Although borrowing rates remained high, optimism grew following the Bank of Canada’s 25-basis-point overnight rate cut in June. The sector is expected to continue performing positively.
Industrial property transactions surged by 48.1 percent in the second quarter across five major markets, boosting overall Canadian investment volume. However, industrial leasing demand slowed as construction increased, raising the national availability rate.
The office leasing market made progress, driven by pre-leased spaces in newly constructed buildings. Toronto and Montreal saw positive absorption rates in the second quarter, reflecting a preference for high-quality, amenity-rich office space.
Retail leasing activity also grew as retailers sought premium physical spaces. However, retail property investment slowed, as institutional buyers remained selective in acquisitions.
Canada’s economy grew modestly in the second quarter, despite the combined impacts of high interest rates, inflation, forest fires, and labour disruptions. Inflation pressures eased, with the Consumer Price Index falling below 3.0 percent.