Montreal Industrial Market Report

Absorption rate under pressure amid short-term headwinds. Space demand in Montreal remained sluggish during the first three months of 2025, marking the seventh consecutive quarter of negative net absorption. This weakness was especially evident in the large-bay segment. Several third-party logistics providers and online retailers paused expansion plans, with Amazon’s decision to close all seven of its Quebec warehouses earlier this year being the latest reflection of this trend. Meanwhile, U.S. tariffs on aluminum are having a more pronounced impact on Montreal’s industrial sector, given the metro’s key role in supporting Canada’s aluminum production and exports. Coupled with the overall sentiment that has been clouded by uncertainties, this slack in space demand may persist in the near term, putting upwards pressure on the vacancy rate this year.