Regional Variations Highlight GTA West’s Slow Patch

The GTA West – comprised of Peel and Halton Regions – has long been the beating heart of the region’s industrial engine, a magnet for logistics giants and manufacturing powerhouses fuelling Canada’s supply chain.

But the pulse is slowing.

With large-block leasing in these leading submarkets hitting a rare lull, questions are swirling:

Is this a temporary dip, or a sign of deeper shifts?

Without a doubt, markets have pulled back ever since the rise in interest rates and looming elections south of the border. The ensuing tariffs were just the exclamation point on an already cautious and fragile environment.

All of these headwinds have led to ‘pencils going up’ and delayed decision making.

That said, pricing has shifted too.

Even more importantly, expectations are not what they were following the post-lockdown boom; where rents and values not only increased but seemingly multiplied in the blink of an eye.

It is, in fact, that very boom and price signalling which led to the enormous pipeline of new deliveries that have now contributed to the oversupply. And the underlying fundamentals, i.e. the new spec builds pre-leasing for north of $20 PSF Net, further exacerbated the issues downstream as even Class B and Class C buildings saw head-turning renewal proposals and sales pricing.

Moving back to today, as Landlords and Sellers have become more aggressive in their pursuit of Tenants and Buyers, deals are suddenly becoming more and more attractive.

There are (finally) deals to be had.

And despite the overall landscape that brought us to this point in time, there is budding optimism for the future.

So with this preamble behind us, for this week’s newsletter, we will continue last week’s discussion on large block leasing and examine the variation in market performance across regional markets.

What Happened to the GTA West’s Industrial Dominance?

Peel and Halton Regions – the Greater Toronto Area’s largest and most active industrial submarket – has historically dominated large-block leasing (200,000+ SF), averaging 13 deals annually from 2020 to 2023 and capturing nearly 70% of activity. But 2024 saw a sharp drop to just four deals, with only one recorded in 2025 year-to-date. 

Source: Cushman & Wakefield Research.

This slowdown likely stems from a combination of factors: the full impact of tariffs still unknown, high interest rates cooling expansion plans, an oversupply of large-format spaces, and tenants reevaluating their logistics strategies amid economic uncertainty.

In contrast, the GTA North and East markets have shown relative resilience. They’ve never competed with the West for dominance, per se, but they have had a slow, consistent burn. These submarkets averaged four and two large-block deals per year, respectively, from 2020 to 2023, with similar activity continuing into 2024 and early 2025.

Their stability may reflect more diverse tenant bases, including advanced manufacturing and regional distribution, which are less sensitive to the logistics-driven volatility affecting the GTA West. The GTA Central, however, remains inconsistent, with sporadic leasing activity; driven largely by the different inventory and fewer number of Big Box developments when compared to the more outlying submarkets.

Source: Cushman & Wakefield Research.

For stakeholders, these regional variations demand a tailored approach. In the GTA West, landlords may need to offer incentives, such as flexible lease terms or tenant improvement allowances, to attract large-block tenants. Alternatively, demising larger properties into smaller spaces can help chip away at these behemoth buildings. This also taps into the resilient and steady demand for sub-100,000 SF units.

In the GTA North and East, where large-block demand remains consistent, owners should prioritize securing long-term leases with creditworthy tenants to lock in value. Developers, meanwhile, should proceed cautiously in GTA West, focusing on projects with pre-lease commitments to mitigate risk – at least until absorption catches up with the glut of inventory we saw come online in the past 1 to 3 years.

The broader context is critical. The GTA West’s slowdown doesn’t erase its long-term appeal—its proximity to major highways, Toronto’s Pearson International Airport, and the labour pool ensures enduring demand. But for now, tenants are cautious and looking for value; which can more easily be found amongst the latest inventory glut in the GTA East markets. Investors should diversify across submarkets to balance exposure, while tenants can leverage the current lull to negotiate favourable terms across all submarkets.

Source: Cushman & Wakefield Research.

Key Takeaway: The GTA West’s large-block slowdown offers an opportunity for occupiers to secure some of the best-located space the GTA has to offer, and at rates and terms which will likely revert to previous levels once the economy emerges from its current uncertain state. Monitoring economic signals will be key to timing the next move.

Conclusion:

GTA West’s quieter phase is a reminder that even the strongest markets face cycles, while the GTA North and East prove resilience amid uncertainty; even if only due to constrained supply or historically cheaper pricing.

This regional divergence calls for strategic precision—whether it’s offering incentives in West or locking in stable tenants in North and East.

As the GTA’s industrial landscape evolves, success lies in understanding submarket nuances and acting decisively. Keep an eye on economic indicators, like interest rates, tariffs and trade deals, and supply chain trends, to anticipate shifts.

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

Until next week…

Goran Brelih and his team have been servicing Investors and Occupiers of Industrial properties in Toronto Central and Toronto North markets for the past 30 years.

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

Over the past 30 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.

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

About Cushman & Wakefield ULC.
Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms with approximately 53,000 employees in 400 offices and 60 countries.

In 2020, the firm had revenue of $7.8 billion across core services of property, facilities and project management, leasing, capital markets, valuation and other services. To learn more, visit www.cushmanwakefield.com.

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.

Connect with Me Here! – Goran Brelih’s Linkedin Profile: https://ca.linkedin.com/in/goranbrelih