In a bold move that reflects shifting tides across corporate North America, Starbucks has announced that all office employees must return to the workplace at least four days per week starting this October. The new mandate, up from three days a week, arrives alongside a significant offer, employees unwilling to comply are being offered a voluntary exit package, a clear signal that the coffee giant is serious about rebuilding its in-person culture.
CEO Laxman Narasimhan, echoing a sentiment increasingly shared by corporate leaders, stated that returning to the office is essential to solving complex problems, fostering creativity, and reestablishing a collaborative culture, particularly as Starbucks faces declining sales. And notably, for Canadian employees, the directive includes a requirement for all corporate people managers working remotely to relocate to either Seattle or Toronto within 12 months.
This decision isn’t just a Starbucks story, it’s a signpost in the broader narrative of the “great unwinding” of remote work, and it has direct implications for the real estate sector in Canada.
Back to the Office, Back to the Core – We need this now more than ever!
Over the past five years, remote work radically transformed the commercial real estate landscape. Office towers in downtown cores from Toronto to Vancouver saw dramatic declines in occupancy. Co-working spaces boomed. Home offices became the norm, and suburban residential demand surged as proximity to a downtown office became less of a priority.
But with Starbucks joining the likes of Amazon, Meta, and others in demanding more in-office time, and making location a condition of employment, a new chapter is unfolding. The return-to-office (RTO) wave is gaining critical mass, and Canadian cities, particularly major hubs like Toronto, Calgary, and Vancouver, are bracing for the ripple effects.
What This Means for Canadian Real Estate
Office Real Estate May Finally Stabilize
After years of uncertainty, Canadian commercial landlords are seeing glimmers of hope. The increased demand for in-office work suggests office towers in downtown cores could finally stabilize, or even rebound. With companies like Starbucks mandating physical presence, the surplus of unused office space may slowly begin to shrink.
Toronto, for instance, has one of the highest office vacancy rates in the country, hovering above 17% as of early 2025. If more firms follow Starbucks’ lead, we could see renewed interest in long-term leases and office retrofits, particularly for properties offering flexibility, amenities, and hybrid work support.
The Suburban Boom Could Slow
The pandemic fuelled a real estate rush to the suburbs and beyond, as Canadians sought larger homes to accommodate work-from-home life. But the reality of mandatory office presence, especially four days a week, makes long commutes less attractive. As companies like Starbucks require physical proximity, even requesting employees to relocate to Toronto, demand for downtown and near-core housing may grow once again.
We may begin to see a cooling-off in suburban property values and a shift in investment back toward urban residential developments, especially those that emphasize walkability, transit access, and short commutes to office districts.
Corporate Leasing Trends Will Shift
The real estate needs of corporate tenants are changing. It’s not just about square footage anymore, it’s about collaboration, culture, and flexibility. Starbucks’ push for a revitalized office culture highlights the value companies now place on their physical environments to drive innovation and community. A prime example of this in action is Jessica Diggles, Head Coach at REVEL North Bay., who is leveraging the strength of the North Bay community to foster connection and collaboration. Through her efforts, local businesses and entrepreneurs are coming together to work in alignment, all with a shared goal of enhancing and uplifting the community as a whole, and she’s even got a Coffee Bar in her newly built office!
Canadian landlords will be under pressure to offer premium, tech-enabled spaces that support this new mandate-driven RTO reality. Amenities that foster collaboration, think meeting hubs, wellness spaces, on-site cafés, and transit-oriented locations, will command a premium.
The Talent Equation Will Affect Urban Growth
One of the reasons Starbucks, like other major firms, is willing to offer buyouts is because leadership understands that not everyone will accept the new rules. But those who do are often younger professionals seeking career growth, mentorship, and connection, all things easier to achieve in person.
This means Canada’s cities may once again become magnets for young professionals, reversing the pandemic-era exodus. Urban planners, developers, and policy makers should pay close attention to the infrastructure, housing, and amenities needed to support this next wave of urban migration.
A New Reality, Remote Work Was a Phase, Not the Future
While remote work will never disappear entirely, the Starbucks decision, and the broader corporate trends makes one thing clear, the golden age of full-time remote work is over.
For Canada’s real estate market, this shift presents both challenges and opportunities. Developers, investors, and policymakers who pivot to support hybrid and in-office work cultures will be better positioned for success. Whether it’s revitalizing underutilized office space or creating livable, connected downtown neighbourhoods, the message is clear, proximity is powerful again.
The remote era may have reshaped how we live and work, but it didn’t redefine it permanently. In 2025, coffee shops aren’t the only places calling people back, so are the offices above them.
2025 is the year to inspire change and with this latest news of Starbucks’ corporate policy change, the RTO, return-to-office mandate, is a reflection of a growing consensus that in-person work is essential for culture, innovation, and performance. For Canadian real estate, this is a turning point. The remote era may have dented downtowns, but with the world returning to the office, four days a week and counting, it’s time to rebuild.
Cheers to a 5 day soon!
