Press Release

CBRE Forecasts a Record-Breaking $50-billion Year for Canadian Commercial Real Estate Investment

25 Feb 2020

Canada will solidify its status as a top destination for global and domestic capital in 2020. But considerable challenges loom.


Canada’s commercial real estate market is entering 2020 with strong momentum, setting the stage for what could be an unprecedented $50-billion year in investment volume, the highest on record, according to CBRE’s 2020 Canadian Real Estate Market Outlook Report. This is poised to be Canada’s decade for the taking, with the country no longer seen simply as a safe haven for investment, but now a top destination for domestic and global capital.

“A relentless bull market, macroeconomic tailwinds and supportive immigration policies have allowed Canada’s commercial real estate market to gather serious velocity heading into the new decade,” said CBRE Canada Vice Chairman Paul Morassutti. “There are challenges ahead, including rising rents, limited office and industrial space, new technologies and the all-important issue of climate change. But ingenuity across our industry has demonstrated that creative solutions and skillful management of these issues can ensure the real estate market’s ongoing success.”

While 2019 fell shy of a fourth consecutive record for commercial real estate investment volume, CBRE predicts 2020 could be Canada’s best year ever. The amount of capital on the sidelines is at an all-time high, and there is pressure to deploy this to real estate as yields on traditional investment vehicles shrink. New construction will also attract capital and perform strongly. Nearly 70% of downtown office space under construction nationally is already pre-leased and over 50% of the industrial space under construction spoken for.

Capital flows typically gravitate to core assets in major markets, however, domestic players looking to compete with foreign capital in major centres have 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 the year ahead in places like Ottawa, Waterloo Region, Hamilton, the B.C. Interior and the province of Quebec.

Tenants are having to make difficult choices to secure space and keep it relevant and productive as office rental rates continue to climb amid record-low vacancies. A lack of desirable square footage in major centres threatens to thwart companies looking to enter or expand in Canada. Even after space is secured, the rapid growth of technology, changing demographics and a shifting global economic environment are contributing to a sense of unpredictability.

On the industrial front, a lack of large bay options is forcing tenants to contemplate not being able to house all their operations in a single distribution centre in a major market, and companies are pivoting to bookend cities with smaller mid-sized locations. Efficiencies are being found in built form, with clear heights increasing to maximize cubic space: 40’ clear heights will be the new norm for speculative developments, while build-to-suit construction has made once-unthinkable 90’ clear heights possible.

Alongside record investment volume, CBRE has identified three structural issues that will be in focus for businesses, employees and residents in 2020:

  • Affordability: In big cities like Toronto and Vancouver, where the cost of living outpaces income growth, homeownership is getting out of reach. This has the potential to continue driving Millennials and low to middle-income workers away from downtown cores.
  • Infrastructure: As housing prices rise, transit infrastructure will become more important, as those living outside downtown cores will need to commute from farther away. Chronic under-investment in transit could restrict business growth, with new commercial spaces fighting for proximity to a limited number of transit hubs.
  • Climate change: Wildfires, heat waves, intense rainfall and other natural disasters will shape tenant, landlord and investor decision-making in 2020 and beyond. Low-risk areas will attract demand and experience rising prices as a result. The construction industry, a primary contributor to climate change, will be key to mitigation strategies.

“Left unaddressed, these forces have the potential to not only slow commercial real estate momentum but worsen income-inequality and inflame societal tensions,” Morassutti cautioned. “It is worth celebrating Canadian commercial real estate’s record momentum, and that success was hard won. But now we must rise to the new challenges and opportunities that lie ahead if Canada is to solidify its status as a primary global investment destination.”



About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2021 revenue). The company has more than 105,000 employees (excluding Turner & Townsend employees) serving clients in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at

In Canada, CBRE Limited employs 2,200 people in 22 locations from coast to coast. Please visit our website at