Tenant's Guide Ottawa - 1st Quarter 2015 Ottawa's first quarter saw a higher than normal amount of leasing activity with several large firms electing to make a change in their office premises. Tenant's Perspective Greater Ottawa's vacancy rate increased almost a full percentage point since last quarter and now stands at 9.1%; the highest level in a decade. Based on a ten year average of 6.3%, local tenants are experiencing a large amount of choice at very competitive rents. Ottawa's first quarter saw a significant amount of leasing activity. Though several large transactions were concluded in Kanata, many of these tenants left vacant space behind which offset most of what was absorbed. Greater Ottawa Vacancy Hits Ten Year High. Kanata's vacancy now stands at 11.4% which may appear fairly balanced. But with most of the empty space contained in just a few properties, the reality is that Kanata's market is tighter than it seems. Kanata continues to heat up and is moving to a landlord's market. Rental and Vacancy Rates $ per SF Vacancy Rate Margin from Q4 Market Trends Net Rental Rate 15.28 Greater Ottawa - Overall 17.87 Greater Ottawa - Class A 13.64 Greater Ottawa - Class B 18.78 Downtown Core - Overall 24.79 Downtown Core - Class A 16.55 Downtown Core - Class B 13.26 Suburban West - Overall 14.72 Suburban West - Class A 12.09 Suburban West - Class B 9.1% 0.1% 8.2% 9% 8.3% 0.2% Ten Year High in Ottawa's vacancy. 0.5% Big Moves Announced as several large firms prepare to relocate. 0.8% 6.3% 0.4% 8% 1.0% 10.1% 0.1% 7.9% 0.3% 15.5% 0.4% Recent Transactions Tenant Size Submarket Type Sector Gowlings LLP 132,000 160 Elgin Street Renewal Legal PWGSC 135,000 219 Laurier Ave. West New Lease Government N-Able Technologies 49,000 450 March Road Renewal & Expansion Technology Mxi Technologies 45,000 175 Terence Matthews Cres. New Lease Aviation Shopify 32,777 150 Elgin Street Expansion Technology Rogers 12,949 350 Albert Street New Lease Media Kanata Market Heats Up even in the face of flat vacancy. The Tenant’s Advantage Ottawa, ON – Q1 2015 Ottawa Office Vacancy Total Number of Existing Buildings Total Existing Office Area (sq. ft.) Total Occupied Area (sq. ft.) Vacant & Leased Area Direct Available Vacant Area Sublet Vacant Area Total Vacant Area Total Vacant Rate (%) 451 44,777,420 40,675,875 139,796 3,655,456 306,293 4,101,545 9.2 Downtown Ottawa 124 18,395,960 16,871,787 73,496 1,327,085 123,592 1,524,173 8.3 Gatineau 32 4,480,711 4,265,081 0 170,130 45,500 215,630 4.8 Suburban-East 79 5,769,319 4,993,339 0 760,918 15,062 775,980 13.5 Suburban-West 216 16,131,430 14,545,688 66,300 1,397,323 122,139 1,585,762 9.8 Class A 187 25,412,948 23,288,930 94,796 1,817,371 211,851 2,124,018 8.4 Class B 208 16,860,658 15,343,904 45,000 1,384,210 87,544 1,516,754 9.0 Class C 56 2,503,814 2,043,041 0 453,875 6,898 460,773 18.4 Sub-Market Greater Ottawa All Office Classes Source: Altus Insite Availability The chart to the right shows the number of lease options over 50,000 sq. ft. over the past ten years. Available for Lease Options Downtown Ottawa All Office Classes The yellow line indicates the Availability Rate over the same period. Office availability is the sum of vacant and advertised space, over the denominator of the total office inventory. Prepared By Cresa Ottawa 130 Slater Street, Suite 310 Ottawa, ON K1P 6E2, Canada 613.688.7200 | www.cresa.com