These 4 Office Submarkets Will Benefit Most From New Transit

Transit expansion will bring big change to the GTA’s commercial leasing and investment landscape, as offices near stops get higher rents and lower vacancies. Here, via a report from Colliers, are four markets that'll benefit most.

1. GTA West

Only 5% of the office buildings here are within walking distance of transit stops. New service—via the proposed SmartTrack plan and the Main-Hurontario LRT—would up that to 14%, Colliers says. At Airport Corporate Centre, one of the GTA’s largest office submarkets, with 6M SF of space—only one existing building would be within walking distance of the SmartTrack stop, so there's a golden opportunity to develop new transit-oriented space. HOOPP’s Spectrum SQ (above) is right on the new Mississauga Transitway BRT line, putting it ahead of the curve.

2. Midtown

Midtown boasts the highest percentage of office space within walking distance of a rapid transit stop: 87% (versus 76% for the Downtown office market). And things will only get better with the arrival of the Eglinton Crosstown LRT. The Don Mills and Eglinton area in particular is poised for big change, Colliers notes, pointing to the recent deal for the Celestica site—which its new owners hope to turn into a mixed-use node with office, retail and residential—as evidence of the transformation that’s on its way in an area where office buildings are spread out, low-density and primarily Class-B.

3. GTA North

By far the worst submarket for transit connectivity, with 0% of its office buildings within walking distance of a stop. But this could change if SmartTrack, which would extend up to Unionville, comes to pass. The Toronto-York Spadina subway extension is playing a big part, too; SmartREIT’s Vaughan Metropolitan Centre is being configured around new transit (KPMG's complex there is rendered above). But with 70% of the current office stock near the new subway extension consisting of Class-B buildings, Colliers notes opportunity exists for upgrades.

4. GTA East

This submarket, and buildings like 101 McNabb St, above, will get a big boost from SmartTrack—with a number of stops in Scarborough and Markham—not to mention the extension of the Scarborough subway line and proposed Sheppard East LRT. Currently 17% of the office buildings in this submarket are within close proximity to transit; that’s expected to jump to 38% if the aforementioned projects come to fruition. Investors take note: Colliers says average sale price for GTA office buildings within walking distance of transit is $421 PSF, versus $197 for those that ain’t.

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