Despite complications from the COVID-19 pandemic, the Toronto commercial real estate market has experienced some unforeseen growth. Transactions during Quarter 1 of 2020 in the city went up 5% overall.
While the true impact of social distancing and the quarantine wonâ€™t be seen until Quarter 2â€™s data, we can still see how the cityâ€™s real estate market will fare, especially for the commercial sector. You can check Toronto Restaurants for Sale during this time as well.
High Sales in the GTA
Up until now, the value of the GTAâ€™s Quarter 1 market was $3.9 billion, the result of an 8% increase year-to-year. The total volume of sales went up as well by 12%, resulting in 318 transactions.
GTA apartment sales have grown the most during this quarter with a 49% year-over-year increase to a $1.2 billion value. The biggest sale was a $102 million transaction of 175 Wynford Drive-by Freed Developments.
The company plans to build two residential towers in this area, which will benefit from the proximity to Don Valley Highway and the Eglinton Crosstown Light Rail Transit line.
Another major transaction was 229 Richmond Street West in Old Toronto. This ICI Land investment was valued at $100 million. The City of Toronto itself purchased this land to build a park on site.
A noteworthy residential land purchase is 200 Queens Quay West, also in Old Toronto. Canada Lands Company sold the parkade to DiamondCorp and Lifetime Developments for $100 million. High-density residential development is the target of this buy.
Changes in nearby regions
The rise of commercial properties in the Greater Toronto Area (GTA) has impacted many municipalities, including rises and falls in:
- Peel region with a $205 million gain and a 35% increase in sales.
- Toronto region with a $105 million gain and a 5% increase in sales.
- Durham region with a $9 million gain and a 6% increase in sales.
- Halton region with a $16 million loss and a 6% decrease in sales.
- York region with a $16 million loss and a 3% decrease in sales.
Toronto remains the largest region by total property sales with a value of $2.2 billion overall, well over double that of other regions. Investors greatly prefer Toronto, but buyer momentum still declined from the previous quarter.
Sales by type of property
Itâ€™s important to consider the types of properties being sold as well. Different markets are seeing changes directly related to COVID-19.
Apartments, rentals, house lots, commercial land, and rural land all went up during the pandemic, while offices, industrial lands, residential lands, and retail saw decreases.
COVID-19 has forced many businesses to abandon their office spaces in favor of working from home. Shopify, for instance, has become completely remote until 2021 according to its CEO Tobi Lutke.
Commercial spaces like warehouses will likely rise in sales on the other hand. Inventory storage is becoming more important than ever thanks to the strain on global supply chains due to COVID-19. Plus, the de-globalization promoted by the pandemic will encourage companies to keep their stock within the borders.
The CHI real estate advantage
Take advantage of these changes in the commercial real estate market in Toronto by working with one of the most experienced teams in the city. CHI Real Estate will connect you with our advisors to help you find the best leases for your case.
Even when the quarantine has made the industry unpredictable, there are plenty of growths and transactions to take advantage of. CHIâ€™s experience in the restaurant, hospitality, and commercial markets will boost the success rate of your investment or franchising plans.