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Real Estate in 2020 - What You Need to Know


Last year was nearly unprecedented for the Canadian commercial real estate industry. Canada outperformed its G7 peers riding on the strength of its welcoming immigration policies, attractive labour pool and stable operating environment. In 2020, the industry will not only move forward, several sectors will reach top speed.

At a time of trade hostilities and geopolitical shifts, Canadian commercial real estate emerged as a feel-good story – no longer simply a safe haven for investment, it is now a top destination for domestic and global capital. Gone are the days of promising Canadian graduates embarking for bigger opportunities abroad. This trend has reversed course and the world’s most prominent companies are establishing themselves in Canadian cities, attracted to the relative affordability of these markets and their deep pools of talent. Brain drain no more, big gains are likely.

Canadian commercial real estate has traditionally been conservative as an industry, unaccustomed to exuberant highs and bullish forecasts. Course corrections and adjustments will inevitably happen and it will be important to avoid knee-jerk reactions at high speeds. If the sector grows overly cautious or takes its eyes off the road ahead, it risks losing momentum and undermining our country’s competitive advantage. This appears to be Canada’s decade for the taking and there will be incredible opportunities for commercial real estate along the way.

Momentum Markers: Demand and Rising Rents

Record demand and strong fundamentals are the product of countless decisions over many years. In fact, commercial real estate is a lagging beneficiary of policy decisions, technological developments and societal changes across multiple decades. The record-setting pace of Canadian real estate growth largely stems from two forces. First, that Canadian cities have become sought-after destinations for businesses, residents and investors. Second, that real estate is widely regarded as a stable yet high-yielding investment.

Whether it’s in the form of accelerated rent growth, strong tenant demand or an unprecedented development pipeline, record-setting performances have become ubiquitous in Canadian commercial real estate. Prime office rents increased from 10.0-20.0% across the country between 2018 and 2019, up by 20.9% in Vancouver, 14.2% in Montreal and 10.1% in Toronto. Meanwhile, national industrial rents rose by $0.95 per sq. ft., or 12.3%, the largest annual increase on record. Overall national apartment rents were up by 4.2% year-over-year. This is particularly striking given that these figures include suites in markets with rent control. Even asset classes in transition are experiencing success, as evidenced by strong rental growth in high-end retail centres.

In 2020, further rental rate increases appear to be unavoidable amid record-low vacancy and strong demand. The traditional business cycle no longer seems to apply. The bull market is in its 11th year, with unmet tenant demand carrying over from one year into the next. Nearly 70% of downtown office space under construction nationally has been pre-leased and over 50% of the record amount of industrial space under construction has been spoken for.


Investment in Canada could exceed $50 billion

Interest from investors is supported by Canada’s world-leading banking system, attractive currency play and levered returns. The favourable financial landscape will attract more investors from around the globe and support property value growth in 2020. Optimism increases when one considers that the amount of capital on the sidelines, known as “dry powder”, is at an all-time high. The pressure to deploy capital is high as yields across the investment spectrum continue to shrink. Investor demand for commercial real estate extends beyond traditional core markets to include nodes such as West Queen West in Toronto, and smaller markets like Kitchener-Waterloo, Hamilton and the B.C. Interior.

Montreal, once a major city with second-tier investor interest, saw its investment volume climb to a record $7.5 billion in 2019, up from $6.0 billion the previous year. Investment volume could jump to more than $8.0 billion in 2020, significantly above its $4.6 billion 10-year average and a new record for commercial property transactions in that city. Canadian commercial real estate has transitioned from being regarded as a safe haven investment to a primary investment destination. However, investors assessing an increasingly limited range of top-end, core offerings have had to get creative when it comes to finding larger opportunities. This sets the stage for further mergers and acquisitions, and large-scale portfolio activity in 2020.

While 2019 fell short of hitting a fourth consecutive record for investment volume, 2020 is off to a roaring start, teeing up what could be an unprecedented $50.0 billion year. In response to this seemingly relentless bull market, construction activity is ramping up. While rising construction costs are challenging development pro-formas, market watchers are waiting to see if office and industrial rent growth will moderate following years of rapid increases. New technology is another factor that could have unexpected impacts. But most tangible will be the effect of e-commerce on the performance of bricks-and-mortar stores. While these factors may signal some moderation in the years ahead, they are unlikely to slow the momentum of the Canadian commercial real estate market in 2020.

Inside Out: Real Estate from the Tenant Perspective


As rental rates continue to climb amid record-low vacancy rates, tenants are having to make difficult choices in order to secure space that keeps them relevant and productive over the lifespan of a lease. A lack of desirable square footage in major centres is presenting a serious challenge to many companies looking to enter or expand in the Canadian market. Across the country, quality commercial space is increasingly being treated as a commodity. Touring multiple locations that align with a tenant’s desired size, location and quality of space is a rarely afforded luxury. Out of necessity, tenants are now encouraged to move quickly toward viable solutions. Landlords trying to accurately determine the value of indemand office space, warehouses and serviced land are occasionally resorting to something akin to spot pricing

Inside Out: Real Estate from the Tenant Perspective

As rental rates continue to climb amid record-low vacancy rates, tenants are having to make difficult choices in order to secure space that keeps them relevant and productive over the lifespan of a lease. A lack of desirable square footage in major centres is presenting a serious challenge to many companies looking to enter or expand in the Canadian market. Across the country, quality commercial space is increasingly being treated as a commodity. Touring multiple locations that align with a tenant’s desired size, location and quality of space is a rarely afforded luxury. Out of necessity, tenants are now encouraged to move quickly toward viable solutions. Landlords trying to accurately determine the value of indemand office space, warehouses and serviced land are occasionally resorting to something akin to spot pricing

Large institutional office tenants, scaling technology companies and distribution centre tenants are better able to take these hurdles in stride, while smaller tenants are more likely to struggle to adapt to these shifting dynamics. In some instances, government real estate tax rates, not rental rates, are causing problems. In Calgary and Edmonton, rising taxes have driven industrial tenants outside of the city limits. Prohibitive property taxes have forced some retailers to close shop altogether in these, and other, urban centres.


Sensors to help repurpose and optimize space

Where margins are healthier, tenants are mostly motivated by alignment with corporate culture, ease of transaction and flexibility in their real estate strategies. In years past, a top office tenant might have been tempted by a heavily induced 10-year deal; today they seek the agility of a one to three-year deal, even if it comes with a hefty price tag. Even once space is secured, other challenges present themselves. The rapid growth of technology, changing demographics and a shifting global economic environment have all led to increased unpredictability. At a time when businesses are driven to be more dynamic, long-hold leases make adapting to change increasingly difficult. Addressing changing business and employee needs often requires adapting workspaces. Increasingly, everything from meeting rooms to cafeteria spaces will be monitored with the help of sensors so that they can be repurposed and optimized during an existing lease.

Meanwhile, industrial tenants are making decisions in a world of increasing automation. Flexibility in built form is key, especially when the capabilities of future technology remain largely unknown. And while some tenants can relocate to increasingly distant suburbs in search of cheaper rent, others from last mile logistics, film production and self-storage cannot. Rising build-out costs, trades shortages and lengthy permitting processes can also add stress prior to occupancy. While real estate costs currently represent only a fraction of the overall price tag for office and industrial occupiers, high rents combined with limited quality space could begin to create friction in business decision-making and slow economic growth. It is in the best interest of all stakeholders, especially government and landlords who have multi-decade investment horizons, to help attract and support tenants in this era of dynamic change.

Creative Solutions: Occupiers Rising to the Challenge

Occupiers looking to succeed in a tight market will need ingenuity, resolve, advance planning and the guidance of industry experts. In cities across the country, office tenants are adapting their plans as they are met with harsh realities. When growth across contiguous floors is not possible, more and more office occupiers are considering a hub and spoke model, where a traditional office houses the headquarters of the business and secondary locations, whether in the same market or a different city, enable agility and growth.

Downtown connectivity and amenities will remain highly sought after, however, non-core locations with transit connectivity will attract new office development and eager tenants in 2020. In Toronto for example, the Junction, Downtown East and Liberty Village will become increasingly mainstream office nodes. Where space is entirely lacking or misaligned with occupier requirements, tenants will continue to turn toward coworking and flexible real estate operators, which provide much needed agility and desirable amenities in otherwise unyielding markets.

Occupiers hoping to densify an existing or new space may also come up against unforeseen limitations. Cost-efficient workplace strategies, including dedicated floors to hot-desking and open workspaces, were once lauded as a way to justify steep rental costs, but have proven to be problematic. These strategies are being re-evaluated to account for the potential loss of productivity, increase in noise, and lack of opportunities to personalize surroundings


In the industrial market, very limited large bay options are forcing tenants to reconsider their desire to have all operations housed in a single distribution centre in a major centre. To avoid the operational and transportation inefficiencies that an ill-suited site might cause, companies are pivoting to bookend the city with smaller mid-sized locations. The role of strategic partnerships is also growing. As operations become more complex and the availability of space remains low, companies are solving for this by outsourcing functions which had formerly been completed in-house to third-party logistics firms. As lease terms extend and skilled labour becomes increasingly expensive and scarce, some industrial occupiers are turning to technology and automation to help drive performance. Automation implementation costs are expected to decrease as industrial robot costs are forecast to fall another 50% over the next five years. For their part, wages are up 7% to over 20%, depending on the specific role, and are only forecast to keep rising.

Other efficiencies are being found in built form, with clear heights increasing to maximize cubic space and allow for impressive racking systems to be built right into the frame of industrial facilities. 40’ clear heights will be the new norm for speculative developments, while build-to-suit construction has made 90’ clear heights possible. Not long ago, these types of buildings and multi-storey distribution facilities would have been unthinkable. For their part, retailers are embracing the evolution of the omnichannel model, reaching their customers through a successful online presence bolstered by fewer, but higherprofile, bricks-and-mortar locations in primary markets. Portfolio trimming will allow service-focused tenants, from boutique fitness to food and beverage companies, to step up to the plate to occupy well-located street-front centres. No matter the sector, planning ahead is the only real solution for tenants facing difficult circumstances. Further steps must be taken to increase agility, including the involvement of the entire C-suite to better forecast headcount growth and hiring workplace experts to help de-risk the process.


While commercial real estate trends typically emerge and become most prominent in Canada’s largest cities, there’s plenty happening in its smaller markets. Global events and broader workplace trends are shaping investment and real estate decisions across the country, which will put smaller cities in the spotlight in 2020. Capital flows typically gravitate to core assets in major markets. While this will remain true in 2020, the dynamics at play will support healthy investment volumes in secondary and tertiary markets. Domestic players looking to compete with foreign capital in major markets and de-risk their portfolios have already begun targeted disposition programs that will unlock assets in smaller cities. Expect mid-sized domestic players and private capital to jump at the chance to acquire higher-yielding assets in places like Ottawa, Waterloo Region and the province of Quebec in the year ahead.

Smaller markets are also expected to receive a boost from a variety of real estate trends, including spillover from highdemand major markets. Logistics companies are making their way to areas around Toronto, increasing demand in Milton, Pickering Ajax, Hamilton, Kitchener-Waterloo and Guelph. Office tenants in Vancouver are increasingly comfortable with options in Burnaby and beyond. This trend can be seen across property types, as tenants search for more suitable offerings further afield. In fact, desirable submarkets located within secondary cities with serviced land and a pool of skilled labour could expect to see rents rise by as much as 15.0% in the coming year.

And despite the fact that major players have exited some of the smaller retail markets in recent years, local ownership and knowledge can give properties new life. Locally-driven innovative strategies are expected to transform portions of malls and community centres into office spaces and homes for public services like police departments and libraries. Significant opportunities for land sales and development exist in secondary markets with public transit connections. Suburban “downtowns” are popping up in major geographies, including Vaughan Metropolitan Centre, Downsview Park and Downtown Markham in the Greater Toronto Area. There are also intensification opportunities for retail centres, hotels and seniors housing complexes that become unlocked by transit expansions beyond dense urban cores. This is already playing out in the areas surrounding Vancouver and Montreal where large public transit investments are taking shape. While it is easy to focus on activity in major markets, there are large suburban populations and vibrant businesses across Canada. Smaller cities will get a closer look in 2020.

New & Evolving Uses

Amid limited space and high demand, sectors across the Canadian commercial real estate industry are embracing innovative uses of space. Office tenants and developers are exploring new workplace solutions, balancing cost with organizational culture. As tech companies continue to set a new standard for unique modern offices, other businesses are taking note, implementing new technologies like employee sensor-monitoring, virtual reality decision making and data-driven headcount modelling. In the multifamily sector, much has been made of co-living, which offers residents high-quality units with shared living spaces and amenities. While U.S. and UK based companies Common and Node are beginning to establish themselves in the Canadian market, they are unlikely to challenge the existing traditional rental model anytime soon. Meanwhile, the retail sector is rethinking uses for spaces in prime locations. Storefronts are being transitioned into pick-up stations for everything from food to apparel, while secondfloor and podium retail spaces in mixed-use properties are being leased for office use.

The rise of “ghost kitchens” – food preparation and cooking facilities set up for delivery-only meals – are most likely to be found in sites with laneway access near prominent downtown locations. More problematic retail properties in the downtown and suburban areas of major markets are getting a second life when redeveloped for other purposes on valuable land. In the industrial sector, former manufacturing sites are being redeveloped with great success. In the past year, announcements have been made for planned projects that will transform a former Schneider’s meat plant in Waterloo Region into an 11-building, 2,800-unit residential project, while a former Maple Leaf Foods plant in the Zorra Township of Ontario will be redeveloped into a similar 800-unit residential project. In markets where population density is high and rents are climbing, interest in multi-storey industrial buildings is gaining traction. One such project was unveiled by Oxford Properties in 2019 in their Riverbend Business Park and is set to be complete by 2022. Additionally, with online grocery delivery set to skyrocket in the coming year, the number of cold storage facilities will need to increase to keep up with demand. These creative uses are what will allow businesses and landlords to maintain momentum despite the complications of a tight real estate market and a rapidly growing economy and population

Focus on Structural Issues: Affordability, Infrastructure and Climate Change

Along with the start of a new decade, significant structural issues are impacting cities across the globe. These issues will have a more profound impact than the ups and downs of the business cycle, which has traditionally preoccupied the commercial real estate industry. Three structural issues in particular will be in focus for businesses, employees and residents in 2020: affordability, infrastructure and climate change. In major cities like Toronto and Vancouver, where the cost of living continues to outpace income growth, homeownership is increasingly out of reach.

This has the potential to drive Millennials and low to middleincome workers away from downtown cores. Adding the necessary housing density is challenging in the face of the so-called “yellow-belt,” or the swathes of low-rise homes protected by restrictive zoning in Toronto. As housing prices rise, transit infrastructure will become even more important. People living outside major downtown cores will need to commute from further away. This will be a major issue as urban infrastructure is already operating at or near planned capacities and suffering from under investment.




A Statistics Canada study released in 2019 found that 1.5 million Canadians spent at least 60 minutes commuting to work, with 57.0% commuting by car. In addition to lost time, studies have shown that longer commutes reduce productivity, affect health and wellbeing, clog roads and slow the movement of goods. If this under investment in transit continues, it has the capacity to restrict business growth, with new commercial space fighting for proximity to a limited number of transit hubs. Meanwhile, the threat of climate change hangs over these conversations. Wildfires, heat waves, intense rainfall and other natural disasters are increasingly common and will shape tenant, landlord and investor decision making. Low-risk areas will likely attract demand and experience rising prices. This phenomenon is known as “climate gentrification” and sees stakeholders with greater resources locating strategically to the disadvantage of others. Landlords have long fixated on green building standards as the primary method of addressing climate change. Retailers are also getting on board with zero-waste stores growing in popularity and consumers open to paying more for sustainable goods. While these efforts are important, the impact of climate change is being felt now and more focus and resources will need to be directed toward mitigation.

The construction industry is one of the primary contributors to climate change and will be key to mitigation strategies. As a result, real estate will shift to the centre of climate change conversations. While change can slow momentum, there is a lot of positive, new activity that could stem from environmentally friendly practices to mitigate and lessen climate change. Canadian cities must look to global best practices and be leaders in addressing important structural issues. Left unaddressed, these forces have the potential to not only slow commercial real estate momentum, but worsen incomeinequality and sow the seeds of social discord.

2020 in Context

An unprecedented bull market and supportive macroeconomic conditions have allowed the Canadian commercial real estate market to gain momentum. There are challenges, including rising rents, limited availability, new technologies and increased unpredictability; however, creative real estate solutions have allowed most stakeholders to flourish. As the market accelerates towards top speed, course corrections and market adjustments will need to be skillfully managed.

In order to retain top talent and maintain Canada’s elevated global status, cyclical concerns will need to be balanced with structural issues, including affordability and lacking infrastructure. These factors, combined with the pressing realities of climate change, will test traditional processes and built form.

There is plenty of reason for optimism. Ingenuity across our industry shows that creative solutions and resolve can make the most of challenging situations. In 2020, government, landlords and tenants must work together to create the preconditions for continued success, and embrace agility, resourcefulness and innovation. Most importantly, all stakeholders will have to broaden the scope of long-term planning. It is worth celebrating Canadian commercial real estate’s record momentum. That success was hard won. Now we must rise to the new challenges and opportunities that lie ahead.

Industrial Availability Rate at All-Time Low

Industrial Availability Rate at All-Time Low Victoria’s industrial vacancy rate ended 2019 at a record-low as e-commerce growth, B.C. cannabis production and a construction boom increased demand for distribution and warehouse space. The tightness of the market was compounded further by an industrial land crunch. The resultant scarcity of new supply coupled with strong demand looks poised to continue placing pressure on rental rates into 2020.

New Affordability Mandate at Odds with Industry

Despite concerns from the real estate community, city council implemented a new inclusionary housing policy in 2019. The policy requires that 20% of new suites, in projects with greater than 60 units, be affordable rentals. While it does include clauses aimed at aiding the financial viability of these projects, it may end up slowing new construction and reducing the supply of both market rentals and condos.


Office Conversions: Interesting but not Impactful

Stakeholders continue to look for solutions to the historically high vacancy rates in downtown Calgary. The repurposing of empty offices into other uses has been the most widely discussed solution, however challenges with this strategy remain. These include non-viable floorplates, complex construction and a lack of 100% vacant properties. While few candidate buildings may proceed, the number of viable conversions is limited and will only have a minor impact on the 11.5 million sq. ft. of vacant space downtown.

Optimism on the Oil Front

There is some optimism surrounding Canadian oil and gas moving into 2020 as the Alberta government recently announced curtailments will remain in place throughout the coming year. WTI prices have climbed into the $55 range and construction on the Trans Mountain Pipeline and Enbridge’s Line 3 Replacement are underway. That said, the capital spending budgets of many major players remain muted.

Industrial Development Cycle Coming to an End

Another industrial development cycle is coming to a close after nearly 3.2 million sq. ft. of new space was delivered in 2019. Elevated new supply has meant that, despite 12 consecutive quarters of positive absorption and a healthy market, the availability rate increased in 2019. As this development cycle subsides, elevated demand should result in the availability rate reaching an inflection point in 2020

Hot Rental Market, Hot Investment

While office development has come to a halt in recent years, cranes dominate the city with the construction of rental apartment buildings rather than commercial towers. The multifamily market has become increasingly competitive due to economic uncertainty driving homeowners to rental units, new mortgage stress test regulations limiting the ability to buy and unique amenities attracting tenants. Multifamily assets will continue to be amongst the most sought-after investments in 2020

Office Conversions: Interesting but not Impactful
Stakeholders continue to look for solutions to the historically high vacancy rates in downtown Calgary. The repurposing of empty offices into other uses has been the most widely discussed solution, however challenges with this strategy remain. These include non-viable floorplates, complex construction and a lack of 100% vacant properties. While few candidate buildings may proceed, the number of viable conversions is limited and will only have a minor impact on the 11.5 million sq. ft. of vacant space downtown.

Optimism on the Oil Front
There is some optimism surrounding Canadian oil and gas moving into 2020 as the Alberta government recently announced curtailments will remain in place throughout the coming year. WTI prices have climbed into the $55 range and construction on the Trans Mountain Pipeline and Enbridge’s Line 3 Replacement are underway. That said, the capital spending budgets of many major players remain muted.

Industrial Development Cycle Coming to an End
Another industrial development cycle is coming to a close after nearly 3.2 million sq. ft. of new space was delivered in 2019. Elevated new supply has meant that, despite 12 consecutive quarters of positive absorption and a healthy market, the availability rate increased in 2019. As this development cycle subsides, elevated demand should result in the availability rate reaching an inflection point in 2020.

Hot Rental Market, Hot Investment
While office development has come to a halt in recent years, cranes dominate the city with the construction of rental apartment buildings rather than commercial towers. The multifamily market has become increasingly competitive due to economic uncertainty driving homeowners to rental units, new mortgage stress test regulations limiting the ability to buy and unique amenities attracting tenants. Multifamily assets will continue to be amongst the most sought-after investments in 2020.




Office Conversions: Interesting but not Impactful
Stakeholders continue to look for solutions to the historically high vacancy rates in downtown Calgary. The repurposing of empty offices into other uses has been the most widely discussed solution, however challenges with this strategy remain. These include non-viable floorplates, complex construction and a lack of 100% vacant properties. While few candidate buildings may proceed, the number of viable conversions is limited and will only have a minor impact on the 11.5 million sq. ft. of vacant space downtown.

Optimism on the Oil Front
There is some optimism surrounding Canadian oil and gas moving into 2020 as the Alberta government recently announced curtailments will remain in place throughout the coming year. WTI prices have climbed into the $55 range and construction on the Trans Mountain Pipeline and Enbridge’s Line 3 Replacement are underway. That said, the capital spending budgets of many major players remain muted.

Industrial Development Cycle Coming to an End
Another industrial development cycle is coming to a close after nearly 3.2 million sq. ft. of new space was delivered in 2019. Elevated new supply has meant that, despite 12 consecutive quarters of positive absorption and a healthy market, the availability rate increased in 2019. As this development cycle subsides, elevated demand should result in the availability rate reaching an inflection point in 2020.

Hot Rental Market, Hot Investment
While office development has come to a halt in recent years, cranes dominate the city with the construction of rental apartment buildings rather than commercial towers. The multifamily market has become increasingly competitive due to economic uncertainty driving homeowners to rental units, new mortgage stress test regulations limiting the ability to buy and unique amenities attracting tenants. Multifamily assets will continue to be amongst the most sought-after investments in 2020.



Amenity-Rich Properties to Outperform

Across all asset classes, tenants are demanding more from their built premises. Landlords not adapting and ensuring that their buildings meet evolving tenant demands will be left behind. Particularly important for purpose-built multifamily rental product, amenity spaces need to be well planned to create an environment that will draw tenants.

Punitive Property Tax Increases in the City

As property taxes continue to increase in the City of Edmonton, industrial tenants have taken the lead in beginning to consider more cost-effective options, including new facilities in surrounding communities. The lower tax environments of Nisku, Leduc and Acheson can result in rent differentials of $1.00 to $2.00 per sq. ft., which can often materially impact site selection processes.

Tech Demand to Continue
With world-class AI research and development at the University of Alberta, talent is flocking to the city and boosting the footprint of the technology industry in Edmonton. Over the past five years, Edmonton has seen a 25.7% increase in tech talent, with over 28,400 technology workers in the city. This growth trajectory is expected to continue and will be a main driver of the office market.

Alberta’s Industrial Heartland Gains Momentum
Located northeast of Edmonton, Alberta’s Industrial Heartland is rapidly becoming a leading industrial market to watch. Home to over 40 companies in a variety of sectors including manufacturing, oil, gas and petrochemicals, the Heartland has received over $40.0 billion of investments. With two multibillion-dollar petrochemical plants under construction, continued growth in this area will have positive spillover effects for service companies in the region.

Flight-To-Quality Wave to Hit in 2020
New Class AA office space at River Landing has triggered a flight-to-quality for many of Saskatoon’s marquee tenants. With the first of two new office towers slated to open in early 2020, we will begin to see the impact on second-tier product as tenants shuffle and relocate into upgraded space. It is anticipated that vacancy will rise in the short-term with few tenants lined up to backfill aging product.

Industrial Market Finds Its Footing
Building on steady improvement in recent years, the Saskatoon industrial market continued to make gains in 2019. Due to limited new construction and rising tenant demand, the market has been able to rebalance from the last wave of construction and decrease availability to a healthy 8.0%. With rents holding steady at $9.50 per sq. ft., there remains significant runway for future growth.

Mixed-Use Development on the Rise
Hoping to replicate the success of No.1 River Landing, several developers have announced plans for mixed-use projects in Saskatoon. Supported by strengthening demand for new apartments and condos on the downtown periphery, 2020 will see construction begin on a 17-storey, mixed-use condo project on Broadway, while plans have been announced for multiple towers on either side of University Bridge.

Uncertainty Remains in the Regional Economy
Maintained softness in commodity and oil prices continues to create uncertainty for Saskatoon’s economic outlook, leading to caution in the real estate sector. However, and in spite of the challenging landscape, a conservative development pipeline across asset classes has allowed market fundamentals to stabilize.

Industrial Market Rebound
After years of economic uncertainty, the tide has started to turn on Regina’s industrial market. Development has slowed amidst high land and construction costs, allowing the market to absorb much of the excess industrial supply. Meanwhile, a more stable availability rate in 2020 should relieve the current downward pressure on rents, which have steadily decreased from their peak since 2016.

Inflow of Capital from Out-Of-Province
Across asset types, quality product is being traded in Regina at a premium relative to comparable assets in neighbouring provinces. With Class A product achieving cap rates above 7.0%, and Class B and C assets over 8.0%, Regina has seen a significant amount of capital flow in from out-of-province as investors seek higher returns across Saskatchewan. This trend is expected to continue into 2020.


Lingering Effects of Flight-to-Quality
Regina’s office market remained relatively stable in 2019 despite softness in commodity pricing. The market has seen a significant flight-to-quality in recent years which has resulted in Class A vacancy dipping below 4.0% as Class C has neared 30.0%. With limited tenants to absorb dated product, landlords have been forced to offer increasingly aggressive incentives to fill Class B and C space.

Cost-Effective Opportunity at the GTH
The Regina Bypass is expected to boost accessibility and growth at the Global Transportation Hub (GTH). Located west of Regina, the GTH is an 1,800-acre industrial and logistics park with direct access to Canadian Pacific’s main rail line. With 679-acres of serviced land available at $256,000 per acre, the GTH offers competitively priced land at roughly half the cost compared to within city limits.

Rising Industrial Rents Improving Feasibility of New Construction
As tenants become acclimatized to new highs in rental rates, expect to see more industrial construction in 2020 that will finally bridge the gap between existing inventory and muchneeded new supply. With some renewal rates approaching $11.00 per sq. ft. and new construction rents commanding about $12.00 per sq. ft., users are taking a harder look at new developments and build-to-suit opportunities.


Glut of Downtown Vacancy Permeating Downwards to Class B
With the new 365,000 sq. ft. office tower at True North Square (‘TNS’) nearly 100% leased, a glut of office space is working its way through the downtown market. With overall absorption rates expected to remain anemic, the Class B market will experience the next chapter of the TNS effect. Further impacting this are the proposed Portage Place Shopping Centre redevelopment and the amalgamation of Wawanesa’s offices into the newly announced fifth tower at TNS.

Once a Revitalization Dream, Now a Starring Role
The Sports, Hospitality and Entertainment District (SHED), once an urban revitalization dream, is now a very real and vibrant new district. The SHED is coming alive with tech tenants like SkipTheDishes, high-end hotels such as Sutton Place, food halls and new purpose-built rental towers. Additional investments along the fringes of the district are expected to exceed $400.0 million over the next five years.

Stability is Attractive in Times of Uncertainty

Debt and equity markets are anticipated to increase asset allocations to real estate and investors seeking to recalibrate geographic allocations or asset mixes will look to Winnipeg. Industrial, apartment and mixed-use properties will remain in demand in 2020 with emphasis on assets with strong rent upside potential.

Population Growth to Fuel Residential Construction
Windsor made headlines in 2019 after recording some of the largest rental and residential sale price gains in the country. Fuelled by population growth, expect residential construction activity to continue at full steam in 2020 as a record number of building permits will add to the 1,700 multifamily units currently proposed or under construction.


Industrial Stability Ahead
The development pipeline is anticipated to moderate slightly in the year ahead after an influx of existing options hit the market in 2019 and raised the availability rate to 3.2%. On the demand side, continued stability is expected as industrial users look to take advantage of new, high-quality inventory now available.

Office Market to Tackle Vacancy
Highlighted by a lack of modern office offerings, well located Class A and B suburban properties are expected to drive rent premiums in 2020 with limited quality options over 5,000 sq. ft. In contrast, the downtown office market could see strong municipal support for residential conversions, providing relief to the persistently elevated Class C vacancy rate.
Gordie Howe Bridge Construction Continues
Construction started on the $5.7 billion Gordie Howe International Bridge in 2019. Considered to be the most significant infrastructure project in the region’s history, the 2.5-kilometre bridge will span six lanes and create over 2,500 jobs. Expect capital to target residential, industrial and land assets in the region as the project nears completion in 2024.

Multifamily Pipeline to Change Downtown
Skyline Developers are pushing ahead with new high-rise developments that will change London’s downtown skyline. Forecast to deliver 1,300 new units with another 2,000 in the planning and permitting stages, this development cycle is expected to boost population figures in the city’s core. In turn, this should help to increase the performance of all assets and lead to greater investment activity.


Velocity in the Investment Market
London experienced strong levels of investment activity in 2019 with the top 20 deals totalling nearly $350.0 million in value. Investors will continue to be active throughout 2020 with larger institutions taking advantage of market conditions and disposing of non-core holdings in London, often purchased by smaller private capital buyers.


Solid Office Leasing Activity to Continue
Following the completion of several lease transactions over 20,000 sq. ft. in 2019, London’s office market is poised to build on current momentum with a number of large deals in the pipeline for 2020. Leasing activity is expected to remain high as landlords look for creative opportunities to further stabilize assets.

Record Investment to Build on Industry Diversity
Historically tied to the manufacturing and automotive industry, London’s economy has diversified since 2008 with the rise of the city’s technology, food production and defense sectors. This is highlighted by Maple Leaf Foods’ new $660.0 million poultry processing facility, which is the largest single food production investment in Canadian history. This plant will employ 1,450 people and generate $1.2 billion of annual economic activity once operational in 2021.

Industrial Developers to Capitalize on Market Conditions
Strong fundamentals across Waterloo Region have led to record-low availability rates and accelerated rent growth. Spurred on by current conditions, new speculative construction in the pipeline has developers looking to capitalize on the bottleneck of demand in 2020 and 2021 amidst limited market opportunities. Given recent growth, a robust labour pool and highway accessibility, the industrial market is forecast to continue to perform well in 2020.

Injection of Best-in-Class Product on the Horizon
With no new supply added to the office market since 2018, Waterloo Region is seeing growth through exciting new construction developments. Highlighted by 345 King West by Perimeter and Fiera Properties and GloveBox (fall 2021 occupancy), these projects, both in Kitchener’s Innovation District, will bring best-in-class product to the Region, exemplifying market confidence and the prospects of future growth.

Downtown Kitchener Going Higher
New downtown high-rise developments continue to reshape the landscape of the Region, particularly in Kitchener with over 3,000 residential units in the development pipeline totalling approximately $700.0 million in value. New projects have been well received by the market, as demonstrated by the success of advanced unit sales and a deep buyer pool.

Land Pricing and Investment Volumes on the Rise
Shrinking supplies of developable land across the Greater Toronto Area (GTA) have made Waterloo Region an enticing market for developers and investors. The recent success of new builds throughout the Region, a healthy price spread against the neighbouring suburban GTA market and a competitive and growing investor landscape are set to compound the current growth of land pricing and investment volumes further in 2020.

New and Rejuvenated Industrial Product to Benefit Market
Industrial availability and rental rates will rise in the short-term in response to projects that will modernize inventory. Stelco is subdividing and revitalizing their existing property, meanwhile one of the largest owners in the Bayfront Industrial Park is rejuvenating over 700,000 sq. ft. of underutilized space. New spec construction in the Airport and Stoney Creek Business Parks is also expected to deliver in 2020. This activity is a welcome occurrence for the market demonstrating the commitment of owners to attracting modern manufacturing businesses.


Tech Companies Increasing Interest
Affordable living and an appealing arts and culture scene are attracting Millennials to Hamilton. With lower operating costs as an added benefit, technology companies are following the talent to the city. Recent announcements include Q4 Inc., a Toronto-based software company, which is expanding operations to Hamilton and bringing 140 new jobs to downtown.


Raised Questions Around Cancelled LRT
Metrolinx cancelled Hamilton’s proposed LRT in late 2019 and left many wondering what would happen to the properties purchased along the route. Investors who purchased into the corridor did so with the expectation that the LRT would bring higher density developments. The City is now waiting for the five-person task force to determine how the $1.0 billion provincial transit and infrastructure funds will be spent.

Made in Hamilton Solution
The City of Hamilton is reviewing proposals to modernize and repair the aging FirstOntario Arena and Convention Centre in downtown Hamilton. Two local groups have made pitches offering new facilities including residential, commercial and hotel uses, with one group suggesting their concept could be completed in 12 to 14 months.


The Challenge of Planning for Office Space Needs
Tight downtown market conditions have placed pressure on office rents to the point where at times they approach spot pricing. While users must act quickly to secure space, the accelerated pace of change has made forecasting headcount growth increasingly difficult.

Record New Supply Remains Insufficient
Despite industrial development at record levels, it remains insufficient to satisfy the pent-up demand in the market. A lack of available space due to preleasing will drive further rent growth with new demand to come from the industries that cannot locate away from the city.

Retailers Trim Portfolios to Secure Premier Locations
Retailers have become more strategic by shedding smaller, second-tier stores in favour of premier destinations, particularly in top-performing urban malls. In turn, savings from a trimmed portfolio are being put towards securing high-quality locations.

Premier Destination for Global Capital
Toronto was once again the nation’s most active investment market in 2019. While the city continues to benefit from its status as a global safe haven, investor interest is increasingly being driven by the sector’s performance and potential for income growth.

Land Activity to Surge on Development Demand
The land market is set to be the most active in recent years as buyer confidence returns. Housing affordability issues are driving demand and residential development and periphery markets with serviced land near high-order transit will see strong growth.

Alternative Asset Classes Thrive
Liquidity for non-core asset classes like seniors housing and hotels has grown recently. Well-capitalized investors expanding their search for yield, an institutionalized marketplace and strong fundamentals will place pressure on pricing in these sectors into 2020.

Aging Federal Government Inventory
Almost 30% of the Federal Government’s owned buildings in Ottawa are rated in “critical” or “poor” condition according to a recent Federal Government report. The amount of space contained within these buildings represents over 14.3 million sq. ft. of office space that will require significant renovations. With Ottawa having a total compliment of only 2.6 million sq. ft. of vacant office space, we anticipate that the Government’s need for functional space will be a continued driver for absorption and growth.


Continued Tech Growth
Ottawa’s technology sector continues to see two-pronged growth in the city divided between the downtown urban tech hub and the Kanata suburb. The downtown core is expected to see few large blocks of space come to market in the short-term that will provide growth opportunities in the core. Conversely, Kanata is experiencing a lack of space to
accommodate existing requirements. With only about 400,000 sq. ft. of vacant space, the 600,000 sq. ft. of active new tenancies will face a space crunch requiring the construction of new buildings to fully meet occupier demands.

Industrial Rent Growth Needed for More Development
The industrial market continues to perform well with little available space, strong demand and rising rents. While rental rates reached record levels in 2019, they have not yet reached a point that supports new construction. As such, further increases in rental rates are needed before new development becomes financially feasible. Given the significant rent growth seen in the last few years, it will be interesting to see if tenants are able to absorb these required increases or whether they will search for opportunities outside of the urban boundary.

Montreal’s Industrial Market Heats Up
Montreal’s industrial market looks poised to test record occupancy and pricing levels in 2020 due to continued strong leasing activity and pent-up demand. New mid-bay product is expected to kick-off on spec to serve growing distribution and logistics requirements, with Amazon’s new facility acting as a cue for others considering establishing fulfillment or last-mile facilities in the Greater Montreal Area (GMA).

No End in Sight for Elevated Office Demand
Alongside expanding local users, a variety of new tenants are entering the GMA office market and driving activity for midsized spaces. Widespread demand for access to Montreal talent is anticipated from knowledge-based companies as the City solidifies its standing as an international tech hub for AI and gaming. Upon completion, the REM will increase connectivity across the GMA and should spur suburban growth.

Investment Market to Carry Positive Momentum into 2020
Boosted by solid market fundamentals and a healthy economic outlook, Montreal’s investment market will remain active in 2020 across all asset types. Multifamily product will be highly sought-after, land prices in the core are expected to approach all-time highs and the limited availability of industrial assets will require investors to be creative and flexible if they wish to access the market.

20-20-20 Rule & REM to Reshape Housing Across the GMA
Coming into effect in 2021, the controversial 20-20-20 rule will promote the construction of social, affordable and family housing in new residential projects in Montreal. Projected to raise condominium prices by 15%, additional impacts are likely to include urban projects shifting to higher densities to curb costs and an increased interest in suburban areas not subject to the rule. The greatest beneficiaries will be REMadjacent sites in the South and often overlooked East.

E-commerce Driven Industrial Demand Gaining Ground
Aimed to serve online order processing, Simons’ new 1.1 million sq. ft. fulfillment centre is scheduled for delivery in early 2020. Stemming from the growth of e-commerce, further tenant demand is expected. For their part, Simons will leverage their expertise in collaboration with the Ministry of Economy, Science and Innovation to transform their existing distribution centre into a multi-client e-commerce accelerator.

Quebec Reinforces its Position on the Canadian Scene
A testbed for Canada’s first pre-commercial 5G wireless network, Quebec City continues to garner attention on the tech scene. Key industries, including IT and communications, video and digital gaming, and the lucrative life sciences technologies, will lead to greater office momentum as local companies look to grow at a fast pace and expand operations.

City Aiming to Release More Industrial Product
With the market’s availability expected to hover around 2.0% in 2020, the City will begin to explore options aimed at solving issues around the current scarcity of developable land and lack of industrial product. This will include completing feasibility studies targeting lands near the airport, as well as evaluating and earmarking existing industrial parks for potential redevelopment.

Future Tramway System to Boost Market Appeal
Funded by all levels of government, the $3.3 billion restructured transport network is expected to be operational by 2026. Expanding on the existing bus route, the new system will connect the city through a new 23-kilometre tramway line and 15-kilometre ‘trambus’ route. The system will increase the workforce’s mobility, support immigration and boost the city’s appeal to employees, tenants and landlords alike.

Tech Talent
Halifax ranked #11 in CBRE’s 2019 Tech Talent report, with the city scoring well in quality of tech labour, number of tech and tech-related degrees as well as educational attainment. Through tech initiatives and incubators such as the $300.0 million Ocean Supercluster and the Creative Destruction Lab Atlantic, significant capital and resources are being deployed to stimulate growth in the technology sector.

Halifax’s Dated Downtown Office Stock
Halifax faces the ongoing challenge of an aging downtown office inventory. In the central business district, 82.8% of office inventory was built prior to 1990. Also, Halifax’s Class B product accounts for 55.2% of downtown office stock, the second highest amongst major Canadian markets. Landlords and developers are actively re-assessing the highest and best use for aging office assets in the core which will impact office demand in the coming years.

Tight Industrial Market
The industrial market continues to tighten at an impressive rate, recording three consecutive years of over 200,000 sq. ft. of positive net absorption. Since Q4 2016, the availability rate has dropped from 11.6% to 6.7% in Q4 2019, despite adding over 400,000 sq. ft. of new inventory over the same period. With a lack of new supply, it is expected that rental rates will continue to increase.

Multifamily Vacancy at an All-Time Low
Multifamily vacancy rates reached a historic low of 1.0% in 2019. Developers are taking advantage of market fundamentals as the rental market continues to gain momentum. CAPREIT recently announced that they have purchased 1,503 apartment units in eight multifamily properties for $391.0 million from QuadReal, marking the largest real estate transaction in Halifax’s history.




A first-time homebuyer’s guide to condo boards


If you’re the type of person who loves vaping indoors and engulfing your apartment balcony in festive lights, condo living might give you a culture shock.

With the price of detached homes so incredibly high, condominiums are an attractive prospect for first-time buyers. Sure, there’s reduced square footage and maybe a little less privacy, but for a lower price point and fewer maintenance responsibilities, condos are a great option for wannabe urban dwellers. That is, unless, you’re not comfortable living with a few house rules.

Single-family homes and condos are very different when it comes to ownership. When you buy a home, you solely own the property and are responsible for all of its expenses and maintenance. With condos, however, you only own the interior of your unit, and maybe a parking space.

The rest of the building — the pool, the concierge desk, the hallways — are shared collectively. To govern how these places are used, and to set the ground rules for the building community, is the condo board. Every board is unique, and every building and its rules are unique too, so when hunting for a condo, buyers need to carefully consider if a building and its standards are right for them.

“People need to think about what they want to do in their unit, and then look to the documents to see if there’s any restrictions, for general noise and nuisance,” says Denise Lash, founder of Lash Condo Law.

Here, Lash breaks down what you should know about condo boards and the kind of rules you can expect to encounter.

The who’s who in condos
In the makeup of a condo community, there are a few key players — the condo board of directors, the condo management and the owners.

Condo boards are responsible for the general operations of the building on behalf of the owners, and make the big decisions in regards to the building rules, bylaws, maintenance and finances. Condo boards must also enforce compliance with provincial legislation, such as Ontario’s Condominium Act. The condo board is made up of volunteers, usually owners in the building, who are elected into power by fellow condo owners.

To ensure that the building operates smoothly on a day-to-day basis, the board will enlist the services of a professional management company, that will look after repairs, fee collection and respond to complaints, among other duties. In the case where a board does not hire a management company, they self-manage, but it’s not commonplace.

“These days, because of the potential liability, and all of the requirements of the [Ontario] Condo Act, few are self-managed condos,” explains Lash.

From occupancy bylaws, to the place where your dog uses the toilet, condo boards have the most power when it comes to setting rules, though it isn’t a total dictatorship. While owners can’t break condo rules without penalization, they can choose to vote against new rules and bylaws in owners meetings, or try to remove the current directors if they’re unhappy with their practices.

“The board, ultimately, they’re the decision makers, and if they pass rules, there’s an opportunity for the owners to vote against it,” says Lash. “But other than that, if they really continue to be unhappy with the way the board is conducting itself, there’s a process for removing the board members, and that is called a requisition.”

Pulling off a successful requisition is hard to do compared to voting against rules. For cautionary pre-purchase measures, you should always review a snapshot of the building prior to buying with the help of property documents like the Status Certificate and the condo’s declaration. The declaration will offer details about common expenses, amenities, pet allowances and shared spaces, known as common elements. The status certificate also touches on rules, but primarily provides a summary of the financial health of the building, including the reserve fund and fee increases.

“That’s the document that says whether the board, the corporation, is contemplating any increases in the budget,” says Lash. “So you’re buying and you go, ‘Oh my gosh, the roof has to be repaired and there’s no money in the reserve fund.’ That’s really important from a purchaser’s perspective, to see if there are potential increases.”

All documents, Lash stresses, are important to review with your lawyer before buying.

There are house rules, plus balconies
Every condo community has a different set of regulations, and these laws are always evolving. Policy changes that take place outside of the condo influence the kind of rules you’ll encounter as an owner, from new local zoning rules up to federal legislation.

When cannabis was legalized, for example, Lash explains that condo boards had to decide how they would manage the consumption and growth of plants in their buildings, which in some cases prompted condos to go completely smoke-free. From a purchaser’s perspective, it’s important to recognize these rules prior to purchase so lifestyle and bylaws don’t collide.

“If you want to be a casual cannabis smoker, you have to review the declaration, but more importantly, the rules, that’s where it usually is,” says Lash. “And when it says, ‘No smoking cannabis in the unit,’ and you really want to smoke, then this is not the building for you.”

Other rules that commonly trip up new condo owners are common elements. In the declaration, there are specifications as to what these shared spaces are, and not all of them are obvious. A balcony, for instance, is considered a common element with exclusive use, meaning that while only the owner has access to it, the balcony must still comply with common element rules.

“There’s reasons why you want people to remove Christmas decorations after a certain date — because of the appearance,” says Lash. “If somebody is selling their unit, what does it look like with all of these Christmas lights out in April or May? They want to control the appearance from the outside and also [for] liability reasons.”

Your puppy can’t live here
No one possesses magical foresight into the future, but when buying a condo, Lash explains that it’s important to consider your plans and lifestyle for the space.

Are you a young couple hoping to start a family one day? Some condos have a two-people-per-bedroom bylaw. Dreaming of renovating the kitchen? Watch out for building regulations. Even if you plan to get a pet one day, make sure the condo will allow them to stay under breed and size restrictions, especially when your furry friend grows up — it’s not unheard of for puppies to one day outgrow weight bylaws.

“You’re in love with your puppy, [then] six months later, you’re getting a board letter — a legal letter — saying remove in two weeks,” says Lash.

Rules are put in place for the safety, comfort and security of everyone in the building, and while it’s nearly impossible to achieve perfect coexistence between everyone, bylaws strive to achieve that balance.

7 historic Toronto sites that are being reimagined as condos

Across downtown Toronto and beyond, there are remnants of history all throughout. Whether it’s a warehouse converted into lofts, or an old building torn down and replaced, the old makes way for the new one way or another.

Some historic buildings see the wrecking ball, and others are preserved in a new design. Here are a few notable sites with historic value that are expected to be envisioned as future condos. All of these projects are currently preconstruction and in the building approval process.

1. 250 University Avenue Condos

Fronting Toronto’s bustling University Avenue, this eight-storey building was originally constructed in 1958 for The Bank of Canada to store gold and cash reserves. The BoC’s offices have since moved across the street to Sun Life Financial Tower. Northam Realty Advisors and IBI Group are proposing to use the half-century-old building as a podium for a highrise, which will feature 495 units across 54 stories.

2. Designers Walk Condos

BBB Architects has a unique vision for the Designer’s Walk community along Davenport Road. The well-known strip of brick-clad showrooms in the Annex and Yorkville neighbourhoods has been attracting design professionals since its inception in the 1980s. Now, a build proposal reimagines the area as a 92-unit mixed-use highrise with trees budding from the balconies and an expanded commercial centre.

3. Bloor & Dufferin Condos

Established in 1925, Bloor Collegiate Institute has seen many students come through its doors at Bloor and Dufferin Street. In 2016, the land that the high school shares with Kent Public School was sold to developers Capital Developments and Metropia, who plan to convert the area into a master-planned community with public spaces and over 2,000 residential units.

4. 335 Yonge Street Condos

Located just off the Ryerson University campus, this little rectangle of land has a historical past. Until 1855, a bakery and grocery store operated on the site in a two-storey building, owned by Williams Reynolds. It was later converted into a hotel, known as the Edison Hotel, which would stay open through various owners and rebrands until the 1970s.

In 1974, 335 Yonge Street was added to the City of Toronto’s heritage property list, prior to being used for a number of commercial purposes, from a Salad King location to various retail spaces. A portion of the 19th-century commercial building collapsed in 2010, before it was KO’d by fire and eventual demolition in 2011. Now the area serves as a food market for feeding hungry students and bypassers. The Lalani Group has proposed to revise the lot into a 165-unit condo tower.

5. 2500 Yonge Street Condos

When Capitol Theatre first opened its doors in 1918 at Yonge Street and Castlefield Avenue, it was the go-to local spot for vaudeville shows and silent films. In 1933, the 1,300-patron theatre was renovated to exclusively cater films, before further renovations and the addition of a concession stand were made throughout the decades. After closing down in 1998, a $2 million renovation revitalized the theatre into a special event venue, renamed the Capitol Event Theatre, and retaining most of its 1910s charm.

After the block sold in 2015, a proposal was put forward to re-establish the site as a 14-storey condo development. Judging by the renderings, the old facade of the theatre is kept intact.

6. Mode Condos

Lining the east side of Church Street between Shuter and Dundas Street, are four Georgian-style row houses. According to Toronto Architecture: A City Guide, published by journalist Patricia McHugh and architecture critic Alex Bozikovic, the row houses were built in 1852 before being reconstructed after a fire a few years later. Number 195 in the row was demolished and rebuilt in the early 1980s. The site is currently on the city’s heritage register.

CentreCourt has plans to top the rowhouses with a more modern concept — a 37-story condo development with 464 units.

7. 2440 Yonge Street Condos

At the intersection of Roselawn Avenue and Yonge Street, just north of Yonge and Eglinton, there once stood a 110-year-old Bank of Montreal building. In January 2017, the two-storey brick building, constructed in 1907, was suddenly torn down.

On the site, developer Main + Main hopes to build a mixed-use development with 2.1 acres of commercial and residential space, including 687 condo units.

Investor demand for new Toronto condos spiked in 2019: Urbanation

It was a great, though not quite record-breaking year for the GTA new condo market.

There were 25,097 new condo units sold across the region in 2019, the third highest annual total on record, according to data released this week by housing data consultants Urbanation. This total represents growth of 27 percent over the previous year, with a pronounced spike in the final months of the year that nearly broke a new condo sales record for the fourth quarter (it was off by about 700 sales).

One of the most impressive figures released by Urbanation was the surge in units sold in newly launched condo projects in 2019. There were 18,232 units sold in developments that launched last year, a 17 percent increase over newly launched units sold in 2018.

In a media release, Urbanation President Shaun Hildebrand noted that this is a “good indicator of growth in demand from investors, who tend to be most prevalent within newly launched projects.”

Hildebrand also observed that end-user demand also rose dramatically in 2019, with the strength evident in the number of units sold in projects that had launched in years prior but were still on the market. There were 6,865 units in projects launched before 2019 sold last year, a spike of 70 percent when compared to the previous year.

Unsold new condo inventory in the GTA declined year-over-year to 13,373 in 2019, which according to Urbanation, is below the 10-year average for the region. The firm also noted that new condo inventory fell to 6.4 months of supply, well below the 10-month level which is considered “balanced.” With inventory consistently not meeting buyer demand, prices for available units rose to a record high of $1,073 per square foot. Hildebrand wrote that this means new condo prices have effectively doubled over the last 10 years.

When it comes to trends to watch for 2020, the key data point is how a potentially record-breaking number of condo unit completions will impact the market in the months ahead.

The approximately 29,500 new condo units scheduled for completion in 2020 is twice the number of units completed in 2018, according to Hildebrand. The current record-holder is 2014 with 21,000 completions, so 2020 is expected to top that figure by a considerable margin.

Why are all of these completions hitting at once? Hildebrand wrote that years of low condo unit completions and high construction starts meant that by the end of 2019, there was a record of 78,112 units at various stages of construction across the GTA. Many are set to be completed in 2020. 

Toronto home prices just posted biggest annual increase since October 2017


The Toronto region housing market is getting tighter as homebuyer demand ramps up and supply continues to slip.

These conditions, which emerged last year following a months-long slump, have kept up into the new year and are now pushing prices up at the fastest rate in over two years.

The recently rebranded Toronto Region Real Estate Board (TRREB) announced today that the benchmark price of a home in the region was up 8.7 percent in January, the highest annual growth rate seen since October 2017. The condo resale market led the way in price growth, but all property types saw strong growth above 7 percent when compared to year-ago levels.

TRREB’s market analysis team’s commentary can be summed up in one statement: What a difference a year makes.

“It is clear that many buyers who were on the sidelines due to the OSFI stress test are moving back into the market, driving very strong year-over-year sales growth in the detached segment. Strong sales up against a constrained supply continues to result in an accelerating rate of price growth,” said Jason Mercer, TRREB’s Director of Market Analysis and Service Channels, in a media release.

Beyond homebuyers adjusting to the stricter mortgage stress tests, TRREB’s team chalked up the strong showing to solid market fundamentals, including low unemployment, population growth and favourable mortgage rates.

The Toronto region’s 4,581 home sales in January were up over 15 percent compared to a year ago. Sales last month also rose 4.8 percent over December 2019’s total.

We can anticipate more of the same for 2020, with interest rates remaining steady (or potentially dropping) and the federal government expected to introduce more financial support for first-time homebuyers.

GO ridership from Kitchener jumps 40 per cent, Metrolinx report says
The number of people boarding GO trains and buses in Kitchener has jumped 40 per cent between April and December of 2019, a new report from Metrolinx says.

In a blog post, Metrolinx says there has been record-breaking ridership numbers for GO Transit. A full report is expected to be presented at the Metrolinx board meeting on Thursday.

In Kitchener, the average daily ridership is 328 people. Between April and December 2019, there were more than 64,000 riders.

As well, Guelph saw an increase of 20 per cent of riders during the same time period while Acton, the next stop on the line, saw a 15 per cent jump.

Metrolinx said the increase of ridership is due largely to increased offerings both during rush hour and at other times of the day. In September 2019, Metrolinx added 84 more weekly trips to the line.

Metrolinx CEO Phil Verster says he's not surprised by the increase.

"I've always said very publicly it's one of my three or four top objectives to increase GO services along the Kitchener corridor because that corridor is so economically important for the region," he said. "There's huge demand."

Need for trains 'can't be denied'
Waterloo Mayor Dave Jaworsky says he hopes these numbers will encourage Metrolinx to invest more on the Kitchener GO line.

"I think the need for all-day, two-way GO train service to Kitchener-Waterloo can't be denied," he said. "I think that these growth numbers certainly show that if you build it, they will come."

The increase in ridership, plus news from Statistics Canada that shows the census metropolitan area of Kitchener-Waterloo-Cambridge is the fastest-growing in the country, shows just how much need there is for the service, he said.

Jaworsky says he believes the numbers also reflect the economic benefits of investing in the line and that having two-way, all-day GO trains will benefit both Toronto and Waterloo region.

The numbers show "if you build it, they will come," he said.

"The more that they build, the quicker that they can get it done, the sooner we can all see even more benefits."

An email from Metrolinx media relations to CBC Kitchener-Waterloo said that Metrolinx "continues to target 2025 as the start date for two-way, all-day service." A new timeline for two-way, all-day GO was also approved by the Metrolinx board in November and it says the goal is to have service by 2025.

But Vesper would not confirm that date and said they are not publicly giving a date for the start of service.

He said they can't give a date because there are contracts that need to be approved and awarded to do work along the corridor.

"There's no way we can confirm a date at this stage but rest assured we're targeting a date as soon as possible," he said.
Canada's population growth is concentrated to just three cities
The lion’s share of Canadian population growth last year was just in three markets: Toronto, Montreal, and Vancouver.

Recent data from Statistics Canada showed that the total urban population increase nationwide was 463,424. Toronto had the largest urban increase with 127,575 new residents in 2019. This pushed the city’s total population up to 6,471,850.

On a regional basis, the Kitchener-Cambridge-Waterloo area saw the strongest upward movement with its 2.82% annual gain, reaching a total of 584,259 people last year.

Ontario’s strength is further fuelled by the fact that nearly half of all immigrants to Canada in the year ending September 30, 2019 went to the province, StatsCan said. This amounted to approximately 209,200 newcomers, compared to the 89,400 that went to Quebec and the 65,000 that chose British Columbia.

Montreal posted the second strongest urban increase with 65,205 new residents, pushing up the total to 4,318,505. Vancouver had 39,045 people added to its population last year, reaching 2,691,351 residents.

Population growth impelled by intensified inbound immigration to Canada is driving an unprecedented housing boom, according to a recent analysis by Dominion Lending Centres chief economist Sherry Cooper.

This demand for more housing is also stimulating a greater need for professionals like construction workers and electricians – industries that are seeing an increasing proportion of immigrants, Cooper added.
Canadian home sales and prices rise 11 per cent compared with a year earlier
OTTAWA - The Canadian Real Estate Association says home sales rose 11.5 per cent in January compared with a year earlier to reach the highest sales figures for the month in 12 years, even as new listings remain constrained.

The association says seasonally-adjusted sales fell 2.9 per cent in January from a month earlier, dragged down by a roughly 18 per cent drop in sales in the Lower Mainland of British Columbia.

The actual average price for homes sold in January was about $504,350, up 11.2 per cent from the same month a year earlier for the largest increase since mid-2016.

Removing the Greater Vancouver Area and Greater Toronto Area from the picture, the national average price falls to around $395,000.

Home prices declined slightly in Greater Vancouver and in Prairie cities, while Montreal and cities in Ontario saw strong gains.

Prices rose as new listings remain near decade lows, though they edged up 0.2 per cent in January from December.

This report by The Canadian Press was first published Feb. 14, 2020.
GTA Rental Market Overview
Higher rent growth in primary rental market
Rent growth, GTA
Above Average Rent Growth in KCW, Ottawa, Windsor & Northern Ontario
Common Sample 2-bed apt rent – % chg.
 Turnover rates lower in most markets
Turnover rate (%)
Vacant unit rents are on average 25% higher
Toronto CMA average rents ($)
Rental supply is increasing
Rental apartment completions as a share of condominium apartment completions
Newer primary rental units charge similar rents as condos
City of Toronto (Zone 1-4)
Cadillac Fairview Purchases East Harbour Project from First Gulf

TORONTO, Sept. 13, 2019 /CNW/ – Cadillac Fairview and First Gulf are pleased to announce that Cadillac Fairview has entered into an unconditional purchase agreement with First Gulf and its partners to acquire 100 per cent ownership of Toronto’s East Harbour project, a 38-acre site three kilometers from the city’s downtown core, with the objective of completing the plan to create a vibrant destination and new eastern commercial core. This transaction is expected to close on September 25, 2019.


The vision for this ambitious master-planned commercial hub was conceived by First Gulf and its partners, Cowie Capital Partners Inc. and Northglen Investments. In 2018, Toronto City Council approved the East Harbour Master Plan, which provides for 10 million square feet of commercial development, including office, hotel, retail, institutional, entertainment and cultural space. With the capacity to accommodate over 70,000 employees, future growth potential for the site is supported by a planned multi-modal transit hub incorporating GO Train/SmartTrack services, TTC light rail transit and the future Ontario Line subway.

“CF is thrilled to assume stewardship of the East Harbour project and all of the tremendous potential that it represents,” said John Sullivan, President and CEO, Cadillac Fairview. “Our commitment now is to sustain the momentum toward realizing the vision of a vibrant new employment and entertainment destination for Torontonians.”

First Gulf CEO David Gerofsky stated “On behalf of First Gulf and our partners, I am extremely proud of how we brought this project to life and established support for it. The shared vision, developed in collaboration with community and government stakeholders, establishes East Harbour as a key driver of economic growth and competitiveness for Toronto. We know the project is in good hands with Cadillac Fairview and we look forward to seeing our collective work realized.”

CF has been successful in acquiring and developing lands adjacent to a city’s traditional financial core, seeding investment in high-potential districts. The company has deployed this core-shifting strategy in downtown Toronto by initiating the development of the South Core with a combined five-tower scheme, including Maple Leaf Square, ICE condominiums and the last building, the 16 York Street office building currently under construction. This strategy has been successfully employed in Montreal with the creation of Quad Windsor, CF’s $2 billion development plan, which includes the revitalization of Windsor Station, five residential towers (featuring Tours des Canadiens 1, 2 and 3), and two office towers including Tour Deloitte, which opened in 2015.

Mr. Sullivan points out that CF’s role in stimulating economic activity in those hubs is based on a solid understanding of market fundamentals and the need for smart, sustainable development: “The City of Toronto has forecast the need for some 45 million square feet of additional commercial space to accommodate 300,000 employees by the year 2041,” he said. “There are very few development sites in the traditional downtown to absorb this kind of growth and East Harbour is a perfect means to extend the city core.”

CF Executive Vice President of Development, Wayne Barwise, sees the project as representing an exciting integration of transit connectivity, smart urban planning, advanced building technologies and environmental sustainability.

“Establishing East Harbour as an employment destination with multiple uses and amenities will be based on infrastructure that is well-integrated with its surroundings, well-connected with a range of transport options, resilient to long-term changes in the economy and our climate, and responsive to innovations in building systems technologies,” said Mr. Barwise, who is predicting the development program to span in excess of 10 years.

The first phase of the development is the adaptive reuse of the existing Soap Factory building, which is a defining element of the overall plan. Cadillac Fairview is currently in discussions with prospective tenants who have expressed interest in this unique opportunity.

As one of largest office complexes in the country, East Harbour’s transit infrastructure will connect to the Lakeshore and Markham/Stouffville GO Train lines that currently travel past the site as well as to the future Ontario Line subway, SmartTrack services and TTC light rail transit. The hub will have the capacity to serve an estimated 32,000 GO patrons per hour and help alleviate bottlenecks at Union Station by providing the potential to meet growing demand.

With sustainable innovation and the needs of a knowledge-based workforce guiding the project’s design parameters, CF will create space for an affordable employment incubator for the City of Toronto and provide an estimated 30,000 square feet of space for a non-profit community use.

East Harbour also integrates close to nine acres of green space with a network of streets, plazas, sidewalks and open spaces to create an environment where people can relax comfortably and move efficiently. Development plans are based on the latest principles of sustainability and well-being, creating a walkable, bikeable network of paths, bridges and connectivity to public transit.

Intelligent building design with smart building strategies will enhance long-term operational efficiency, with LEED and WELL certifications targeted throughout East Harbour. The project will also implement part of the Don Mouth Naturalization project to provide permanent flood protection for the area.

About Cadillac Fairview

Cadillac Fairview is one of the largest owners, operators and developers of best-in-class office, retail and mixed-use properties in North America. The Cadillac Fairview portfolio is owned by the Ontario Teachers’ Pension Plan, a diversified global investor which administers the pensions of more than 327,000 active and retired school teachers. The real estate portfolio also includes investments in retail, mixed-use and industrial real estate in Brazil, Colombia and Mexico.

Valued at around $31 billion, the Canadian portfolio includes over 37 million square feet of leasable space at 68 properties in Canada, including landmark developments, such as Toronto-Dominion Centre, CF Toronto Eaton Centre, CF Pacific Centre, CF Chinook Centre, Tour Deloitte and CF Carrefour Laval.

About First Gulf

First Gulf is an award-winning leader in the development of office, industrial, mixed-use and retail properties with developed assets of over $4 billion completed since the company’s inception in 1987. First Gulf is a fully integrated development company and is involved in all aspects of real estate development, from land acquisition and planning approvals to design-build, construction, leasing, financing and property management. To date, First Gulf has developed and constructed over 30 million sf of office, retail, and industrial real estate. First Gulf is part of the Great Gulf Group, one of North America’s premier real estate organizations. Established in 1975, with major projects in Canada and the United States, the Group’s fully-integrated activities span the entire real estate spectrum.

SOURCE Cadillac Fairview Corporation Limited 


A proven market leader with more than $4 billion in developed assets

- Completed development and construction of more than 5 million square feet of premier LEED®

certified office space, with another 2 million square feet currently under construction

- Over 6 million square feet of industrial constructed with over 6 million square feet of space currently in the pipeline

- Awarded 2018 NAIOP “Office Development of the Year” for the Globe and Mail Centre and the

2016 NAIOP Colorado Office Development of the Year for 1401 Lawrence in Denver, Colorado

- Affiliate of Great Gulf, winner of 2018 Home Builder of the Year award from the Ontario Home Builders’ Association (OHBA) and the 2018 Mid/High-Rise Builder of the Year award from the Building Industry and Land Development Association (BILD) 

A Bold New Place Where Toronto Works.

As the largest planned commercial development in Canada, East Harbour will include over 10 million square feet of commercial space concentrated around a new transit hub – the busiest in Canada after Union Station.

East Harbour sits within one of the most dynamic, diverse and changing areas of the city. 


At least 80% of the commercial space will be dedicated to office, institutional and hotel uses and up to 20% will be dedicated to retail, food and culture & entertainment.

East Harbour will create space for more than 70,000 jobs within a new dynamic, integrated, comfortable and connected neighbourhood committed to the pedestrian experience.


Tenants and visitors will have direct access to the new East Harbour Transit Hub, the Don Valley Trail and new pedestrian and bicycle connections throughout.

A mix of indoor, weather-protected and street oriented retail will create an all-season environment, and highly programmed exhibits and events will offer an active and vibrant community. East Harbour will offer the newest mix of eateries, food markets and restaurants, supporting local and international food culture. 




East Harbour sits on the eastern edge of the City’s downtown among major infrastructure investments enabling future economic growth in the area. 




The Don Mouth Naturalization project will provide permanent flood protection, removing East Harbour from the floodplain and allowing for development, in addition to protecting approximately 700 acres in the Port Lands.

All three levels of government have committed a total of $1.25 billion in funding and construction is now underway and flood protection will be in place by 2022. 



The team is focused on creating an innovative, cutting-edge sustainable development. East Harbour is a registered EcoDistrict, addressing equity, resilience and climate protection.

A Community Energy Plan will establish a low carbon footprint across the project which includes a District Energy System. LEED v4 Platinum or Gold as well as WELL Certifications will be targeted across the development. 



In June 2018, Toronto City Council unanimously approved a Secondary Plan that calls for the 62-acre East Harbour lands to be redeveloped. In July 2018, Toronto City Council unanimously approved a rezoning that permits 10 million square feet of commercial development.

In support of the municipal applications, a Master Plan was developed through a highly iterative and collaborative process to guide the revitalization. 



Building on the Master Plan, a Character Plan has evolved to support the advancement of a more detailed design concept.

A primary focus of this ongoing design work is to further define the character of the district and ensure that a new development supports the creation of a superior pedestrian experience and public realm. 



East Harbour’s First Office Building, Breaking Ground in 2019.

A 600,000 square-foot office building with 45,000 square feet of retail space, the Soap Factory will be built as an adaptive re-use of the existing beloved industrial building. Occupancy is expected in 2021, coinciding with the delivery of the East Harbour Transit Hub. 


Average Monthly Asking Rent in Canada Up 4.3 Per Cent: Rentals.ca Report

According to the January National Rent Report from Rentals.ca and Bullpen Research & Consulting, the average monthly asking rent for Canada rose 4.3 per cent year over year at the end of December.

Toronto, Montréal and Vancouver experienced significant rent increases in 2019 for all property types listed on Rentals.ca. Toronto’s rent saw a 9 per cent increase, Montréal at 25 per cent, and Vancouver at 11 per cent.

In Montréal, expensive downtown listings in 2019 outnumbered those in 2018. Average monthly rents went from $1,286 to $1,611 year over year. In Vancouver, higher-rent condominium apartment listings on Rentals.ca in 2019 exceeded those in 2018.

According to the report, young tenants in all three municipalities are looking for walkable downtown communities where they can live without the expense of owning and parking a car — and without a crippling commute. To deal with affordability, young professionals are squeezing into smaller units and living with roommates well into their 30s.

The report suggests that rental affordability is expected to get worse in 2020 in Ontario and British Columbia, despite an increase in new rental apartment construction, and the crackdown on empty units and AirBnB in several markets.

Rentals.ca is forecasting more modest rental growth in 2020 versus 2019, but the expectation is average rents will grow faster than inflation in most major markets outside of Alberta and Saskatchewan.

Rentals.ca’s recently published 2020 Rental Market Predictions report, forecasts Canada’s average rental rates will increase 3 per cent year over year.

With Bullpen Research & Consulting, Rentals.ca also forecasts annual rental rates could increase in 2020 by as much as 7 per cent in Toronto, 5 per cent in Montréal, 4 per cent in Ottawa and 3 per cent in Vancouver.

In the January report, Toronto had the priciest average monthly rent of the 30 cities on the list for a one-bedroom home at $2,299 and for a two-bedroom at $2,914.

St. John’s had the lowest average monthly rent of the 30 cities for a one-bedroom home at $885, and Lethbridge finished with the most affordable average monthly rent for a two-bedroom at $1,022.

The average rent for Canadian properties listed on Rentals.ca in December 2019 was $1,854 per month, a decrease of 3.3 per cent monthly (even with an annual increase of 4.3 per cent).

Rentals.ca partner Local Logic provided insights for renters lifestyle interests and found many millennial families want more than anything to live near a quality school.

“As more families continue to rent as opposed to buy, we see renters for larger homes are willing to sacrifice their ability to take transit or walk to get their groceries in favour of being near a quality school,” says Vincent-Charles Hodder, CEO of Local Logic. “We expect the rental markets to perform strong in areas close to schools in 2020.”

When considering rental and condominium apartments only, two cities experienced more than 20 per cent rent appreciation from December 2018 to December 2019. Scarborough topped the list at 24.3 per cent, and Montréal had 22.6 per cent annual growth. Winnipeg achieved the third highest gains at 19.9 per cent; Vancouver went up 13.6 per cent and Toronto increased 10 per cent. 


Saskatoon experienced a substantial rent drop of 15.2 per cent, with Regina not far behind at 13.6 per cent. The average rent in Edmonton declined by 8.6 per cent, Red Deer dropped 7.4 per cent, and Calgary declined by 3.9 per cent.

Average rents decreased for all property types from the fourth quarter 2018 to the fourth quarter of 2019 in Calgary, Edmonton, Red Deer, Lethbridge, Fort McMurray and Grande Prairie.

On a provincial level, Ontario had the highest rental rates in the fourth quarter of 2019, with landlords seeking $2,318 per month on average for all property types.

Ontario also has the highest share of condominium apartment listings at 37 per cent of the provincial total. British Columbia had the second highest rental rate at $1,928 per month, while Newfoundland and Labrador had the lowest at $954. 


Toronto Condo Inventory Fell To The Lowest Level In At Least 10 Years

The Greater Toronto condo market saw a small spike in buying activity last month. Toronto Real Estate Board (TREB) data shows condo apartment sales increased in December. The rise in sales was accompanied by very few new listings, helping to send prices to a new all-time high.

Greater Toronto Condo Prices Rise Over 9%

Toronto is seeing condo apartment prices rise very quickly these days. TREB reported the typical, or benchmark, condo price hit $558,000 in December, up 9.48% from the same month last year. In the City of Toronto, the benchmark reached $590,100, up 9.07% from last year. Condo apartments are at a new all-time high according to the benchmark price.

Toronto Benchmark Condo Price

The price of a “typical” condo apartment in Toronto. 


Source: CREA, Better Dwelling.

The rate of growth did see a bump in acceleration, but it was the first in a while. TREB’s 9.48% growth rate only dropped one basis point from the previous month. However, the City of Toronto dropped nearly half a percent from the month before. Now both rates are still very high, and it was the first deceleration in a while. It’s too early to tell if this is a blip or a little resistance to price growth.

Toronto Benchmark Condo Price Change

The annual percent change of price, for a “typical” condo apartment in Toronto. 


Source: CREA, Better Dwelling.

The median sale price reflected much larger growth, nearly catching up to the benchmark. TREB’s median sale price came in at $550,000 in December, up 13.40% from the same month last year. The City of Toronto hit $585,000, up 11.43% from last year. This is very close to the benchmark, something that hasn’t been seen in a while.

Toronto Median Condo Sale Price

The median sale price of a condo apartment in Toronto. 


Source: CREA, Better Dwelling.

The average sale price for Greater Toronto’s condo apartments made a similar increase to the other metrics. TREB reported the average sale price reached $612,464 in December, up 10.454% from last year. In the City of Toronto, it hit $656,233, up 10.41% from last year. Considering these numbers were both substantially higher than the median, there’s a good chance luxury was a big hit last month.

Toronto Average Condo Sale Price

The average sale price of condo apartments in Toronto, and the suburbs. 


Source: CREA, Better Dwelling.

Toronto Real Estate Sales Rise Over 5%, Still Below Typical

Greater Toronto condo sales increased, but fail to reach typical levels for the month. TREB reported 1,255 sales in December, up 5.91% from a year before. The City of Toronto represents 884 of those sales, up 4.25% from last year. Both regions experienced a substantial increase in volume but failed to reach norms. Last month was still over 14% lower than the median sales volume in the prior 5-years for the month. The drop in sales is largely explained by inventory.

Toronto Condo December Sales

The number of condo apartments sold in the month of December, by year. 


Source: TREB, Better Dwelling.

Toronto Condo Inventory Was The Lowest In A Decade

December isn’t a big month for listing your home for sale, and last month was no exception. New listings for condo apartments came in at 1,092 across TREB, down 5.29% from a year before. The City of Toronto represented 779 of those listings, down 2.99% from a year before. There were fewer new condo listings than sales last month, compounding pressure on buyers. However, this is a fairly normal thing for the month.

Toronto Condo Sales Vs. New Listings

The number of condo sales, vs newly listed condos across Greater Toronto. 


Source: TREB, Better Dwelling.

More sales and fewer new listings wore down total inventory, to the lowest level in years. TREB reported 1,660 active listings in December, down 29.39% from last year. The City of Toronto represented 1,148 of those listings, down 23.57% from last year. This is the lowest level of condo apartments available for sale in December, for at least a decade.

Toronto Active Condo Listings

The number of condo listings available for sale in Toronto. 


Source: TREB, Better Dwelling.

Generally speaking, the Greater Toronto condo market saw more sales, lower inventory, and higher prices. The drop in sales is likely due to the scarcity of inventory. Surprisingly, even with the tight inventory, price growth slowed for the first time in months. 

Canada’s First-Time Home Buyer Incentive Receives Cold Reception

Not a lot of real estate buyers across Canada are interested in the latest government buying scheme. Government of Canada (GoC) data shows the First-Time Home Buyer Incentive (FTHBI) received a cold reception. From the launch of the program, to the beginning of December, only two provinces represented the majority of applications. Those two provinces, ironically, were home to some of the most affordable real estate in the country.

First-Time Home Buyer Incentive

The First-Time Home Buyer Incentive (FTHBI) is a shared-equity mortgage program. The Government of Canada will provide funds for 5 to 10 percent of your home, depending on if it’s a resale or a new home. The government then shares the upside and downside of the home’s value. That is, if you lose money when you sell – the government will shoulder part of that loss. If you make money, you’ll pay the government a portion of the profits, proportional to their stake. We’ve covered the history of these programs before, and how its traditionally used to stimulate demand – not improve affordability. So we won’t bore you with a full rehash.

The FTHBI Only Delivered $51.3 Million In Funds

The FTHBI incentive is off to a slow start, except in Quebec. The program delivered just $51.3 million in funds from September 2 to December 9, 2019. Quebec represented the largest segment, borrowing $18.74 million over the period. Alberta followed with $16.30 million, and Ontario was a distant third with just $7 million borrowed.

First-Time Home Buyer Incentive

The dollar value borrowed through the First-Time Home Buyer Incentive (FTHBI), from September 2 to December 9, 2019. 


Source: Government of Canada, Better Dwelling.

Two Provinces Represent The Majority Of Applications

Only two provinces make up the majority of applications – and approvals. There were 3,252 applications across all of Canada, with 2,730 approved. Quebec represents 1,360 of those applications, with an approval rate of 86.1%. Alberta is the second largest number of applications with 809, and has an approval rating of 83.9%. Ontario is a distant third with 436 applications, and an approval rating of 80.2%. Just Quebec and Alberta make up the majority of applications.

First-Time Home Buyer Incentive Applications

The number of applications and approvals for the First-Time Home Buyer Incentive (FTHBI), from September 2 to December 9, 2019. 


Source: Government of Canada, Better Dwelling.

British Columbia real estate buyers were surprisingly not interested at all. Just $2.1 million of funds were used in the province over the two month period. Only 151 applications were made, with an approval rating of 77.4%. The B.C. market wasn’t close to the top or bottom of the ranks. A little surprising, since real estate makes up such a large portion of industry in the province.

The FTHBI is receiving a lukewarm reception across most of the country. The introduction of this program fired up a lot of speculators, hoping to capture the extra money. However, it may not have the long-term impact the government or speculators hoped for. 

New Condo Sales in GTA Hit 3rd-Highest Level on Record in 2019: Report


2019 was a record year for new condo sales in the Greater Toronto Area (GTA), growing 27% to an impressive total of 25,097 units sold, the third-highest year on record, according to Urbanation Inc.’s year-end condominium market report.

The report, which was released Monday, revealed new condo activity surged in Q4-2019 with 8,044 units sold, up 38% than the same period a year ago, and nearly matching the record high set in Q4-2017 when 8,755 units sold.

Urbanation, a leading source of information and analysis on the GTA condominium market, says a 75% share of the 23,953 units brought to the pre-sale market by developers in 2019 were sold — up from a 63% share of new launches in 2018 — averaging a selling price of $967 per-square-foot, a 4.7% increase from 2018.

In contrast, unsold condos at the end of 2019 decreased by 4.8% to 13,373 units to remain below the 10-year average of 15,907.

Despite the current demand for new condos in the GTA, inventory fell to 6.4 months of supply, which Urbanation says is substantially below what is considered to be a balanced level at 10 months. As a result, pricing for the available units climbed to a record-high $1,073 per-square-foot, a 9% annual increase that followed a 50% two-year increase between 2016 and 2018, which led to a doubling of new condo prices over the past ten years.

A total of 18,232 units from development projects that launched in 2019 were sold, up 17% compared to new launches sold in 2018.

And while this does serve as a good indicator of growth in demand from investors, who tend to be most common within newly launched projects, Urbanation says sales within pre-existing development projects that launched prior to 2019 grew even stronger with a 70% jump to 6,865 units, providing evidence of a rebound in demand from end-user buyers as well.

By region, the 905-area saw the strongest growth last year, accounting for 42% of all sales in 2019, up from 32% in 2018. New condo launches in the 905 averaged a selling price of $795 per-square-foot, which was 28% below the 416 average of $1,108.

However, it was the old City of Toronto that saw new condo sales drop in 2019, falling 15% to their lowest level since 2013.

Furthermore, new condo sales in the old City of Toronto recorded their lowest share of GTA sales on record at 31%, which Urbanation says provides a “clear illustration of how the diminishing number of high-rise development sites are impacting prices in the core and the distribution of activity across the GTA.”

Pauline Lierman, Director of Market Research at Urbanation, told Toronto Storeys there were two factors that affected this market: the number of sales in the 905-region and the lack of new launches in the former City of Toronto.

According to Lierman, in 2019, 25 developments opened in the former City with a total of 5,255 units. By comparison, 2018 saw 37 projects launch with 11,062 units, and in 2017 there were 39 projects launched with 14,277 units.

“Overall, there is less new opening activity in the former City to feed sales than in the last two years. You would expect fall off from the market peak of 2017; however, factoring in the comparatively slower 2018, logic would see a rise in 2019 for new launch activity,” said Lierman.

“This is where the 905 comes in, and to a lesser extent, the outer 416 former municipalities for the second factor, which is price-driven. The downtown market now averages around $1,300 per-square-f00t, whereas prime 905 markets are now between $800 to $900 per-square-foot.”

When looking at activity in the GTA’s submarkets, the report highlighted the city centres of Vaughan and Mississauga, which saw a combined 4,172 sales in newly launched projects in 2019, averaging nearly identical selling prices of $834 and $857 per-square-foot, respectively.

Within the 416, the top submarkets were North Midtown (Yonge and Eglinton), Downsview, and Downtown East, which together sold 2,757 units in new launches that averaged selling prices between $931 and $1,230 per-square-foot.

As we head into 2020, Urbanation predicts the level of condo completions will be an important factor for the GTA market this year.

After years of low completions and strong construction starts, the number of units under construction at year-end 2019 soared to a record 78,112 units — rising by more than 20,000 units over the past two years.

According to Urbanation, there are approximately 29,500 condo units scheduled to be completed this year, not only doubling the level completed in 2018 but also far surpassing the previous high set in 2014 when 21,000 units were completed. 

Mississauga real estate prices surpass much of Toronto in December

The average sale price for real estate in Mississauga exceeded prices in much of Toronto in the final month of 2019.

The Toronto Real Estate Board (TREB) released its December monthly market tracking report on Jan. 6 with Mississauga registering an average sale price of $799,593 for all types of dwellings compared to $785,494 in Toronto west and $753,468 in Toronto east.

Only Toronto’s central region outpaced Mississauga last month, registering an average sale price of $1,011,199 for all types of dwellings in December.

TREB’s Toronto central area is bordered by Dufferin Street and Allen Road to the west, Steeles Avenue to the north and Victoria Park Avenue and the Don Valley Parkway to the east.

Detached homes in Mississauga sold for an average of $1,221,652 in the final month of 2019, compared to $1,155,189 in Toronto West, $944,621 in Toronto East and $2,157,650 closer the downtown core in the central area of the city.

Toronto still outpaced its neighbour to the west in the semi-detached segment of the market, with all three areas of the city’s regions exceeding Mississauga’s December average of $772,374.

Mississauga’s condominium market registered an average $513,331, marking the third straight month the average price for an apartment-style condo exceeded $500,000. That outpaced the average of $476,795 registered in Toronto's east end but was less than the $544,255 average seen in the city’s west end and $733,828 December average in the city’s central region.

“We certainly saw a recovery in sales activity in 2019, particularly in the second half of the year. As anticipated, many home buyers who were initially on the sidelines moved back into the market place starting in the spring,” wrote TREB president Michael Collins in his monthly market analysis.

“Buyer confidence was buoyed by a strong regional economy and declining contract mortgage rates over the course of the year,” he added. 

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