HALIFAX—Office space is filling up slightly in Halifax, though vacancy rates in downtown Halifax went up again in the past year.

The latest rental market survey from Halifax real estate consultants Turner Drake, released Thursday, found that the overall vacancy rate for office space in the municipality was 14.62 per cent in June 2019, down from 15.09 per cent in June 2018.

The lower vacancy drove rents up by three cents to an average of $14.08 per square foot in the entire municipality.

But in what Turner Drake calls the central business district, downtown Halifax and surrounding areas, vacancy rates were up 0.86 percentage points, from 18.03 per cent in June 2018 to 18.89 per cent in June 2019.

Forty per cent of Halifax’s office space is located in the central business district, Turner Drake said in a news release. New, higher priced class A space built in recent years, like the Nova Centre, has “attracted tenants out of some of the older rental stock” and driven up vacancy rates in class A, B and C space.

“More new space is expected to be brought to market in the next year, downtown and outside the CBD,” the release said.

But Turner Drake is predicting stable vacancy rates in the coming years.

“Halifax has enjoyed economic strength over the past number of years, a trend which is expected to continue in the year ahead,” the release said.

“Increasing demand is expected to be sufficient to keep the vacancy rate from further increases in the near term, and good deals are available.”

Turner Drake derives its numbers from rental, operating expense and vacancy data collected for more than 300 office and industrial building in the municipality.

In January, the overall commercial vacancy rate in the municipality fell year-over-year from 14.99 per cent to 13.86 per cent. Alexandra Baird Allen, Turner Drake’s manager of economic intelligence, told Star Halifax at the time that the municipality was still a long way from a balanced or healthy market, which she said would be a vacancy rate of 4 to 5 per cent.

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