Q2, 2019

INDUSTRIAL MARKET REPORTStrong market fundamentals continue to fuel rental growth

The all-time low availability rate set in Q3 2018 was broken this quarter following a 10 basis points (bps) reduction to 1.5%. The average net asking lease rate increased by $0.52 per sq. ft. quarter-over-quarter to $7.67 per sq. ft., shattering last quarters record high number. Upward pressure on rental rates are expected to persist as many landlords continue to test the market with prominent listings marketed at a negotiable rate, while other landlords have increased their asking rates on active listings across their portfolio. As well, the average asking sale price climbed to new heights and appreciated to $201.08 per sq. ft. This increase represents a 3.6% quarter-over-quarter growth, marking the first time that the average asking sale price has risen above $200.00 per sq. ft.

Currently there is 9,575,843 sq. ft. under construction, which is the highest figure recorded since the 2008 recession. Only 41.1% of space under construction is being built on a speculative basis, marking a return to build-to-suit construction projects for larger

users in the market for prime warehouse space. New supply numbers for 2019 and 2020 are expected to reach unprecedented levels with a combined number exceeding 20.0 million sq. ft.

TORONTO WESTThe Toronto West availability rate fell by 40 bps quarter-over-quarter to a record low of 1.7%. Despite the decrease in availability, the vacancy rate saw a 10 bps quarter-over-quarter increase to 1.0%. The 1.0% figure is the second lowest rate ever recorded, surpassed only by last quarter. The average asking lease rate has surged to a new record high of $7.66 per sq. ft., accounting for a quarter-over-quarter increase of 6.8%, or $0.49 per sq. ft. This marks the eighth-consecutive quarter in which the average asking lease rate has increased. For the Toronto West market, the average asking lease rate’s year-over-year growth was 15.0%, which is 600 bps above Q1 2017 to Q1 2018’s growth of 9.0%. In comparison, the Greater Toronto Area (GTA) experienced year-over-year rental rate growth in Q1 2018 and Q1 2019 of 11.2% and 17.5%, respectively. Due to the slightly higher growth rate, the average net asking lease rate for the entire GTA is now $0.01 per sq. ft. greater than the Toronto West’s value of $7.66 per sq. ft.

The average net asking lease rate increased for an eighth consecutive quarter, hitting a record

high of $7.67 per sq. ft.

GTA Fundamentals - Historical Analysis

Net Absorption New Supply Availability Rate 10-Year Average Availability Rate

AVAI

LABI

LITY

RAT

E (%

)

NET A

BSOR

PTIO

N &

NEW

SUPP

LY (M

SF) 7

6

5

4

3

2

1

0

-1

-2

-3

7.0

6.0

5.0

4.0

3.0

2.0

1.0

0

-1

-2

-3

Q4 20

11

Q2 20

12

Q2 20

13Q1

2013

Q4 20

12

Q4 20

13

Q2 20

14Q3

2014

Q1 20

15

Q3 20

15

Q3 20

11

Q1 20

12

Q3 20

12

Q3 20

13

Q1 20

14

Q4 20

11

Q2 20

15

Q4 20

15Q1

2016

Q2 20

16

Q4 20

16Q1

2017

Q2 20

17

Q4 20

17Q3

2017

Q1 20

18Q2

2018

Q3 20

18Q4

2018

Q1 20

19

Q3 20

16

Avg. Ask Lease Rate$7.67 PER SQ. FT.

Avg. Ask Sale Price$201.08 PER SQ. FT.

Under Construction 9,575,843 SQ. FT.

New Supply1,161,192 SQ. FT.

*Arrows indicate change from previous quarter

BROCK ROAD & MCLEANP U S L I N C H, O N

• 25 - 33 acres• Divisible to 10 acres• Allows transportation• Quick 401 access• Located at 401 & Highway 6, 15 minutes

past Milton

• 9,352 sq.ft. on 0.56 acres• Small, well maintained freestand• Easy access to transit and highways 401 &

403 interchanges

1771 AIMCO BOULEVARDM I S S I S S AU G A , O N

• 94,875 sq. ft.• More than 4.5 acres of extra land• Roof replacement program in place• Multiple street access points• Ideal site configuration• Large shipping court

12833 HIGHWAY 50B O LTO N, O N

• 7,250 sq.ft. • Commercial space along busy highway 50

in Bolton• High traffic location next to major retailers• Yard space is fenced and secured• Perfect for equipment rental company,

contractor, building supplies

489 HIGHWAY 8H A M I LTO N, O N

• Turnkey transport terminal • Building set up for truck & trailer repair with

drive-in bays, wash bay & pit bay• Fully graveled, fenced & lit yard with 3 gated

access points• New Tim Hortons & Shell station across the

street

• 52,190 sq. ft. on 2.28 acres • Ideal user/investor opportunity• Sought after M2 zoning• 25,000 sq.ft. vacant on closing• Possibility to demise further to 4 x +/-13,000

sq. ft.

109 - 111 ADVANCE BOULEVARD | BRAMPTON | ON

• 45,000 sq.ft. for Sub-Lease• Central location • Access to Highway 401 & Downtown• High demand area• Good clear height• Anti-static floors & air-conditioned warehouse

95 BRIDGELAND AVENUEN O RT H YO R K , O N

340MAIN STREET NH A LTO N H I L L S , O N

• Halton Hills newest Industrial Park totaling 55 acres

• Hard to find rail access and outside storage• Lands available for sale or design build • Zoned EMP and fully serviced• Phase 1 complete. Phase 2 ready.

AVAILABLE FOR SALEGTA WEST INDUSTRIAL SALE STATS Q1 2019

5 - 10 YEAR COMMERCIAL MORTGAGE RATE

AVAILABLE FOR SALE (SQ.FT.)AVERAGE

ASKING PRICE (/SQ.FT.)INDUSTRIAL CAP RATE

3.19% - 3.96% 1,151,776 $183.00 5.00%

AVAILABLE LANDGTA WEST LAND STATS Q1 2019

AVERAGE LAND PRICE ($/ACRE)DEVELOPMENT CHARGES

MILTON BRAMPTON MISSISSAUGA ETOBICOKE

1,196,429 $18.08 $19.85 $23.35 $1.07

AVAILABLE FOR LEASEGTA WEST INDUSTRIAL LEASE STATS Q1 2019

TOTAL AVAILABLE (SQ. FT.) ABSORPTION YTD AVAILABILITY RATE AVERAGE ASKING RATE AVERAGE TMI

5,573,574 1,248,118 1.7% $7.66 $3.70

NEW

2390 SOUTH SERVICE ROADOA K V I L L E , O N

• 34,680 sq. ft. on 1.78 acres • Direct QEW exposure• Well maintained freestand• Very good shipping areaCO

NDITIO

NAL

CONDIT

IONAL

25 TYLER STREETC A M B R I D G E , O N

• +/- 51,332 sq. ft. • 28’ warehouse with ESFR sprinkler• Easy hwy access & hwy 401 exposure• Space can be divided - units starting at

20,000 sq. ft.• New construction | Fall 2019 delivery

65% L

EASE

D

1355 FEWSTER DRIVEM I S S I S S AU G A , O N 300,000 SQ. FT. INDUSTRIAL BUILDING

• 0.9 acres • Central Mississauga location • Site is fenced and secured• Good for truck parking, car storage,

equipment yard.• Small building on site• Close proximity to Pearson Airport

TRANMERE DRIVEM I S S I S S AU G A , O N6980

NEW

GOLDENHORSESHOE CRANES

HEAVY POWER RAIL

• 126,645 sq. ft. • Clean functional distribution space• Excellent bulk warehouse• 1 km from dock doors to Highway 401 & 409• Great shipping court with room for trailer

parking/storage

63 REXDALE BOULEVARD | TORONTO | ON

NEW

COMING SOON

9255 Airport Road, HAMILTON

77.70 acres

SOLD

195 Bethridge Road, TORONTO

70,900 sq. ft.

SOLD

14-16 Strathearn, #23-25, BRAMPTON

9,827 sq. ft.

LEASE

D

3267 Lenworth Drive, MISSISSAUGA

8,084 sq. ft.

SOLD

6590 Millcreek Drive, MISSISSAUGA

LEASE

D

225,694 sq. ft.

5228 Everest Drive, MISSISSAUGA

SOLD

25,567 sq.ft.

CBRE Limited Real Estate Brokerage | 5935 Airport Road | Suite 700 | Mississauga, ON | L4V 1W5 |T 416 674 7900 | F 416 674 6575

This disclaimer shall apply to CBRE Limited, Real Estate Brokerage, and to all other divisions of the Corporation (“CBRE”). The information set out herein, including, without limitation, any projections, images, opinions, assumptions and estimates obtained from third parties (the “Information”) has not been verified by CBRE, and CBRE does not represent, warrant or guarantee the accuracy, correctness and completeness of the Information. CBRE does not accept or assume any responsibility or liability, direct or consequential, for the Information or the recipient’s reliance upon the Information. The recipient of the Information should take such steps as the recipient may deem necessary to verify the Information prior to placing any reliance upon the Information. The Information may change and any property described in the Information may be withdrawn from the market at any time without notice or obligation to the recipient from CBRE. CBRE and the CBRE logo are the service marks of CBRE Limited and/or its affiliated or related companies in other countries. All other marks displayed on this document are the property of their respective owners. All Rights Reserved. Mapping Sources: Canadian Mapping Services canadamapping@cbre.com; DMTI Spatial, Environics Analytics, Microsoft Bing, Google Earth

*Sales Representative

FOR MORE INFORMATION PLEASE CONTACT:

RECENT CLIENT SUCCESS STORIES

TED OVERBAUGH*Vice President416 798 6272ted.overbaugh@cbre.com

JOHN PLANETA*Senior Vice PresidentGlobal Integrated Logistics416 798 6223john.planeta@cbre.com

GRACE KISHANDER*Team Lead, Real Estate Services416 798 6252grace.kishander@cbre.com

SAVREEN DHILLONMarketing Assistant416 798 6279savreen.dhillon@cbre.com

835 Intermodal Drive, BRAMPTON

66,874 sq. ft.

LEASE

D

6115 Danville Road, MISSISSAUGA

34,137 sq. ft.

LEASE

D