Canada Investment Overview Q1 2023

We are delighted to present our first Canada investment overview. Our aim is for this quarterly overview to be your ultimate destination for the freshest updates, trends, and valuable insights in the ever-evolving realm of commercial real estate. We eagerly welcome your feedback on this edition, so please feel free to share your thoughts by leaving a comment.

First Quarter

In the first quarter of 2023, Canadian commercial real estate investment volumes experienced a rebound, reaching $14.7 billion. The increase was primarily driven by a significant merger and acquisition (M&A) transaction involving Summit Industrial Income REIT and Dream Industrial REIT, backed by Singapore’s GIC. This transaction accounted for $5.7 billion of the total investment activity, while single asset and portfolio transactions contributed $9.0 billion.

The industrial sector was the most active asset class during this period, recording $8.2 billion in total volumes, which represented 56.1% of the overall investment activity. The hotels sector was the only other asset class to see an increase in investment velocity compared to the previous quarter.

Foreign investors played a crucial role in the Canadian commercial real estate market during Q1 2023, accounting for more than half of the investment activity. This surge in foreign capital, driven by the M&A activity involving Singapore’s GIC, marked a significant recovery in cross-border investment in Canada. Private Canadian investors were the second most active buyer group, responsible for 29.8% of acquisitions.

The M&A deal between Summit Industrial Income REIT and Dream Industrial REIT, backed by Singapore’s GIC, significantly boosted cross-border investment into Canadian commercial real estate, reaching $5.3 billion in Q1 2023. This level of activity exceeded the total volumes recorded in the entirety of 2022 by 7.6%.

Seven out of the nine Canadian markets had a strong start to the year, surpassing their respective trailing three-year quarterly averages. Toronto, Montreal, and Vancouver were the leading markets in terms of investment activity, with volumes of $6.2 billion, $2.6 billion, and $1.4 billion, respectively. The only markets that experienced a decline in total volumes during Q1 2023 were Vancouver and Ottawa.


  • Canadian commercial real estate investment volumes rebounded in Q1 2023, reaching $14.7 billion, primarily driven by a significant M&A transaction and foreign investors’ surge, with the industrial sector leading the way.
  • Toronto, Montreal, and Vancouver were the top markets in terms of investment activity, while Vancouver and Ottawa experienced a decline in total volumes during the same period.

Amazon’s Vancouver office building put up for sale by pension funds

Two office buildings in Vancouver, owned by Canada’s Oxford Properties and the Canada Pension Plan Investment Board, with Amazon as one of the tenants, are being put up for sale, potentially marking the first significant office transaction in the country since April last year. The buildings, located at 402 Dunsmuir St. and 401 West Georgia St., are expected to fetch around $350 million. Office owners in Vancouver have been facing challenges due to higher borrowing costs and changing tenant preferences driven by remote work and layoffs.

The sale of these properties will provide insights into the current value of office towers in the evolving office market. The pension funds are looking to manage their exposure to Vancouver’s office market, and the decision to sell mature projects aligns with their nearing completion of a new office tower. Despite historically tight office market conditions in Vancouver, the rise in remote work has led to an increase in the vacancy rate, reaching 8.4% in the first quarter of the year.

Meanwhile, in the U.S., a report predicts a 35% decline in office building values by the end of 2025 due to the switch to remote or hybrid work, with a projected recovery period of at least 15 years.


  • Sale of two Vancouver office buildings by major pension funds suggests a potential recovery in the Canadian office market after last year’s freeze, impacted by rising borrowing costs and changing work dynamics.
  • The pension funds aim to manage their exposure and focus on new projects, as Vancouver’s office market faces increased vacancy rates due to remote work.
  • Remote work’s impact on office building values extends beyond Canada, with predictions of a 35% decline in the U.S. market by 2025 and a lengthy recovery period.



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