Skyline’s Byrd, Other Executives Assess Market’s Present, Future

Connect has launched its 2025 Canadian Summer Leadership series. In this edition: Wayne Byrd, CFO for multi-family, industrial and retail real estate specialist Skyline; Alex Akman, chief operating officer for integrated investment, development and management firm Shindico; and Jonathan Turnbull, head of Canada for Harrison Street, share their views on the state of the Canadian marketplace and drill down on U.S. tariffs and foreign investment.

What is your outlook for Canadian CRE investment over the rest of 2025 and into 2026?

Wayne Byrd: “The outlook varies by asset class, but overall, we remain confident in the long-term fundamentals of the segments in which Skyline operates, namely multifamily residential, industrial, and essential retail.

“On the retail side, there is continued strength in essential retail, which comprises roughly 80% of Skyline’s Retail REIT portfolio. Favourable supply and demand dynamics continue to drive the industry as new quality retail space continues to lag behind population expansion. Recent profit growth at Loblaws and Empire Co. Ltd. underscores this strength, with metrics such as same-store sales, basket size, and overall consumer traffic showing meaningful growth. This bodes well for industry tenancy and leasing metrics.

“On the industrial side, we see record supply in certain markets gradually being absorbed and incremental visibility on U.S. tariffs. Although certain industries like steel and softwood lumber are bracing for significant impact, it appears Canada has escaped the broad-based tariffs that were threatened to be imposed at the start of the year. Local pockets in provinces like Alberta continue to see strength. I believe transaction flow and leasing demand will firm up further as economic visibility returns to the market.

“In short, while each sector of real estate is responding differently to current economic forces, the long-term outlook remains constructive across the board. I believe high-quality assets in undersupplied, essential segments will continue to attract both investor and tenant demand.”

Which asset classes do you expect to shine and why?

Wayne Byrd: I believe essential retail is well-positioned to shine in the foreseeable future.

“Despite some lingering misconceptions—often tying the asset class to enclosed malls or legacy retailers like Hudson’s Bay Co.—essential retail continues to deliver strong operating results. The pandemic reaffirmed the enduring value of brick-and-mortar essential retail shopping for everyday goods, particularly in categories such as grocery, health care, and quick-service dining. A lasting impact from that period was a significant slowdown in new retail construction, leaving the industry still playing catch-up. This has created a favourable supply-demand dynamic, where tenant appetite for quality space exceeds available inventory and supports strong rental growth and high occupancy across the sector.

“Overall, brick-and-mortar essential retail continues to show incremental growth [BC1] and reliability. It remains a key part of the Canadian consumer scene, where grocery-anchored centers continue to see steady foot traffic, stable profits, and ongoing sales growth. These attributes highlight a sector that is important to the economy and operates well regardless of the economic conditions.

“Quick-service restaurants, a key part of essential retail, continue to show strong performance on the back of rising commuter volumes tied to the return-to-office mandates.  [BC5] Industry data shows that nearly two-thirds of QSRs across North America have seen broad-based traffic gains, while 93% have implemented price increases over the past year.

“With more Canadian employers moving toward four-day in-office workweeks in 2025, we expect this upward trend to continue. This bodes well for nationally recognized QSRs such as Tim Hortons and Burger King—both of which represent a meaningful share of our retail portfolio.”

How do you think tariffs will impact Canadian CRE investment during the second half of 2025 and beyond?

Jonathan Turnbull: “The tariff question is difficult to answer given the market dynamics surrounding them. We can not be certain what tariffs, if any, will be in place in two weeks, let alone 18 months from today. We hope that all parties can reach a balanced trade agreement.

“That said, the current tariff impact on new Canadian CRE development does not appear to be substantial. Harrison Street’s costing consultants at Finnigen Marshall have estimated that new development hard costs have been elevated by 1% to 3% by the current tariffs, which could be offset by lower employee costs expected in the near term with construction slowdowns. In my opinion, the biggest impact of tariffs is the market uncertainty which is holding back broad traditional sector investment.”

What’s your outlook for foreign investment in Canada within the next six to 12 months?

Alex Akman: “I think [Canada is] a localized market. I think that somewhere like Toronto may struggle for a period of time. Is that going to be indefinite? Absolutely not. But I think the reality is, when you look across the global landscape, is Canada an attractive place to invest? I don’t know the answer to that, but I don’t think that higher taxes or more regulation or more government intervention is going to result in a foreigner saying, ‘Yes, that’s where I want to park my capital,’ whereas other countries may be offering incentives, lower tax rates, stronger currency, etc. So, I’m a little bit nervous, but I you know, it’s a short timeframe, 2025, 2026, or 12 months.

“I have no doubt that Canada will be an attractive place long-term, and that it is still a safe haven. I just think that, maybe, we have a little bit of a bump in the road, so we’re cognizant of that as we’re planning our portfolio and looking at our liquidity. But I don’t expect it to last. I do think that the government could do us some favours by trying to incentivize some of that investment and potentially looking at looking at taxes.”