GTA Industrial Market Report - Q3 2026

Leasing Market: Flashbacks of 2021

The GTA industrial market is behaving like 2021 to 2023 again. Demand is back, availability continues to tighten, and new supply is running thin.

Absorption and availability: 1.9 million sq. ft. came off the market in Q3, bringing the year-to-date total to 8 million sq. ft. That is already ahead of all of 2025. Availability sits at 4.2%, down 30 basis points from 4.5% last quarter and also down year over year.

Rents: Asking net rent has held in the $16 range for a year and a half, since Q2 2025. It currently sits at $16.04 per sq. ft., down 19 cents from the previous quarter.

Who is driving demand: 3PL operators are leading, followed by new entrants from China, who have taken more than 2 million sq. ft. That is about 15% of absorption over the past 12 months.

Why falling rents are misleading: Flight to quality is shrinking the supply of modern space. The average asking rate is slipping because less new product is reaching the market. Available inventory now skews toward second-generation and large-block space, which drags down the average. The decline reflects a change in the mix of inventory, not weak demand.

Submarkets: GTA West accounts for the vast majority of leasing and absorption, with 1.9 million sq. ft. absorbed. Central, East, and North GTA are relatively flat.

Supply: Only 4.7 million sq. ft. has been delivered so far this year, which puts 2026 on pace for the lowest annual supply since 2019. A 7-year low in new construction tells a clear story about the next 2 to 3 years. Developers are already hunting for land, and 8.5 million sq. ft. is under construction. If the pipeline stays constrained in 2027, a new development cycle begins in 2028. Until then, quality product will stay thin and rates will adjust accordingly.

Sale Market: Momentum Up, Prices Flat

Activity: 73 sales were recorded, up from 68 in Q2 and 65 a year ago.

Pricing by size band:

• Under 25,000 SF: $402 PSF (-5% YoY)
• 25,000 to 50,000 SF: $304 PSF (-17% YoY)
• 50,000 to 100,000 SF: $219 PSF (-24% YoY)
• 100,000 SF and over: $253 PSF (+6% YoY)

Where deals happened:

• Halton surged to 19 sales, led by Burlington and Oakville, from 5 in Q2 and 4 a year ago.
• York led on dollars at $365M, driven by a $115M Vaughan trade and the $62M Aviva Park sale.
• Toronto was the soft spot, with 18 sales and $195M against 26 and $507M a year ago. Pricing came in at $243 PSF versus $281.
• Peel held at 20 sales. Mississauga's median was $391 PSF, up from $372 a year ago.

Product: Buildings with 24' clear or higher were 19% of sales, down from 29% in Q2 2026 and 33% a year ago. Buyers are trading older, lower-clear stock, which matches the thin supply of modern product in the leasing market.