ORONTO - In its Industrial Real Estate Market Research study published today, Newmark Knight Frank Devencore reported that availability rates in the Greater Toronto Area's dynamic industrial market have dropped to 3.4%, a historic low. This low availability rate has been reached despite the 3.3 million square feet of new inventory that was delivered to the GTA industrial marketplace over the past six months. Year over year, the total inventory of industrial space has increased by over 8 million square feet. Average asking gross rents have also increased over the past year by just over 8% and are currently at approximately $10.55/SF.
"Momentum remains strong across the GTA and, in particular, Toronto West, the GTA's largest industrial submarket," said Rob Renaud, Managing Principal/Broker of Record at Newmark Knight Frank Devencore's Toronto West office1. "Demand is significant in Mississauga because it is ideally situated at the crossroads of most of the GTA's major transportation routes and because of its inventory of modern industrial space. Locating larger blocks of space is a challenge here, and those that do become available are usually leased or purchased quickly."
The Newmark Knight Frank Devencore study notes that total available rates in the overall GTA industrial market over the next year will be strongly influenced by whatever activity may take place in specific Toronto West regions such as Milton, Caledon and Halton Hills, all of which have an available inventory of industrial space that is substantially higher than the GTA average. Over 4 million square feet of space has been recently delivered or is under construction in the Milton/Halton Hills area.
"Looking ahead, with approximately 5.6 million square feet currently under construction, industrial tenants will have many options," Mr. Renaud said. "However, there are fewer major speculative developments currently being planned, which may lead to a further tightening of the market. Additionally, the recent U.S. elections could have a negative impact on the industrial marketplace going forward, especially if NAFTA is renegotiated and the Trans-Pacific Partnership agreement is abandoned as stated by the incoming US administration. Should interest rates also creep upward, the GTA's manufacturing and distribution economy could continue to face additional challenges."
To read the complete market study, please go to: /home/market-information.aspx?d=716
About Newmark Knight Frank Devencore
As part of Newmark Grubb Knight Frank, one of the world's leading commercial real estate advisory firms, Newmark Knight Frank Devencore is Canada's largest corporate real estate advisor and brokerage, exclusively representing corporate, industrial and retail space users. With offices across the country, Newmark Knight Frank Devencore offers its global clientele comprehensive services that are individually designed to ensure executive real estate decisions are supported by effective strategies and professional execution. To learn more about our capabilities, please visit www.devencorenkf.com.
About Newmark Grubb Knight Frank
Newmark Grubb Knight Frank is one of the world's leading commercial real estate advisory firms. Together with London-based partner Knight Frank and independently-owned offices, NGKF's 14,100 professionals operate from more than 400 offices in established and emerging property markets on six continents.
With roots dating back to 1929, NGKF's strong foundation makes it one of the most trusted names in commercial real estate. NGKF's full-service platform comprises BGC's real estate services segment, offering commercial real estate tenants, landlords, investors and developers a wide range of services including leasing; capital markets services, including investment sales, debt placement, appraisal, and valuation services; commercial mortgage brokerage services; as well as corporate advisory services, consulting, project and development management, and property and corporate facilities management services. For further information, visit www.ngkf.com.
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For further information, contact:
Managing Principal/Broker of Record
416-366-0366, ext. 241
Newmark Knight Frank Devencore
1 Devencore Realties Corporation
(Toronto West) Ltd., Brokerage
1 Eva Road, Suite 409
Toronto, Ontario M9C 4Z5