Newmark Knight Frank Devencore

Newmark Knight Frank Devencore

October 08, 2014 07:30 ET

Newmark Knight Frank Devencore Reports on Growing Toronto Industrial Market

Development Activity in GTA West Driving Market Expansion

TORONTO, ONTARIO--(Marketwired - Oct. 8, 2014) - In its Industrial Real Estate Market Study published today, Newmark Knight Frank Devencore reported that the need for larger, more modern industrial spaces has spurred significant development activity in the GTA West. At the present time, some 4 million square feet of industrial space is being built in Mississauga, Brampton, Caledon and Milton.

"The key stories in the GTA industrial real estate market during the first half of 2014 concerned the supply and demand disconnect and the increasing obsolescence of older industrial properties," said Rob Renaud, Managing Principal / Broker of Record at Newmark Knight Frank Devencore's GTA West Office(1). "In part, this has to do with the changing nature of the GTA's industrial base, where the exponential growth of e-commerce businesses is fuelling demand for larger and more modern logistics and distribution spaces. Typically, these spaces are 400,000 square feet to 1.5 million square feet, have higher clear heights, more trailer parking, better office space layouts, more energy efficient systems and, in many cases, building designs that are specifically tailored to the space users."

Throughout the GTA, vacancy rates have fallen from 4.2% to 3.9% over the past year. While demand was greatest for spaces of 400,000 square feet and beyond, there was also significant tenants activity in the 20,000 to 100,000-square-foot market. Asking rental rates have remained relatively stable over the past twelve months and are averaging $5.75 in the GTA as a whole.

"The continued changing dynamic of industrial activity, with the shift away from manufacturing to e-commerce, logistics and warehousing enterprises, is having a clear impact on the GTA's industrial real estate landscape," Mr. Renaud added. "The developments currently underway will certainly help to ease the demand; however, as needs evolve so too will the specifications that tenants require in their premises. As an example, we are already seeing a growing need for clear heights as high as 40 feet, which the new 32 to 36 foot clear speculative developments do not address.

"Given these issues, space users must weigh all of their options, including build-to-suit premises where they may see leases that extend up to 20 years. Tenants who do not necessarily require the most modern space have a greater range of options. The key is to prepare a thorough real estate analysis that takes both present and future needs into account and aligns with overall business strategy. Build-to-suits, blend-and-extends and/or lease restructurings may also prove advantageous," Mr. Renaud concluded.

About Newmark Knight Frank Devencore

As part of Newmark Grubb Knight Frank, one of the world's leading commercial real estate advisory firms, Newmark Knight Frank Devencore is Canada's largest corporate real estate advisor and brokerage, exclusively representing corporate, industrial and retail space users. With offices across the country, Newmark Knight Frank Devencore offers its global clientele comprehensive services that are individually designed to ensure executive real estate decisions are supported by effective strategies and professional execution. To learn more about our capabilities, please visit

About Newmark Grubb Knight Frank

Newmark Grubb Knight Frank (NGKF) is one of the world's leading commercial real estate advisory firms. Together with its affiliates and London-based partner Knight Frank, NGKF employs more than 12,000 professionals, operating from more than 330 offices in established and emerging property markets on six continents.

With roots dating back to 1929, NGKF's strong foundation makes it one of the most trusted names in commercial real estate. Its integrated services platform includes leasing advisory, global corporate services, investment sales and capital markets, consulting, program and project management, property and facilities management, and valuation services. A major force in the real estate marketplace, NGKF serves the local and global property requirements of tenants, landlords, investors and developers worldwide. For further information, visit

NGKF is a part of BGC Partners, Inc. (NASDAQ:BGCP), a leading global brokerage company primarily servicing the wholesale financial and real estate markets. For further information, visit

Contact Information

    Allan Schaffer
    President / Broker of Record
    416-366-0366, ext. 231
    Newmark Knight Frank Devencore

    Devencore Realties Corporation
    Canada Limited, Brokerage
    130 Adelaide Street West, Suite 2929
    Toronto, Ontario M5H 3P5

    Rob Renaud
    Managing Principal / Broker of Record
    416-366-0366, ext. 241
    Newmark Knight Frank Devencore

    Devencore Realties Corporation
    (Toronto West) Ltd., Brokerage
    1 Eva Road, Suite 409
    Toronto, Ontario M9C 4Z5