A series of trends have sparked a shift in commercial activity
Canada’s commercial real estate sector is showing measured adjustments in response to economic pressures, shifting investor expectations, and population growth, according to the 2025 Commercial Real Estate Report by RE/MAX Canada.
The report, which reviewed first-quarter activity across 12 major markets, identifies Alberta, Saskatchewan, Manitoba, and Newfoundland and Labrador as the most active regions this year. Population gains and sustained immigration have supported transactions, while resource and infrastructure projects in Newfoundland and Labrador continue to draw both private and public investments.
Top performing property types
Multi-family and industrial assets continue to lead commercial transactions across the country, followed by retail. The limited availability of housing, a rise in e-commerce, and support from federal initiatives such as the Housing Accelerator Fund (HAF) have contributed to the sustained interest in these sectors.
“Canada’s commercial real estate market is shifting to fundamentals this year,” said Don Kottick, president of RE/MAX Canada. According to Kottick, institutional players and real estate investment trusts (REITs) are reengaging with an eye toward long-term value and income-generating opportunities.
Oxford Properties Group recently acquired a 50% interest in seven office towers in Vancouver and Calgary for $730 million—viewing current market conditions as conducive to returning to office assets.
Conversions and adaptive reuse on the rise
Cities such as Calgary, Ottawa, and London continue to repurpose office and retail properties into residential units.
Halifax and Winnipeg are seeing similar conversions, particularly targeting student and senior housing, as demand persists across these categories.
Industrial demand is driven by mid-sized flex spaces favoured by owner-occupiers in Calgary, Edmonton, Saskatoon, and Winnipeg.
In Saskatchewan, farmland values have risen by 13.1% over 2023 levels, despite challenges like declining commodity prices and trade constraints with China.
The hospitality sector is also seeing expansion. Hilton plans to open 11 hotels across three provinces, while Marriott and Hyatt continue to grow their presence. In Saskatoon, investors are acquiring existing hotel properties, finding renovation more feasible than new builds amid rising construction costs.
Older buildings offer investment potential
Across cities like Vancouver, Saskatoon, and Hamilton, REITs and private investors are targeting aging multi-family buildings for upgrades and potential rent increases.
HAF, along with an added $74 million in incentives, aims to support the development of 112,000 housing units by 2028.
While investors remain cautious, commercial real estate activity is steady. Inventory growth in the industrial and multi-family segments is helping to ease rent pressures and increase competition across aging building stock.
