Population growth continues to fuel the commercial real estate sector, as investors proceed with caution and creativity as they navigate economic uncertainty, according to a new report by Re/Max Canada.
Re/Max’s 2025 Commercial Real Estate Report, which examined first-quarter activity across 12 major markets, found that Canada’s commercial investors are capitalizing on opportunities that allow them to adapt their portfolios to escalating glocal tensions and economic concerns.
“Canada’s commercial real estate market is shifting to fundamentals this year,” said Don Kottick, Re/Max Canada president. “What we’re seeing is a pivot to purpose and practicality, prompting revitalization, a flight to quality, and a more discerning buyer pool.”
Institutional investors and Real Estate Investment Trusts (REIT) are cautiously re-entering the market, focused on acquisition, “as they target assets that promise long-term value in today’s more complex operating environment,” Kottlick added.
Shelter and industrial lead retail
Multi-family and industrial were the top-performing asset classes, followed by retail, according to the report.
“Commercial markets continue to move forward at a steady pace, fuelled by ongoing pressure on the country’s existing housing stock, government policies set to advance growth, such as the Housing Accelerator Fund, and a continued upswing in e-commerce sales.”
Which provinces are performing best?
Canada’s commercial activity is most robust in the Prairies and the East Coast, Re/Max’s report found.
Western Canada’s commercial markets, alongside Newfoundland and Labrador, led the country in commercial growth in 2025, buoyed by increasing population, greater investment activity, and solid economic performance, said Re/Max.
Steady immigration and interprovincial migration in Alberta, Saskatchewan and Manitoba helped spur expansion, with shortages reported in several asset classes, said Re/Max.
Newfoundland Labrador’s growing pipeline of resource and infrastructure projects is helping the province enter a period of renewed economic momentum.
Population pressures driving multi-family construction
Population growth continues to propel the multi-family asset class, said Kottick.
“Bolstered by public policy, both private and public investment is driving a resurgence in the construction of purpose-built rentals nationwide, while demand remains strong for existing portfolios.”
Industrial is the backbone of the commercial sector, with growing strength in the country’s logistics corridors.
While smaller, traditional malls continue to experience challenges, overall retail is resilient, with neighbourhood nodes outperforming, especially those anchored by essential shops and services.
“Although growing pains are expected, commercial markets are ultimately positioned for growth once the market shakes current transitory challenges and clarity emerges,” said Re/Max.
