Figures

Toronto Downtown Office Figures Q3 2026

Shifting office market fortified by pervasive fundamentals

October 20, 2026 5 Minute Read

Overall vacancy decreased by 40 basis points (bps) as Downtown Toronto recorded over 230,000 sq. ft. of positive net absorption in Q3 2026. Net new leasing increased by approximately 450,000 sq. ft. quarter-over-quarter, while average net asking rents continued to rise across all building classes.
The preference for quality built-out space strengthened in Q3, accounting for 74.2% of transactional activity as large-block supply continued to diminish. This shift has increasingly centred leasing activity around mid-sized blocks between 50,000 and 100,000 sq. ft.
The office market’s recovery continues to broaden as tenant occupation increases. Sublease vacancy reached its lowest level since Q2 2020 and demand for space has spread beyond the Downtown Core.
Despite renewed Canada-U.S. trade tensions, Downtown Toronto’s office market has remained resilient, with leasing momentum showing limited disruption from broader economic uncertainty. Continued investment in Canada provides further optimism that Toronto’s position as the country’s largest economic hub will support the next phase of office recovery.