After a turbulent period for commercial real estate, investor interest is rebounding, though buyers remain highly selective, according to RE/MAX Canada.
RE/MAX’s 2026 Commercial Real Estate Report, released today, shows office leasing activity picked up in the first quarter across 12 major Canadian markets as return-to-office policies renewed demand for premium space.
“While uncertainty shaped much of 2025, we’re now seeing a clear shift in investor behaviour,” said Damon Conrad, vice-president of RE/MAX Canada Commercial.
“Capital remains cautious and focused on preservation, but as financial conditions stabilize, deferred demand is beginning to re-emerge. Investors are highly selective, but they are increasingly prepared to act where income stability and long-term value are evident.”
Demand concentrates around premium office space
Canada’s office market continues to bifurcate between high-quality, amenity-rich buildings and older properties that struggle to attract tenants. Demand is strongest for well-located Class A space in downtown cores, while aging assets face ongoing leasing pressure in both urban and suburban markets.
Return-to-office mandates have helped boost absorption in several major centres, though elevated vacancy rates persist in markets such as Calgary, Winnipeg and London. In some cities, residential conversion initiatives have reduced excess office supply and helped restore market balance.
Suburban office markets have also shown resilience, with solid absorption reported in Calgary, Edmonton, Hamilton, the Greater Toronto Area and Ottawa as tenants prioritize affordability, accessibility, labour availability and safety.
Neighbourhood retail pulls ahead
Retail remains one of Canada’s most resilient commercial asset classes. The report finds continued strong demand for necessity-based and service-oriented retail. Grocery-anchored plazas and neighbourhood shopping centres in cities including Calgary, Regina, Hamilton and Halifax are reporting low vacancy rates, and tight inventory is intensifying competition among investors.
Walkable retail districts featuring boutiques, restaurants and local services are gaining momentum in centres such as the GTA, Calgary and Ottawa. These community-focused retail areas are outperforming many traditional formats, supported by steady foot traffic, strong tenant retention and stable rents.
Several municipalities are also taking steps to revitalize struggling downtown retail corridors. For example, Winnipeg has piloted programs that transform vacant storefronts and underused public spaces into pedestrian-friendly gathering areas with public art, seating and lighting.
Industrial market holds firm
Industrial real estate remains a foundational pillar of Canada’s commercial market, with particularly strong demand for small-bay and flexible industrial space in many regions. Cities including Edmonton, Regina, Winnipeg, London and Ottawa continue to experience tight inventory, while markets such as Vancouver and the Hamilton–Niagara corridor are still absorbing recent new supply.
The report highlights growing demand for industrial facilities tied to recreation, logistics and data infrastructure, as some developers pivot from stalled condominium projects in Vancouver and the GTA toward more industrial uses.
“Transaction activity is beginning to build,” said Conrad. “While recovery remains uneven, momentum is clearly shifting toward a more active and disciplined investment environment.”