Q2, 2019
INDUSTRIAL MARKET REPORTStrong market fundamentals continue to fuel rental growth
The all-time low availability rate set in Q3 2018 was broken this quarter following a 10 basis points (bps) reduction to 1.5%. The average net asking lease rate increased by $0.52 per sq. ft. quarter-over-quarter to $7.67 per sq. ft., shattering last quarters record high number. Upward pressure on rental rates are expected to persist as many landlords continue to test the market with prominent listings marketed at a negotiable rate, while other landlords have increased their asking rates on active listings across their portfolio. As well, the average asking sale price climbed to new heights and appreciated to $201.08 per sq. ft. This increase represents a 3.6% quarter-over-quarter growth, marking the first time that the average asking sale price has risen above $200.00 per sq. ft.
Currently there is 9,575,843 sq. ft. under construction, which is the highest figure recorded since the 2008 recession. Only 41.1% of space under construction is being built on a speculative basis, marking a return to build-to-suit construction projects for larger
users in the market for prime warehouse space. New supply numbers for 2019 and 2020 are expected to reach unprecedented levels with a combined number exceeding 20.0 million sq. ft.
TORONTO WESTThe Toronto West availability rate fell by 40 bps quarter-over-quarter to a record low of 1.7%. Despite the decrease in availability, the vacancy rate saw a 10 bps quarter-over-quarter increase to 1.0%. The 1.0% figure is the second lowest rate ever recorded, surpassed only by last quarter. The average asking lease rate has surged to a new record high of $7.66 per sq. ft., accounting for a quarter-over-quarter increase of 6.8%, or $0.49 per sq. ft. This marks the eighth-consecutive quarter in which the average asking lease rate has increased. For the Toronto West market, the average asking lease rate’s year-over-year growth was 15.0%, which is 600 bps above Q1 2017 to Q1 2018’s growth of 9.0%. In comparison, the Greater Toronto Area (GTA) experienced year-over-year rental rate growth in Q1 2018 and Q1 2019 of 11.2% and 17.5%, respectively. Due to the slightly higher growth rate, the average net asking lease rate for the entire GTA is now $0.01 per sq. ft. greater than the Toronto West’s value of $7.66 per sq. ft.
The average net asking lease rate increased for an eighth consecutive quarter, hitting a record
high of $7.67 per sq. ft.
GTA Fundamentals - Historical Analysis
Net Absorption New Supply Availability Rate 10-Year Average Availability Rate
AVAI
LABI
LITY
RAT
E (%
)
NET A
BSOR
PTIO
N &
NEW
SUPP
LY (M
SF) 7
6
5
4
3
2
1
0
-1
-2
-3
7.0
6.0
5.0
4.0
3.0
2.0
1.0
0
-1
-2
-3
Q4 20
11
Q2 20
12
Q2 20
13Q1
2013
Q4 20
12
Q4 20
13
Q2 20
14Q3
2014
Q1 20
15
Q3 20
15
Q3 20
11
Q1 20
12
Q3 20
12
Q3 20
13
Q1 20
14
Q4 20
11
Q2 20
15
Q4 20
15Q1
2016
Q2 20
16
Q4 20
16Q1
2017
Q2 20
17
Q4 20
17Q3
2017
Q1 20
18Q2
2018
Q3 20
18Q4
2018
Q1 20
19
Q3 20
16
Avg. Ask Lease Rate$7.67 PER SQ. FT.
Avg. Ask Sale Price$201.08 PER SQ. FT.
Under Construction 9,575,843 SQ. FT.
New Supply1,161,192 SQ. FT.
*Arrows indicate change from previous quarter
BROCK ROAD & MCLEANP U S L I N C H, O N
• 25 - 33 acres• Divisible to 10 acres• Allows transportation• Quick 401 access• Located at 401 & Highway 6, 15 minutes
past Milton
• 9,352 sq.ft. on 0.56 acres• Small, well maintained freestand• Easy access to transit and highways 401 &
403 interchanges
1771 AIMCO BOULEVARDM I S S I S S AU G A , O N
• 94,875 sq. ft.• More than 4.5 acres of extra land• Roof replacement program in place• Multiple street access points• Ideal site configuration• Large shipping court
12833 HIGHWAY 50B O LTO N, O N
• 7,250 sq.ft. • Commercial space along busy highway 50
in Bolton• High traffic location next to major retailers• Yard space is fenced and secured• Perfect for equipment rental company,
contractor, building supplies
489 HIGHWAY 8H A M I LTO N, O N
• Turnkey transport terminal • Building set up for truck & trailer repair with
drive-in bays, wash bay & pit bay• Fully graveled, fenced & lit yard with 3 gated
access points• New Tim Hortons & Shell station across the
street
• 52,190 sq. ft. on 2.28 acres • Ideal user/investor opportunity• Sought after M2 zoning• 25,000 sq.ft. vacant on closing• Possibility to demise further to 4 x +/-13,000
sq. ft.
109 - 111 ADVANCE BOULEVARD | BRAMPTON | ON
• 45,000 sq.ft. for Sub-Lease• Central location • Access to Highway 401 & Downtown• High demand area• Good clear height• Anti-static floors & air-conditioned warehouse
95 BRIDGELAND AVENUEN O RT H YO R K , O N
340MAIN STREET NH A LTO N H I L L S , O N
• Halton Hills newest Industrial Park totaling 55 acres
• Hard to find rail access and outside storage• Lands available for sale or design build • Zoned EMP and fully serviced• Phase 1 complete. Phase 2 ready.
AVAILABLE FOR SALEGTA WEST INDUSTRIAL SALE STATS Q1 2019
5 - 10 YEAR COMMERCIAL MORTGAGE RATE
AVAILABLE FOR SALE (SQ.FT.)AVERAGE
ASKING PRICE (/SQ.FT.)INDUSTRIAL CAP RATE
3.19% - 3.96% 1,151,776 $183.00 5.00%
AVAILABLE LANDGTA WEST LAND STATS Q1 2019
AVERAGE LAND PRICE ($/ACRE)DEVELOPMENT CHARGES
MILTON BRAMPTON MISSISSAUGA ETOBICOKE
1,196,429 $18.08 $19.85 $23.35 $1.07
AVAILABLE FOR LEASEGTA WEST INDUSTRIAL LEASE STATS Q1 2019
TOTAL AVAILABLE (SQ. FT.) ABSORPTION YTD AVAILABILITY RATE AVERAGE ASKING RATE AVERAGE TMI
5,573,574 1,248,118 1.7% $7.66 $3.70
NEW
2390 SOUTH SERVICE ROADOA K V I L L E , O N
• 34,680 sq. ft. on 1.78 acres • Direct QEW exposure• Well maintained freestand• Very good shipping areaCO
NDITIO
NAL
CONDIT
IONAL
25 TYLER STREETC A M B R I D G E , O N
• +/- 51,332 sq. ft. • 28’ warehouse with ESFR sprinkler• Easy hwy access & hwy 401 exposure• Space can be divided - units starting at
20,000 sq. ft.• New construction | Fall 2019 delivery
65% L
EASE
D
1355 FEWSTER DRIVEM I S S I S S AU G A , O N 300,000 SQ. FT. INDUSTRIAL BUILDING
• 0.9 acres • Central Mississauga location • Site is fenced and secured• Good for truck parking, car storage,
equipment yard.• Small building on site• Close proximity to Pearson Airport
TRANMERE DRIVEM I S S I S S AU G A , O N6980
NEW
GOLDENHORSESHOE CRANES
HEAVY POWER RAIL
• 126,645 sq. ft. • Clean functional distribution space• Excellent bulk warehouse• 1 km from dock doors to Highway 401 & 409• Great shipping court with room for trailer
parking/storage
63 REXDALE BOULEVARD | TORONTO | ON
NEW
COMING SOON
9255 Airport Road, HAMILTON
77.70 acres
SOLD
195 Bethridge Road, TORONTO
70,900 sq. ft.
SOLD
14-16 Strathearn, #23-25, BRAMPTON
9,827 sq. ft.
LEASE
D
3267 Lenworth Drive, MISSISSAUGA
8,084 sq. ft.
SOLD
6590 Millcreek Drive, MISSISSAUGA
LEASE
D
225,694 sq. ft.
5228 Everest Drive, MISSISSAUGA
SOLD
25,567 sq.ft.
CBRE Limited Real Estate Brokerage | 5935 Airport Road | Suite 700 | Mississauga, ON | L4V 1W5 |T 416 674 7900 | F 416 674 6575
This disclaimer shall apply to CBRE Limited, Real Estate Brokerage, and to all other divisions of the Corporation (“CBRE”). The information set out herein, including, without limitation, any projections, images, opinions, assumptions and estimates obtained from third parties (the “Information”) has not been verified by CBRE, and CBRE does not represent, warrant or guarantee the accuracy, correctness and completeness of the Information. CBRE does not accept or assume any responsibility or liability, direct or consequential, for the Information or the recipient’s reliance upon the Information. The recipient of the Information should take such steps as the recipient may deem necessary to verify the Information prior to placing any reliance upon the Information. The Information may change and any property described in the Information may be withdrawn from the market at any time without notice or obligation to the recipient from CBRE. CBRE and the CBRE logo are the service marks of CBRE Limited and/or its affiliated or related companies in other countries. All other marks displayed on this document are the property of their respective owners. All Rights Reserved. Mapping Sources: Canadian Mapping Services [email protected]; DMTI Spatial, Environics Analytics, Microsoft Bing, Google Earth
*Sales Representative
FOR MORE INFORMATION PLEASE CONTACT:
RECENT CLIENT SUCCESS STORIES
TED OVERBAUGH*Vice President416 798 [email protected]
JOHN PLANETA*Senior Vice PresidentGlobal Integrated Logistics416 798 [email protected]
GRACE KISHANDER*Team Lead, Real Estate Services416 798 [email protected]
SAVREEN DHILLONMarketing Assistant416 798 [email protected]
835 Intermodal Drive, BRAMPTON
66,874 sq. ft.
LEASE
D
6115 Danville Road, MISSISSAUGA
34,137 sq. ft.
LEASE
D