2021 Canada Commercial Real Estate Investment Outlook
Commercial Real Estate 2021: Adapting to the New Normal;
Trends, Insights and Outlook for Four Major Property Types
Recovery on the horizon; vaccinations will be key. Following Canada’s 5.3 percent economic contraction last year, a strong recovery could mount in 2021 with growth forecasts ranging between 3.6 to 5.3 percent for the year. Despite the severe wave of coronavirus infections at the start of this year, gross domestic product increased by an estimated 0.5 percent in January, far exceeding the 0.1 percent expansion recorded one month earlier. The successful distribution of the COVID-19 vaccines will be integral to a full recovery. Through March 2021, just 1.5 percent of the Canadian population was fully vaccinated, but the pace of inoculations could accelerate as vaccine production gains momentum. Canada could reach a positive immunization tipping point in the second half of the year, allowing most businesses to reopen and a return to offices. As health concerns diminish and businesses reopen, consumer spending could quickly ramp up, powering the economic revival. Over the course of the pandemic, Canadians have accumulated upward of $100 billion in excess savings that could fuel pent-up spending. If that is combined with a proposed $100 billion three-year government stimulus package, Canada’s economy could deliver a dramatic boost to commercial real estate space demand.