- What Commercial sales in the major Canadian property markets had a small uptick during the first quarter of 2025
- Why There was increased demand for essential retail properties and modest gains in industrial and apartment transactions
- What next Lingering uncertainty caused by tariff tensions with the U.S. is capping investor demand
Commercial property sales in Canada’s five major markets were up slightly during the first quarter of 2025, Altus Group said.
The big five markets of Toronto, the surrounding Greater Golden Horseshoe region – which includes the Greater Toronto and Hamilton Area – as well as Montreal, Vancouver and Ottawa racked up $9.1bn in commercial property sales for the quarter, Altus said in a market update to be released today.
While the amount represents a modest increase from the first quarter of 2024, when commercial sales for the five major Canadian markets reached $8.6bn, lingering uncertainty over U.S. trade tariff impacts are among the factors keeping investment activity largely in a holding pattern.
“There are a few more concerns now with the trade negotiations [between Canada and the U.S.] taking more time than what people thought,” Raymond Wong, Altus vice president and co-author of the report, told Green Street News. “It’s still wait-and-see on the specific impact of the tariffs.”
Nonetheless, green shoots were observed for the likes of retail property sales, which soared to $1.7bn during Q1, representing a year-over-year rise of 21% across the major Canadian markets. The sector was buoyed by high investor demand for food-anchored strip centres, the report said.
The apartment sector also saw growth in Q1, amassing $2bn in total sales, up 11% year over year, with investors showing interest in suburban rental buildings. And a modest gain was reported for industrial assets, which ticked up 6% year over year to $2.5bn in total sales for the quarter, much of that coming from transactions involving multi-tenanted properties.
On the flip side, the hotel sector posted a sharp decline in sales volume, registering a whopping 77% year-over-year decrease, with just $137m of sales transacted in Q1, according to Altus.
Residential land also saw a steep year-over-year decline, tumbling 41% in the quarter to come in at less than $1bn in total sales.
The office sector, meanwhile, realized a 17% drop in sales volume as the national availability rate remained at an elevated level of 17.1%. High-quality downtown office space continued to see more investor demand, with 3.3m sq ft of Class-A space leased over the quarter compared with less than 1m sq ft of leased space in lower-quality Class-B and -C buildings.
Among the top five Canadian markets, Montreal led the way with a strong performance across sectors, followed by Vancouver and the GGH. Conversely, Toronto’s investment activity dropped during the quarter while Ottawa’s remained largely unchanged.
