NEWS RELEASE



GTA REALTORS® ReLEASE Q3 Commercial Market Figures

TORONTO, October 5, 2016 -- Toronto Real Estate Board President Larry Cerqua announced that the total amount of leased space reported through TREB’s MLS® System in the third quarter of 2016 was up substantially on a year-over-year basis.  There was a combined 6,592,818 square feet of industrial, commercial/retail and office space leased – up 34.8 per cent compared to the third quarter of 2015.  It is important to note that the Q3 2015 results did represent a substantial dip compared to the same period in 2014.

More than three quarters of total space leased in Q3 2016 was in the industrial market segment.  The average industrial lease rate on a per square foot net basis, for transactions with pricing disclosed, was up by 8.8 per cent to $5.80 compared to $5.33 in Q3 2015.  The average commercial lease rate was down on a year-over-year basis, while the office lease rate was up compared to last year.

“The Canadian economy over the last year has been marked by regional differences.  The Greater Toronto Area has benefited from a diverse economic base and, as a result, the regional economy has been relatively strong with the unemployment rate generally trending lower.  This may be why we experienced an uptick in leasing activity.  However, there remains some uncertainty in the economic outlook, especially as it relates to exports, and this could impact commercial leasing and sales activity moving forward,” said Mr. Cerqua.

The number of combined industrial, commercial/retail and office property transactions was down in Q3 2016 compared to a year earlier, with 216 properties changing hands versus 327 properties in Q3 2015.

While the number of sales were down year-over-year, average selling prices on a per square foot basis, for transactions where pricing was disclosed, proved resilient.  Average selling prices were up for all three major market segments.  The large increase in the office property average price was largely due to a shift in the size and location of properties sold this year compared to last, with some larger properties changing hands in Toronto’s central core.

 

Third Quarter 2016: All Commercial Lease Transactions

Total Leased Space for All Lease Transaction Types on TorontoMLS

Total Leased Square Feet

 

Q3 2016

Q3 2015

% Change

Industrial

5,109,760

3,695,574

38.3%

Commercial

741,456

568,872

30.3%

Office

741,602

625,736

18.5%

Total

6,592,818

4,890,182

34.8%

 

Third Quarter 2016: Per Square Foot Net Commercial Leasing Summary

Lease Transactions Completed on a Per Square Foot Net Basis with Pricing Disclosed on TorontoMLS

Average Lease Rate

 

Q3 2016

Q3 2015

% Change

Industrial

$5.80

$5.33

8.8%

Commercial

$13.86

$19.02

-27.1%

Office

$12.70

$12.29

3.3%

Third Quarter 2016: All Commercial Sale Transactions

Total Number of Sales on TorontoMLS

Total Sales

 

Q3 2016

Q3 2015

% Change

Industrial

75

125

-40.0%

Commercial

98

136

-27.9%

Office

43

66

-34.8%

Total

216

327

-33.9%

Third Quarter 2016: Commercial Sales Completed with Pricing Disclosed on TorontoMLS

Avg. Sale Price Per Sq. Ft. (Pricing Disclosed)

 

Q3 2016

Q3 2015

% Change

Industrial

$111.13

$102.54

8.4%

Commercial

$208.22

$202.23

3.0%

Office

$353.88

$192.23

84.1%

Source: Toronto Real Estate Board

NOTE: Some table totals may differ due to conversion and rounding.