GTA Industrial Market Report - Q2 2026

Users Move In, Investors Sit Out, Vacancy Falls Further

Q2 was the third consecutive strong quarter for GTA industrial. Net absorption (the change in occupied space, i.e. new leases, minus space vacated or given back) hit 3.5M SF (up from 2.7M in Q1), pulling vacancy down to 2.2%.

This is the lowest level of vacancy we’ve seen in 2 years, and GTA West was the main driver, with vacant space in the region falling by 2.6M SF this quarter alone.

Space under construction has dropped below the 10M SF mark for only the second time in nearly five years, so the new-supply pipeline is thinning out fast as we continue to chew through previous inventory.

Importantly, rents have stopped bleeding.

GTA net asking rents sit at $16.22 PSF, which is down only half a percent quarter-over-quarter after the ~13% pullback from the 2023 peak. In other words, the market is stabilizing, not still falling.

It’s worth noting that this trend is not uniform across our market, though.

Brampton is carrying more slack than Mississauga right now: Brampton West posted negative absorption this quarter (more space came available, than was leased) with availability approaching 8%, while several Mississauga nodes (Central West, East, Meadowvale, West) are sitting under 1% vacancy and still tight.

Sale pricing tells us the same story - freehold industrial (15,000+ SF) came in around $335 PSF GTA-wide, which is down year-over-year, but condos actually moved up to $496 PSF.

Smaller, owner-user-friendly product is holding value better than larger freehold right now.

This lines up well with what we're seeing at the deal level: focusing specifically on GTA West, deal count is steady (28 this quarter vs. 26 a year ago), but median price/SF is down roughly 15-20% year-over-year, with Brampton softening more than Mississauga.

Bottom line: Vacancy is genuinely tightening, and new supply is drying up - that sets up well for landlords into 2027. Tenant inducements are shrinking too: free rent packages and tenant improvement allowances are markedly weaker than in past quarters.

The exception is institutionally-owned buildings with functional issues that are stuck on the market - landlords there are still dangling upwards of $10/SF in incentives to move them.

If you're weighing a decision, I can confidently tell you that the window to transact ahead of the next leg of rent growth is now.