The office market has changed more in the past few years than in the previous two decades, and suburban office space in York Region has been reshaped along with everything else. For businesses evaluating space in Markham or Richmond Hill, that shift has created genuine opportunity, provided you know where to look and what to negotiate.
Why suburban office still competes well
The Highway 404 and 407 corridor through Markham supports a dense concentration of technology, financial services, and professional firms, with Richmond Hill offering similar access along Yonge Street and the 404.
The persistent advantages over downtown Toronto are straightforward: markedly lower gross occupancy cost per square foot, and parking ratios that suburban buildings can offer and downtown towers structurally cannot. For a workforce that largely drives, parking is not a perk, it is often the deciding factor.
Transit has improved the picture as well, with GO service and Viva bus rapid transit along Highway 7 and Yonge Street making some buildings genuinely accessible without a car.
Understanding building classes
Office space is commonly described as Class A, B, or C. The classification is relative rather than technical, but broadly:
- Class A, newer or well-modernised, strong mechanical systems, better finishes, more amenities, highest rents
- Class B, older but well maintained, functional, meaningfully less expensive
- Class C, older stock with dated systems, lowest rent, often the highest build-out and operating costs
A well-run Class B building frequently represents better value than an average Class A, particularly for a business whose clients rarely visit the office. Judge buildings individually rather than by label.
Rentable versus usable area
Office space is almost always quoted on rentable area, which includes a proportionate share of common areas, lobbies, corridors, shared washrooms, mechanical rooms. Usable area is what your team actually occupies.
The difference between the two is the gross-up or loss factor, and it varies meaningfully between buildings. Two suites quoted at the same rentable rate can differ in genuinely usable space. Ask for both figures, and where the difference is significant, ask for the measurement standard used.
Where tenants currently have leverage
Hybrid work reduced net demand for office space, and the resulting softness has shifted negotiating power toward tenants in much of the suburban market. Areas worth pressing:
- Tenant improvement allowances. Landlord contributions toward build-out have become a central point of competition.
- Free rent periods. Often more achievable than a lower face rate, since landlords protect the headline number for building valuation purposes.
- Sublease space. Companies that downsized frequently hold surplus space and will accept below-market rates to reduce their obligation. Terms are shorter and the space is usually already built out, a strong fit for the right tenant.
- Shorter terms or early termination rights. More attainable now than they were, though usually with a fee attached.
Operating costs and the details inside them
Most office leases are net, with base rent plus TMI, taxes, maintenance, and insurance. Some questions worth asking before signing:
- After-hours HVAC. Many buildings run heating and cooling on a set schedule and charge hourly beyond it. For a business working evenings or weekends, this becomes a real recurring cost.
- Are utilities separately metered or allocated by area?
- What capital items are included in TMI, and what is charged separately?
- Is parking included, and if reserved, at what monthly cost?
Right-sizing the space
The most common mistake right now is signing for the space a business used to need. Hybrid patterns have changed the calculation substantially: fewer assigned desks, more meeting and collaboration space, and better technology in every room.
Take an honest measurement of actual daily attendance rather than headcount before deciding on size. Where growth is genuinely likely, a right of first refusal on adjacent space is usually a better solution than paying for square footage you will not occupy for two years.
Buying instead of leasing
Office condominiums exist across Markham and Richmond Hill and appeal to professional practices with stable, long-term space needs, medical, dental, legal, accounting. Ownership fixes occupancy cost and builds equity, but reduces flexibility and involves condominium fees plus a share of building capital costs.
For a practice confident it will occupy similar space in a decade, the numbers often work well. For a business whose size may change materially, leasing usually remains the better fit.
Ray Azar represents office tenants and purchasers throughout Markham, Richmond Hill, Vaughan, and North York. Learn more about commercial real estate services or discuss your requirements.
General information only. Have any commercial lease or purchase agreement reviewed by an Ontario lawyer.