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Oil prices are continuing to take a toll on Calgary with a new report due out Thursday showing almost 1.3 million square feet of space – the equivalent of two major office towers – returned to the market in the first quarter alone.

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As Alberta struggles with a brutal oil crash, Premier Jim Prentice said the province’s oil industry will deliver some of the world’s largest production increases in the next five years





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The report from CBRE in Canada, obtained by theFinancial Post, shows the absorption rate in Calgary’s office market has driven the overall vacancy rate up to 11.8% in the first quarter of 2015 from 9.8% in the fourth quarter of 2014. It was 9.1% a year ago.

“We are nearly nine months into the decline in oil prices and the Calgary office market has responded as expected. Both sublet and direct vacancy are on the rise but have yet to reach levels recorded during the last drop in oil prices in 2008,” said Ross Moore, director of research for CBRE.