- What The amount of available industrial space continues to rise in the GTA
- Why 2.3m sq ft of new space entered the market in the quarter, with another 12.6m under construction
- What next Average asking rents for industrial space declined slightly and are expected to hover around current levels
The amount of available industrial space in the GTA continued to rise in Q2, hitting its highest level since late 2015, Avison Young said in a market report.
The availability rate now stands at 4% of the market’s total 938m sq ft, according to the brokerage. That’s 50 basis points up from Q1 and 210 bps higher than Q2 2023. Rent dropped 0.5% in Q2 to $18.14/sq ft.
“Rental rates are expected to hover around current levels as the explosive rental growth experienced in the past three years is not sustainable given the current rising availability rates,” Avison Young said.
Some 2.3m sq ft in 12 buildings came online during the quarter. Of that, just 51% was already leased. There were 46 buildings under construction at the end of the second quarter totalling 12.6m sq ft — 12% of which is pre-leased.
Across the GTA, sales volume ticked up 41% to $1.5bn, though the total number of individual industrial sales fell to 102 from 140 in Q1.
Capitalization rates remained unchanged quarter over quarter at 5.5%. The average sale price/sq ft in Q2 was $364/sq ft across the region. The most expensive deals were in Milton, which fetched $553/sq ft on average.
According to the brokerage, Milton had the largest land transaction on an aggregate basis during the quarter. Tribal Partners paid $55.6m, or $1.1m/acre, for just over 50 acres at 5122 First Line.
Tempel Steel paid $29.6m, or $1.8m/acre, for land at 3402 Appleby Lane in Burlington. The seller was Panattoni Development Co.
