Toronto set investment records in 2017 with over $15 billion of new institutional investment being recorded in commercial real estate Toronto. The city’s global reputation continues to grow as a relatively safe place to live and predictable government make it an attractive investment destination..
Technology is expected to be a major drive in creating demand for Commercial Real Estate Toronto including office and industrial space throughout the greater Toronto area. The downtown office market which has traditionally been driven by the FIRE sector is experiencing significant activity and demand from that technology sector which has helped push office vacancies to an all-time low. This is particularly true in the brick and beam areas on the fringes of the downtown core.
Construction is booming in downtown Toronto with a total of 5.1 million square feet of office space currently under construction. Confidence in the market is soring as developers have started to build class A office towers on a mostly speculative basis for the first time in years.
The vacancy rates for industrial space in the greater Toronto area are at an all-time low of about 2.2%. Net rental rates have risen as a result of this pressure on vacancies. Land cost and construction prices continue to increase and it is expected that the GTA will see industrial development continue over the coming years.
The rise of e-commerce has impacted the market. Retailers have begun to question how to effectively structure their real estate holdings to provide an efficient and effective supply chain from suppliers to consumers.
Toronto continues to be a top destination for new immigrants coming to Canada. It is expected that the demand for multi-unit housing will continue to grow. Land costs make construction expensive and development proformas difficult so developers will look to explore intensification options on sites that they currently own to increase the densities of their Commercial Real Estate Toronto.