Investment in Canadian commercial real estate is expected to rebound in 2026, with total transaction volume potentially reaching about $56 billion, according to CBRE’s Canada Real Estate Market Outlook.
CBRE forecasts property sales volume will rise by more than eight per cent next year. When merger and acquisition activity and portfolio deals are included, total investment could increase from an estimated $47 billion in 2025 to roughly $56 billion in 2026, which would rank as the third-highest annual total on record for Canadian commercial real estate.
International and domestic capital returning
CBRE says the projected rebound reflects renewed interest from both international and domestic investors following a period of uncertainty.
Jon Ramscar
“We’re coming off a year of uncertainty, but international capital has already voted in favour of Canadian commercial real estate,” said Jon Ramscar, president and chief executive of CBRE Canada. “We have seen assets purchased across the country due to our strong fundamentals and relative stability. In 2026 we expect widespread and competitive participation from all sources of capital, domestic and international. Not to mention that the resurgent office market will spur transactions and our retail market remains solid.”
The outlook contrasts commercial real estate with the housing market, where sales activity has declined, while investment interest in income-producing property is showing signs of recovery.
Office market sentiment improves
CBRE reports that the office sector is moving out of a period of volatility and into what it describes as sustained growth. After two years of positive net absorption and a peak in national vacancy, the market has stabilized.
Improving fundamentals have led to a substantial shift in investor sentiment toward office properties, according to the report. CBRE attributes part of that change to return-to-office mandates across both public and private sectors.
The firm says debt markets have become more receptive to office assets, particularly high-quality Class A properties. As a result, office investment volumes are expected to rebound toward levels more consistent with the sector’s historical share of overall commercial real estate activity.
Seniors housing seen as multifamily growth area
Within the multifamily category, CBRE identifies seniors housing as a key area of strength over the coming years.
The outlook points to strong market fundamentals, with a rapidly aging Canadian population creating sustained demand for seniors housing assets. CBRE expects that demand to support double-digit rent growth that exceeds expense growth.
Despite rising demand, the report says new supply is likely to remain limited. CBRE notes a significant gap between current market rents and the rent levels required to make new seniors housing construction financially viable.
As a result, CBRE expects competition for existing seniors housing assets to intensify in 2026 and beyond as more investors seek exposure to the sector.
Industrial market approaches inflection point
CBRE describes industrial market fundamentals as largely balanced heading into 2026, with conditions moving toward what it characterizes as an inflection point.
Demand for industrial space is expected to strengthen, with net absorption forecast to rebound to more than 20 million square feet in 2026. That level would bring activity back in line with national pre-pandemic norms, according to the outlook.
The report also flags trade policy as a continuing concern for the industrial sector. CBRE notes that a review of the Canada–United States–Mexico Agreement is scheduled for July and says the resilience of the Canadian economy in the face of U.S. tariffs to date has been largely supported by the agreement. Its preservation, the report says, is critical to stabilizing the industrial market.
Retail market stabilizes
CBRE says the retail sector is entering 2026 on a more stable footing compared with the previous year, though performance is expected to vary significantly by location.
According to the outlook, overall retail performance will remain highly localized and dependent on geographic factors. Secondary and tertiary markets are identified as trending positively, with greater potential for growth than larger urban centres.
CBRE adds that many major retail brands are responding to demographic shifts and infrastructure investment by expanding into new or previously untapped markets across Canada.
Outlook tied to broader investment recovery
Taken together, CBRE’s outlook suggests that improving sentiment across major asset classes could support a broader recovery in Canadian commercial real estate investment next year.
The firm’s forecast points to increased transaction activity driven by a combination of stabilizing market fundamentals, improving access to capital and renewed participation from a wide range of investors.
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Entrepreneur. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 and 2024 as one of the top business journalists in the world by PR News. He was also named by RETHINK to its global list of Top Retail Experts 2024, 2025 and 2026.
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