The Commercial Real Estate Market in Canada is Starting to Normalize
1 min read.
The Canadian commercial real estate (CRE) market is showing signs of normalization in 2023. A Report from RE/MAX Canada stated that a change in sentiment and the return of some major players to the market, has resulted in an “upswing in demand” for the remainder of 2023. Despite a slight decrease in activity from the previous year's peak levels, the demand for commercial properties remains relatively healthy across major centers. This tight market has resulted in rising asset prices and lease rates.
While the office segment has faced some challenges as employers navigate hybrid work models, there is optimism for its future. The repurposing of office spaces into residential units offers a promising solution that is expected to drive long-term demand. This transformation aims to maintain the vibrancy of city centers by restoring vital foot traffic, supporting local businesses, transit systems, and the overall health of downtown neighbourhoods.
Overall, there is a growing sense of momentum and demand in the Canadian CRE market. The fundamental factors underpinning the market support ongoing commercial activity, providing a foundation for a more normalized and prosperous market throughout the year. With positive signs and a focus on adapting to changing dynamics, the Canadian CRE market is poised for a promising future.
References
McNutt, L. (2023, June 9). Commercial real estate report (Canada 2023). RE/MAX Canada. https://blog.remax.ca/commercial-real-estate-report/
Randall, S. (2023, June 2). Is Canadian commercial real estate set for a second-half surge?. Wealth Professional. https://www.wealthprofessional.ca/investments/alternative-investments/is-canadian-commercial-real-estate-set-for-a-second-half-surge/376440
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