Greater Toronto Area commercial real estate investment rose 6% in the third quarter from the second quarter, says Avison Young in a new report.

But third-quarter investment of $2.9 billion marked a 6% decrease year-over-year. Meanwhile, land sales jumped 52% quarter-over-quarter as 1,515 acres traded.

Year-to-date investment fell 11% year-over-year to $8.7 billion.

The transaction total surged by 26% year-over-year in the third quarter as 381 deals were completed. But the year-to-date total declined 9% from 2024.

Investor sentiment is higher than the numbers indicate, and prospective buyers continue to pursue deals, said Avison Young. But the market has remained in a holding pattern longer than expected as stakeholders await a resolution to prevailing economic uncertainty despite more favourable debt-market conditions and ample capital availability.

Avison Young expects more deal activity in the fourth quarter and early 2026 as five-year mortgages come up for renewal. But activity will likely remain below normal levels as current conditions persist, the advisory firm predicts.

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