2025 Canada Toronto Industrial Property Insights [DaisyRealty®] скачать в хорошем качестве

2025 Canada Toronto Industrial Property Insights [DaisyRealty®]

When it comes to industrial real estate, there are many types and participants, making structured thinking and analytical methods essential. Daisy Huang summarizes the following analytical framework and participant dimensions. Each year, she combines her extensive commercial real estate transaction experience with research reports from major industry leaders such as CBRE, providing a snapshot of Canada’s and Toronto’s industrial properties—their current state and key indicators. All capital seeks profit, and the capitalization rate is the most critical indicator of a commercial real estate asset’s value and return. It reflects changes over time in an asset class’s valuation, income performance, and risk trends. The higher the risk of an asset, the higher its capitalization rate. Government bonds are considered risk-free assets, so their yields—or capitalization rates—are the lowest compared with other assets. Looking closely at capitalization rate trends across different types of commercial real estate in Canada, the typical risk ranking from lowest to highest is: multi-family residential, industrial, retail, office, and hotel. Over the past five years, capitalization rates for factories and warehouses have risen somewhat but have recently eased downward, indicating that the market currently views industrial property valuations as generally reasonable. Looking at specific categories, Canada’s Class A industrial and warehouse properties have lower capitalization rates compared to Class B, reflecting lower risk. As the country’s largest city by GDP, Toronto’s industrial and warehouse capitalization rates are also 0.5 to 0.8 percentage points below the national average, indicating more stable and secure returns. Looking at investment volumes across different types of commercial real estate, according to CBRE data, in the first quarter of 2025, Canada’s industrial and warehouse properties recorded the largest investment volume, but it declined significantly compared to the quarterly average over the past three years. In the first quarter of 2025, industrial and warehouse properties accounted for the largest share of investment transactions in the Greater Toronto Area. Banks play a vital role in commercial real estate projects and are among the most sensitive to market shifts. Recently, banks have shown increased willingness to lend, signaling growing confidence in the sector—over 90% of banks expect to increase lending to commercial real estate in 2025. Lenders have their preferences and risk biases. CBRE’s latest survey shows banks prefer increasing loans to single-family homes, retail stores, and industrial properties; they intend to maintain lending for high-rise apartments and hotels, and reduce loans for office buildings and development land. This aligns with credit risk assessments showing increasing risk for development land and office assets, while retail and industrial are considered lower-risk. Industry is the main pillar of a nation’s economy, and the vacancy rate of industrial and warehouse properties is one of the indicators of its strength or weakness. Over the past three years, the vacancy rates of such properties in both Canada and Toronto have risen significantly. In recent years, industrial real estate rents in Toronto have shown a downward trend, but prices have rebounded since the end of 2024. CONCLUSION: Despite economic headwinds and unavoidable tariff adjustments with the U.S., uncertainty is decreasing. The U.S. Federal Reserve is likely to initiate rate cuts, which will ripple globally and lead to further rate cuts in Canada—providing a boost to industry, services, and commercial real estate, and serve as hedge against the headwind. While many real estate participants remain cautious, doing nothing is not an option. Strategic planning and activity within the industry continue, as good deals and opportunities still emerge. The risk and valuation of various types of commercial real estate have changed significantly in recent years, with the outlook for the industrial real estate market being relatively neutral. About Creator: Daisy Huang Top Commercial Realtor in the Greater Toronto Area KOL for GTA real estate market Diamond Award Winner Hall of Fame Cell Phone +1 647 899 0888 (WeChat/WhatsApp/LINE/Telegram) https://daisyrealty.ca/en/ https://daisyrealty.ca/en/market-dyna...