City of Toronto 2018 Industrial Sales Market Overview 

The City of Toronto’s Industrial Market (Etobicoke, North York, Toronto, East York and Scarborough) was on fire in 2018, resulting in a total sales volume of more than $658 million, with seventy eight properties larger than 20,000 SF sold for a total of 5,163,633 SF, at an average price of $127.51 PSF.

Summary of the City of Toronto 2018 Industrial Sales Transactions 

Sales were evenly distributed across the city, however, Etobicoke had the most sales (1.816 million SF in 27 buildings), the highest sales volume ($250 million) and the highest average price PSF ($137.68).

 

Summary of the City of Toronto 2018 Industrial Investment Sales Transactions

Investors showed great interest in single-tenant as well as multi-tenant buildings due to significant potential for a “value add” play. 

Value Add Opportunities for Investors – Single-Tenant Building:

  1. Resale to a user upon Lease expiry at a higher value then income value/CAP rate value
  2. Redevelopment upon Lease expiry 
  3. Increase net rental rate on Lease renewal
  4. Surplus Land available for development

 

Value Add Opportunities for Investors – Multi-Tenant Building:

  1. Increase net rental rates on lease renewals
  2. Conversion to industrial condominiums
  3. Surplus Land available for development

 

CONCLUSION:

We finished 2018 with 78 transactions – 61 were user sales, while 17 were investment sales with CAP rates ranging from 3.7% to 7% with an average CAP rate of 4.99%. 

It was very difficult to buy an industrial property in the City of Toronto in 2018 with vacancy rates for purchase in the last quarter being as low as 0.1%. It is important to understand that many transactions these days happen “off the market”. 

Street level brokers that are in constant contact with investors and occupiers usually have information about opportunities before they are available to the market in general. Please keep in touch!

For a confidential consultation or for complimentary opinion of value of your property please give us a call.

 

Goran Brelih and his team have been servicing Investors and Occupiers of Industrial properties in Toronto Central and Toronto North markets for the past 25 years.

Goran Brelih is a Senior Vice President for Cushman & Wakefield ULC in the Greater Toronto Area. 

Over the past 27 years, he has been involved in the lease or sale of approximately 25.7 million square feet of industrial space, valued in excess of $1.6 billion dollars while averaging between 40 and 50 transactions per year and achieving the highest level of sales, from the President’s Round Table to Top Ten in GTA and the National Top Ten.

Goran is currently serving as President of the SIOR ‐ Society of Industrial and Office Realtors, Central Canadian Chapter and on the Board of Directors of Muki Baum Accessibility Centre, a Toronto‐based NGO which provides support to children and adults with complex disabilities.

Specialties:

Industrial Real Estate Sales and Leasing, Investment Sales, Design Build and Land Development

About Cushman & Wakefield ULC.

Cushman & Wakefield is a leading global real estate services firm that delivers exceptional value by putting ideas into action for real estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms with 48,000 employees in approximately 400 offices and 70 countries. In 2017, the firm had revenue of $6.9 billion across core services of property, facilities and project management, leasing, capital markets, advisory, and other services. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.

For more information on GTA Industrial Real Estate Market or to discuss how they can assist you with your real estate needs please contact Goran at 416-756-5456, email at goran.brelih@cushwake.com, or visit www.goranbrelih.com.