Canadian industrial real estate availability increased to 5.1% in the first quarter of 2024, says a new Altus Group report.

Availability rose 80 basis points as new supply coincided with a reduction in leasing activity, according to the Toronto-based market intelligence firm. A total of 34 industrial buildings that span 6.4 million square feet were added to the market with 46% preleased.

The market returned to normal following a wave of new supply in the fourth quarter of 2023. The 6.4 msf total completed in the first quarter of 2023 was similar to the 6.6 msf built a year earlier.

Most of the new supply was delivered in Toronto, Montreal and other parts of Southwestern Ontario.

For the most part, leasing r.ates remained flat in the first quarter of 2024 due to the new supply and flattening demand for space. In most major markets. Investment demand remained strong as investors sought assets at certain price thresholds to counter high borrowing rates.

“Furthermore, the growth in e-commerce, changing consumer behaviour, and challenges associated with an aging and limited industrial infrastructure are expected to continue to drive the long-term demand for modern industrial facilities,” states the report.

Jennifer Nhieu, an Altus senior research analyst, and Ray Wong, the firm’s vice-president of data solutions delivery, authored the report.

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