Canadian CRE Sector Needs More Creativity: Pickles
Connect is holding its Summer 2025 Leadership Series in which top executives from Canadian commercial real estate firms provide insights on the state of the market. Today, Simon Holmes, BGO’s Canadian chief investment officer, and Scott Pickles, managing director of Windmill’s advisory arm Urban Equation, offer their views.
What’s your outlook for the rest of 2025 going into 2026?
Simon Holmes: I think the industry is far more optimistic, through all the asset classes going into the last quarter of 2025. We’ve seen seen some momentum building. Certainly, the Bank of Canada the policy rate being turned down a quarter point is welcome news. I’m wouldn’t say that that’s a big needle mover in terms of the fundamentals of buying real estate, but I it’s a confidence builder. And, our investor community that it’s going in the right direction and for that matter that the you know the occupier community as well because. You know tenant improvements or financed and you know there’s, you know, lower, lower boring costs will be a positive.”
What potential investment barriers could people be overlooking?
Scott Pickles: “While the real estate industry is truly innovative, during times of stress, it’s interesting to see how the market has become stuck in a mentality where it races towards the next shiny asset — office, then industrial, and now we are seeing a shift from residential condos to rental properties. While there is nothing wrong with any of these assets, people often forget that the richness of our cities is the result of creating spaces and places that people want to live, work, learn, and play in.
“Another potential barrier is that companies are underestimating tenant requirements. Assets that excel in areas such as operations, resident health, value to the broader community, and adaptability will outperform over the long term. For example, energy efficiency can position an asset to enhance the property’s quality while also reducing operating costs.
“Lastly, there needs to be more creativity in our sector. While real estate is inherently innovative, as it relies on envisioning what’s possible in our cities, there are often few companies looking to innovate and reconsider better ways of designing, constructing, and operating properties, which can de-risk and future-proof investments. With today’s market headwinds, there is an exciting opportunity to lead the way with new models, methods of construction, and approaches.
“Many are content to replicate current investment models – or hope for previously successful ones to return. Instead, developers need to look at how to create outstanding spaces, activate sites, and develop new complexities that can drive engagement, impact, and, as a result, revenue.”