Market Report
Toronto Industrial Market Report
3Q 2026
Industrial Fundamentals in Toronto Firm
Amid Growing Economic Risks
Demand begins to catch up. Toronto’s industrial market has spent the past several years recalibrating following the exceptional tightness of the pandemic era. A wave of new supply, softer leasing, and tenant consolidations pushed vacancy from just 0.5 per cent in 2022 to 3.1 per cent by 2025, while asking rents continue to decline from their 2023 peak. Conditions are now improving, however, as leasing momentum rebuilds and the recent supply wave is gradually absorbed. Vacancy fell to 2.7 per cent in the second quarter of 2026, while first-half absorption reached 5.5 million square feet, positioning the market for a more balanced second half.
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