Ottawa Industrial Market Report

Suburban areas scarcely impacted by current market shift. Ottawa’s industrial sector has withstood elevated interest rates over the past two years better than other metros. Compared with an annual increase of 160 basis points nationwide, Ottawa’s industrial vacancy rose by just 60 basis points in the second quarter of 2024, making it one of the lowest in Canada at 2.3 per cent. In outlying submarkets, vacancy held steady at 2.5 per cent as space demand remained stable amid minimal supply growth. Smaller structures dominate non core areas, providing flexible, lower-cost options for local tenants serving growing suburban communities. In the city of Ottawa, while demand for large-bay spaces has softened, the vacancy rate remained low at 2.1 per cent in the second quarter, with preliminary data showing a 10-basis-point decline quarter over quarter for the third quarter. Although the overall vacancy rate is still likely to drift higher, it is expected to remain below 3.0 per cent by year-end, indicating a resilient market.