The Commercial Realty Watch is now published on a quarterly basis.
Over Three Million Square Feet of Leased Space in Q1
April 4, 2012 — Toronto Real Estate Board (TREB) Commercial Division Members leased almost 3.1 million square feet of commercial space through the TorontoMLS system in the first quarter of 2012. This result represented a ten per cent decline compared to the first quarter of 2011. Industrial leasing generally accounts for the great majority of commercial lease transactions through the TorontoMLS system. This remained the case in the first quarter with leased industrial square footage accounting for 77 per cent of total leased space. The average lease rate for industrial transactions completed on a per square foot net basis and for which pricing was disclosed was $4.90 – up three per cent compared to the first quarter of 2011.
“While the past year has been marked by economic uncertainty, we continued to see growth in the Canadian economy. Over the past few months, we have also heard more good economic news than bad, both in the Canadian context and in relation to major trading partners like the United States. The result has been a respectable level of leasing activity and a moderate gain in the average lease rate on a per square foot net basis,” said Commercial Division Chair person.
There were 233 total commercial sales in the first quarter of this year – down by almost seven per cent compared to the first three months of 2011. Broken out by type, sales of industrial and other commercial types were down by 4.5 and 9.5 per cent respectively compared to 2011. Average sale prices per square foot for transactions with pricing disclosed were down for both the industrial and other commercial categories.
“The dip in average sale prices was due to a change in the composition of sales in both the industrial and other commercial categories this year compared to last. In both cases, a much higher share of first quarter 2012 deals were for larger sized properties, which generally sell for a lower price per square foot,”.