Population growth continues to drive the commercial real estate sector, with investors exercising caution and creativity in the face of economic uncertainty, as per a recent report by Re/Max Canada.
The 2025 Commercial Real Estate Report by Re/Max, analyzing first-quarter activity in 12 major markets, reveals that Canadian commercial investors are seizing opportunities to adjust their portfolios amidst escalating global tensions and economic uncertainties.
“Canada’s commercial real estate market is emphasizing fundamentals this year,” stated Don Kottick, President of Re/Max Canada. “There’s a shift towards purpose and practicality, driving revitalization, a focus on quality, and a more selective buyer pool.”
Institutional investors and Real Estate Investment Trusts (REIT) are cautiously re-entering the market, concentrating on acquisitions that offer long-term value in today’s complex operational environment,” added Kottlick.
Shelter and industrial sectors lead retail
The top-performing asset classes were multi-family and industrial, followed by retail, as per the report.
“Commercial markets are advancing steadily, driven by ongoing housing stock pressures, government policies promoting growth like the Housing Accelerator Fund, and a rise in e-commerce sales,” the report added.
Best performing provinces
According to Re/Max’s report, commercial activity is thriving in the Prairies and the East Coast.
Western Canada’s commercial markets, alongside Newfoundland and Labrador, led the nation in commercial growth in 2025, driven by population growth, increased investment, and strong economic performance.
Steady immigration and interprovincial migration in Alberta, Saskatchewan, and Manitoba fueled expansion, with shortages reported in various asset classes.
Newfoundland Labrador’s surge in resource and infrastructure projects is propelling the province towards renewed economic momentum.
Population growth driving multi-family construction
Kottick mentioned that population growth continues to boost the multi-family asset class.
“Both private and public investment, supported by public policy, are reviving nationwide construction of purpose-built rentals, while demand for existing portfolios remains high,” he added.
Industrial properties play a crucial role in the commercial sector, especially in the country’s logistics corridors.
While traditional malls face challenges, the retail sector overall is resilient, with neighborhood nodes performing well, particularly those anchored by essential services and shops.
“Although some growing pains are expected, commercial markets are poised for growth once the current challenges dissipate and clarity emerges,” Re/Max concluded.
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