Comments–
Although the Index, a measure of average weekly office attendance in downtown Toronto, isn’t as high as expected by mid October, more and more employees are returning at least once a week. Interviews with human resource professionals suggest that this will continue until a balanced competition for good jobs returns.
Employers believe overwhelmingly working remotely is not as productive as many believed early in the pandemic. If this is the case, employers will start to limit the allowable amount of remote work in a wider range of functionality.
Suburban return to the office is now above 50%, but vacancies in the office market in most non-downtown locations is increasing. More on that in the November Index where we will comment on the impact of WFH on vacancy levels throughout the region.
Stay safe,
Your SRRA Team
Links to Articles of Interest
Dig beneath the headlines!
An ode to the value of data…This Bloomberg article about Kastle Systems Inc. takes us back to the dark days of April 2020 before it was obvious that information on the number of people working in the office vs working remotely was going to become so vital to all kinds of decision makers.
Using its unique building access swipe card data as the foundation for tracking office occupancy in thousands of office buildings in hundreds of U.S. cities, Kastle discovered a brand-new way to view the value of its sophisticated systems. Interestingly, the six largest BIAs in downtown Toronto (and the City) also had the foresight to understand how important and valuable tracking office occupancy could be when they agreed to fund SRRA’s role in developing and producing the occupancy index back in March 2020. Although the methodologies and scope of the two approaches to tracking office occupancy are clearly very different, there is little doubt that providing unique data to public and private sectors decision makers helped to keep the practical and economic penalties associated with large scale work from home trends in full view. The Bloomberg article, complete with graphic illustrations, traces changing perspectives on remote work over the past two and a half years, and in doing so highlights significant differences between U.S. and Canadian practices. As the only Canadian jurisdiction to benefit from regular, accurate estimates of office occupancy from the outset of the pandemic, Toronto provides an essential basis for understanding the complexities inherent in what drives the white-collar economy.
But every data set has its drawbacks. This article highlights a weakness in Kastle Systems data set that says many high profile, higher quality office buildings in New York City are not included in Kastle’s data conclusions.
The reason this is worth noting according to those in the know is that although the net cast by Kastle’s data is wide, it includes many A and B buildings in the cities it reports on. A significant number of ‘trophy’ buildings are not part of the company’s survey and this is significant because occupancy tends to be higher in ‘better’ buildings, according to the source quoted in the New York Post. In Toronto’s downtown, SRRA’s reporting is based on occupancy based on a broadly comprehensive range of properties and is not limited by focusing on a landlord’s portfolio of properties.
Messaging through the media can have both a positive and negative impact. A unique data set focusing on Canadian tech start-ups on their way to billion-dollar stardom brings some sunlight to grim commentaries on an impending recession.
Even as economic commentators lament the lack of IPOs on the Toronto exchange, here is evidence from a Waterloo-based NGO (Communitech) that the tech sector in Canada (including Toronto) is alive and expanding. For more than a decade, Communitech has been providing a high quality ‘brick and beam-like’ environment for tech start-ups in downtown Kitchener. Team True North was created to emphasize the depth and breadth of tech talent across the country. As with Toronto’s success with King-Spadina and King-Parliament, supported by innovative planning policies back the mid-1990s, Kitchener’s tech scene has grown from strength to strength in part because that city actively pushed the regeneration of former brownfield industrial properties.
https://www.blogto.com/tech/2022/10/17-toronto-tech-startups-become-billion-dollar-companies/
Goldman Sachs is almost back to pre-pandemic occupancy levels says its CEO.
One of the industry’s most outspoken opponents of remote work, David Soloman says that for the kind of work done by his company, it is essential that staff be back in the office – particularly important for younger workers, as personal growth and the work environment are clearly connected from his perspective. In case there was any doubt about his views, Solomon doubled down on earlier statements about remote and hybrid work situations, declaring that remote work is "an aberration that we are going to correct as quickly as possible."
Only in the U.S.? Landowner wins fight to sell ‘prime’ land that is underwater!
There really isn’t a problem here guys. The owner says he is willing to bring in enough fill to get the site up to the right grade. Could this be a solution for the owners of water lots in Ontario?
Inspired by the province of Ontario? Surely not. Mayor Adams of New York looking to spur affordable housing by cutting environmental regs?
Probably just a coincidence, but when the chips are down politicians get creative. Ensuring capacity in the schools? Overrated. That’s never been a problem here, just add a warning at the point of sale. The move in New York is still just a rumour but another example of the appeal of blaming approval time lines for the drop in housing affordability.
Why relying on headlines alone can steer you wrong!
The academic study cited below claims that hybrid work supports happiness and increased productivity. But it is important to know that the research focuses on the experience of call centre workers in China.
Finally…. Sometimes you need an individual to act as the saviour for arguing for an important city-building project. Or to stand against a city-destroying project.
Blanche van Ginkel counts among Canada’s saviours in the latter category. Among her accomplishments, she and her late husband Sandy were behind the planning of the Montreal Metro and the master plan for Expo ’67. But Blanche also single handedly (according to legend) stopped an elevated highway proposal in the 1950s that would have devastated what we know today as Old Montreal. She actually had to get a private members bill passed by the Quebec legislature to establish what became the Order of Urbanists of Quebec to avoid being sued by the highway engineer for practicing engineering without a license! She also was instrumental in creating the zoning that protects view of the mountain from downtown Montreal to this day. So who would you nominate saviours working for or against city building in the GTA?
“The Occupancy Index is supported by the City of Toronto, Financial District BIA, Bloor-Yorkville BIA, The Waterfront BIA, Downtown Yonge BIA, St Lawrence Market BIA and Toronto Entertainment District BIA. It is a measure of the percentage of office employees returning to the office compared to the number of employees who would normally have come to their offices pre-COVID. For a detailed description of the calculation please contact Iain Dobson at [email protected],”
