Report | Evolving Workforces

Toronto Lab Market Fall 2023

November 2, 2023 15 Minute Read

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The laboratory real estate market in the Greater Toronto and Hamilton Area (GTHA) is a tale of two stories amongst a finicky capital market that has tamped down the tsunami of demand that was previously brought on by free flowing 2021 capital.  

Key Findings:

       Lab development is lagging thanks to economic headwinds facing both the development proforma and tenant dependent capital markets  

       Developer concern around the ability for the tenant base to lease space at proforma driven pricing persists

       A couple of key projects will serve as the proxy for the overall marketplace and its ability to absorb vacancy at market rates 

       Employment in the sector continues to grow and capital, while seemingly more abundant than ever before, is being very selective in its investment

        Articulated government support is needed under the current economic climate to support the growth of R&D in the region which will help spur on more CRO and CDMO development

        Tenant demand, while cut in half from the peak in 2022, remains high and continues to outpace the availability of space

       Multitenant wet lab facilities for R&D remains the greatest area of need

       Incubation/accelerator operators are desperately needed to accommodate the large swath of small companies with nowhere to grow