Ottawa retail vacancy is 15 buildings, not downtown

Two headlines landed in September saying the same thing. CBRE's first-half rent survey, as covered by the Ottawa Business Journal and CTV, calls Ottawa retail "polarized": downtown storefronts sit empty while suburban space is hard to find. I believe the storefronts. But when I opened Cushman & Wakefield's H1 2026 Ottawa retail MarketBeat and did the multiplication, the vacancy is somewhere else entirely.

The arithmetic

The report covers 26,123,516 sf across 284 buildings, and says overall vacancy is 4.5%. That is about 1,175,600 vacant sf (26,123,516 x 0.045).

Now split it by the report's own categories:

• Regional malls and larger power centres: 15 buildings, 9,814,907 sf, vacancy 9.5% in the table. That is about 932,400 vacant sf.
• Downtown core: 19 buildings, 735,572 sf, vacancy 5.1%. That is about 37,500 vacant sf.
• Everything else (community and neighbourhood centres): 250 buildings, 15,573,037 sf. Subtract the two lines above from the total and you get about 205,600 vacant sf, or 1.3%. The report puts these segments at 1.4%, so the pieces fit together.

Fifteen buildings out of 284, or 5.3% of the buildings, hold 79% of the vacant space (932,400 / 1,175,600). The downtown core holds 3.2%.

One caution. The report's text says regional mall vacancy fell "to 10.3%," but its table shows 10.3% as the H2 2025 number and 9.5% as H1 2026. I used the table. Even at 10.3% the conclusion is the same.

Why this does not make CBRE wrong

The "downtown core" line in this report is 19 buildings and 735,572 sf. That is not the street. Bank Street and Rideau Street storefronts, the ones people walk past, are mostly not in a survey of centres and malls. So CBRE can be right about empty street frontage while Cushman is right that the vacant square footage sits in big boxes and regional centres.

Even within the 19 buildings, downtown is improving. Vacancy went from 6.2% to 5.1%. On 735,572 sf that is 45,600 vacant sf falling to 37,500, a drop of about 8,100 sf. The report shows net absorption of 7,965 sf for downtown. Those two numbers agree within about 130 sf, which tells me the category is stable enough to trust.

The rents run backwards

Asking gross rents per sf in the report: downtown core $53.22, regional malls $50.27, community malls $38.82, neighbourhood malls $38.15.

The two highest asks sit on the two highest vacancies. The two lowest asks sit on 1.4%. Downtown asks 39.5% more than neighbourhood centres (53.22 / 38.15 = 1.395). One caution on the lowest tier: at 1.4% vacancy there is almost nothing listed, so the asking rent is a thin sample. Still, the pattern is clear. Landlords ask the most where tenants have the most choice.

Gloucester is the exception that proves the rule. It is the loosest submarket at 11.1% on 490,086 sf (about 54,400 vacant sf), and it also has the lowest asking rent in the report at $29.04. Where space is truly in surplus, the ask does fall. Everywhere else, landlords are asking as if the space will fill, and in the tight tiers it probably will.

What a $65 building tells you

The former Bay on Rideau sold for $21.5 million on 332,000 sf, which is $64.76 a foot. The same report lists 300 Richmond Road, 18,546 sf, at $8.4 million, or $453 a foot. That is 7.0 times the Bay's price (453 / 65 = 6.97). Same city, same year, same report. A building with a small footprint in a tight pocket sells for seven times what a huge box in a loose pocket sells for. Buyers are already paying up for the tight tier, and the vacancy data says they are right to.

What I would do with it

If you are a tenant, check which tier your space is in before you negotiate. In a regional centre at 9.5% vacancy you have room to push on free rent and tenant inducements. In a neighbourhood strip at 1.4%, the landlord has other calls waiting, so be ready to move fast and be clean on your covenant.

If you are buying, do not use one city wide number. The 4.5% is an average of 9.5% and about 1.3%, and no single property is average. I covered how the three property types differ earlier, and the same logic applies inside retail.

How I will score it

Cushman's H2 2026 Ottawa retail MarketBeat, due in early 2027, scores two calls. First, regional malls and larger power centres stay above 7% vacancy. Second, community and neighbourhood centres stay under 2%. If both hold, the split in this post is structural. If regional malls fall under 7%, the vacancy was a few anchor boxes and the Bay closure, and the whole market tightens.

I sell real estate. I do not give legal, tax or lending advice, so your lease, your covenant and your financing belong with a lawyer, an accountant and a lender.

Looking at a retail unit, a plaza or a lease renewal? Call me at 613-262-6545 or email fil@613realtor.ca and send me the address and the rent. I will tell you which tier it is in and what that does to your leverage.