Canada’s commercial real estate market remains steady despite the country’s softening economic growth, says Morguard.

Commercial property investment sales activity remained muted in the third quarter, in accordance with a year-long trend, said Toronto-based Morguard in a report. Canada’s top 10 markets reported approximately $4 billion of investment sales transaction volume.

But multi-residential real estate rental-rate growth accelerated as demand outpaced supply. Industrial property sales fell to $1 billion from $3 billion quarter-over-quarter, but industrial warehouse and logistics properties continued to attract interest with relatively attractive selling prices. And, downtown Toronto space recorded the strongest office-leasing performance.

“The industry has the potential to rebound in early 2024, depending on the central bank’s [interest] rate decisions and the effects of the monetary policy,” said Keith Reading, Toronto-based Morguard’s senior director of research, in a news release.

“The alleviation of inflationary pressures and adjustments in interest rates will remain pivotal in shaping the trajectory of Canada’s economy going forward.”

Retail investment was below $200 million, marking a five-year quarterly low.