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TORONTO, July 12, 2017 — Toronto Real Estate Board President Tim Syrianos announced commercial leasing and sale statistics reported through TREB’s MLS® System during the second quarter of 2017.
TREB Commercial Network Members reported more than 6.5 million square feet of industrial, commercial/retail and office space leased through TREB’s MLS® system in Q2 2017. This result represented a 10.7 per cent dip in comparison to more than 7.3 million square feet reported leased in Q2 2016.
Approximately three quarters of total space leased was accounted for by the industrial market segment, with deals completed on over 4.9 million square feet – down from more than 5.6 million square feet in Q2 2016.
Year-over-year changes in average lease rates reported on a per square foot net basis for transactions with pricing disclosed were mixed. The average industrial and commercial lease rates were up by 10.7 per cent and 21.8 per cent respectively to $ 6.11 and $ 21.46. The average office lease rate was down by 8.3 per cent to $ 13.98. While changing market conditions obviously influence changes in average lease rates on a year-over-year basis, so too do changes in the mix of properties sold from one year to the next, in terms of size, type and location.
“By all accounts, the Canadian and GTA economy seems to be performing quite well. In the GTA, the unemployment rate remains low from a historic perspective. However, concerns do still exist with regard to sustained growth in the level of exports and business investment, which is especially important to the industrial market segment. Sustained growth in these areas of the economy moving forward, will likely correlate with sustained growth in commercial real estate transactions,” said Mr. Syrianos.
Combined industrial, commercial/retail and office sales reported by TREB Commercial Network Members amounted to 304 in Q2 2017 – down from a total of 390 sales reported in Q2 2016. Average sale prices on a per square foot basis for transactions with pricing disclosed were up for the industrial and office market segments, and down for the commercial/retail segment. Similar to the leasing market, year-over-year changes in average selling prices can be due to both changes in market conditions and changes in the mix of properties sold.