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The 2025 forecast for Canadian commercial real estate is optimistic, with a rebound in transactions and companies looking to expand office space. However, challenges remain due to evolving work patterns, AI developments, sustainability concerns, and uncertainty surrounding the new U.S. administration. Despite these headwinds, experts predict growth in the sector.

The recent reduction in interest rates by the Bank of Canada is expected to stimulate the market, with both Canadian and international investors showing interest in acquisitions. A Deloitte survey found that 68% of global executives anticipate increased transaction volumes and capital availability in 2025, marking a significant shift from last year’s outlook.

While the commercial real estate market is recovering, high construction costs and an oversupply of office, retail, and industrial spaces are slowing new developments. Warehouse vacancies may rise due to overbuilding during the pandemic, but retail vacancies are declining, and rent prices are increasing, boosting investor interest in Canadian retail properties.

Read the full article on: THE GLOBE AND MAIL