest recorded trade being Westrich Pacific’s acquisition of a 30,000 sq ft central-west Ottawa building at 2655 Queensview Drive from a developer for $7.6m, or $253/sq ft.
Also, a numbered Ontario company agreed to pay $2.8m, or $255/sq ft, for an 11,000 sq ft property at 1419 Michael Street in east Ottawa.
