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Market Report

Toronto Retail Investment Forecast

2022 Outlook

Resilience During the Pandemic Prompts Construction and Lifts Investor Sentiment


Builders shift focus to suburbs. Toronto’s retail segment endured adversity as COVID-19 restrictions subdued foot traffic and changed the way consumers behave. Despite these challenges, retail vacancy never exceeded 2 per cent at the height of the disruption, and availability has since gravitated downward. The demand drivers in the GTA are unquestioned, with the metro logging 16 consecutive quarters of positive net absorption entering this year. Strong leasing activity is expected to continue in 2022, though a large construction pipeline will inhibit vacancy from contracting to the 1.7 percent mark recorded prior to the pandemic. Areas of Toronto adding the most new inventory, putting them at risk of a short-term rise in availability, include Outlying York, Outlying Peel and Markham-Richmond Hill. These are all suburban locations, which are attracting new residents amid remote work flexibility and escalating living costs in the urban core. In light of these trends, retailers have been expanding their footprint in the suburbs, highlighted by Walmart committing to an 180,000-square-foot spot in Newmarket.

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