Q1, 2019

INDUSTRIAL MARKET REPORTGTA rents rise to historic highs

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

Q3 20

16

Avg. Ask Lease Rate$7.15 PER SQ. FT.

Avg. Ask Sale Price$194.04 PER SQ. FT.

Under Construction 6,599,733 SQ. FT.

New Supply931,508 SQ. FT.

*Arrows indicate change from previous quarter

Market conditions in the Greater Toronto Area (GTA) remain extremely tight with the availability rate maintaining its record low value of 1.6% & the vacancy rate posting an all-time low of 0.6%.

For the first time in history, the average asking lease rate for the GTA has risen above $7.00 per sq. ft., appreciating to $7.15 per sq. ft. This represents an 11.4%, or $0.73 per sq. ft., year-over-year increase. The $0.73 per sq. ft. nominal value marks the largest year-over-year absolute change ever recorded in the GTA. Upward pressure on rental rates are expected to persist in 2019. Due to increasing rental rates and a lack of available space, some landlords, mainly institutional owners, are seeking longer lease terms. This has resulted in an average lease term of 66 months for deals exceeding 25,000 sq. ft. in 2018. Comparatively, the average lease term was recorded at 62 months in both 2016 and 2017. Moreover, brokers are finding that deal

consummation is taking longer than in previous years as tenants become acclimated to the changing market. Larger tenants are leveraging their covenant, position and relationship with owners as an attempt to lower their rent. Other contributing factors for a prolonged deal consummation include procurement and design for automation and upstream contract executions.

The year closes with 5,752,487 sq. ft. of new supply introduced to the GTA. This number exceeds both the year - end 2016 and 2017 numbers of 4,706,368 sq. ft. and 3,918,570 sq. ft., respectively. Currently, there is 6,599,733 sq. ft. of new supply under construction.

Recently, developers have announced their intentions to have further speculative builds in Halton Hills, Milton, Oshawa and Whitby by year-end 2020. Although much of these developments have yet to break ground, it is expected these projects will introduce over 3 million sq. ft. on a pure speculative basis in the aforementioned markets. More than ever, tertiary markets are being viewed as viable options as developable land in primary markets are further limited. Concerns for a sustainable labour pool in these markets are expected to be mitigated by automation advancements that offset the need for a large workforce.

The average net asking lease rate increased for a seventh consecutive quarter, hitting a

record high of $7.15 per sq. ft.

340 MAIN STREET N | HALTON HILLS | ON

• 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.

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

4 ALFRED KUEHNE BOULEVARDB R A M P TO N, O N

• Flexible sizes: 2,750 sq. ft. - 12,500 sq. ft.• Truck level & drive-in shipping• Building upgrades: New roof & asphalt,

landscaping work, exterior LEDs• 18’ clear height• GO station next door• Rare M2 zoning

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

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

AVAILABLE FOR SALEGTA WEST INDUSTRIAL SALE STATS Q1 2019

AVERAGE MORTGAGE RATE

AVAILABLE FOR SALE (SQ.FT.)

AVERAGE ASKING PRICE (/SQ.FT.)

INDUSTRIAL CAP RATE CLOSED TRANSACTIONS

3.95% 1,048,818 $186.45 5.17% 39

AVAILABLE LAND

GTA WEST LAND STATS Q1 2019

AVERAGE LAND PRICE ($/ACRE)DEVELOPMENT CHARGES

MILTON BRAMPTON MISSISSAUGA ETOBICOKE

1,196,429 $17.20 $19.25 $22.63 $1.07

• 40 acres of great buy and hold opportunity• Located next to major industrial

developments• Significant local infrastructure improvements

underway• Close to planned 401/Tremaine interchange• Full municipal services nearby• Existing house and shop onsite

7201 5 SIDE ROAD

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

403 interchanges

NEW

1355 FEWSTER DRIVEM I S S I S S AU G A , O N

H A LTO N H I L L S , O N

12833 HIGHWAY 50B O LTO N, O N

• 7,250 sq.ft. for lease• Commercial space along busy • Hwy 50 in Bolton• High traffic location next to major retailers• Yard space is fenced and secured• Perfect for equipment rental company,

contractor, building supplies

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

• +/- 143,695 sq. ft. for lease• 28’ warehouse with ESFR sprinkler• Easy hwy access & hwy 401 exposure• Space can be divided - units starting at

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

• 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 AVENUE | NORTH YORK | ON

• 2,830 sq.ft. for lease • Quick access to 400 series highways• Abundant parking• Access to transit, BRT & many amenities• 4 private offices

5535 EGLINTON AVENUE W. SUITE 218TO R O N TO, O N

AVAILABLE FOR LEASE

GTA WEST INDUSTRIAL LEASE STATS Q1 2019

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

6,694,067 7,524,369 2.1% $7.17 $3.55

INDUSTRIAL CONDOS FROM 2,000 SQ. FT.THENEXT BIGTHING

CENTRAL BRAMPTON LOCATION

T/L AND D/I SHIPPING2,000 - 20,000 SQ. FT.

VERY WELLMAINTAINED PARK

• 1,778 sq. ft. for lease• Located in a sought after Mississauga node• Abundant parking• Close to major highways and amenities• T/L door is 53’ accessible• Clean warehouse space• Possibility for earlier occupancy

TIMBERLEA BOULEVARD, UNIT#3M I S S I S S AU G A , O N5700

NEW

6186 Mayfield Road, CALEDON

12 acres

I

SOLD

7845 Heritage Road, BRAMPTON

149,632 sq. ft.

LEASE

D

1290 Aimco Boulevard, MISSISSAUGA

12,056 sq. ft.

SOLD

1393 South Service Road, OAKVILLE

10,000 sq. ft.

LEASE

D

1880 Matheson Blvd E, MISSISSAUGA

LEASE

D

216,439 sq. ft.

1300 Aimco Boulevard, MISSISSAUGA

SOLD

15,047 sq.ft.

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

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

*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

JEFF HORD*Senior Sales Associate416 798 6258jeff.hord@cbre.com

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

SAVREEN DHILLONClient Services Assistant416 798 6279savreen.dhillon@cbre.com

65 Worchester Road, TORONTO

83,293 sq. ft.

SOLD

8400 Parkhill Drive, MILTON

65,414 sq. ft.

LEASE

D