Market Report

Q2 2025
Commercial Real Estate for
Peel, Halton & Hamilton Regions

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Overview

In the second quarter of 2025, the commercial real estate markets across Halton, Hamilton, and Peel reflected broader GTA trends of cautious optimism and strategic adaptation. Sales remained selective amid continuing economic uncertainty driven by tariffs and trade barriers. While leasing, the more stable and risk-averse approach, stayed relatively active, industrial and office sales slowed and focused on quality properties that suit specific needs. The commercial land market in these regions had both low volume and prices.

Landlords looked to find different ways to incentivize tenants without reducing their own longer-term economic gains. Large institutional landlords are tending towards higher initial rental rates, but increased use of tenant improvement allowance and free rent incentives. Some smaller and private landlords have used lower initial rates to drive interest in the properties, while utilizing increased escalations to help equalize the long-term value over the term of the lease.

Office leasing across the region was steady but selective. Demand is concentrated in quality, well-located suburban assets. Landlords are investing in upgrades and offering adaptable lease terms to close deals, as tenants continue to refine their workplace strategies.

Office sales activity is limited, while prices stayed relatively steady quarter over quarter, with a focus on leasing potential and adaptability to future workplace needs, as well as owner-occupier groups taking advantage of low prices.

Tenant leverage has grown in the industrial leasing market as availability rises. Asking net rents are declining, and the high availability of newer buildings has added downward pressure. Tenants are seeking flexibility, and landlords are responding with softer escalations, free rent periods, and increased TI packages to maintain occupancy.

Sales activity in the industrial market has slowed, with cautious buyer sentiment amid rising vacancies and pricing recalibration. However, demand for well-located, functional product remains. Investor focus has shifted to assets that offer long-term income stability and potential for future repositioning as the market rebalances.

For land sales, both sale prices and volume have decreased dramatically year on year, as economic uncertainty remains a large threat to investments projects. Buyers remain on the sidelines, waiting for clarity around development feasibility while sellers are reluctant to adjust valuations.