According to a new report from Colliers Canada, there are many good reasons to bet on Canadian commercial real estate in 2025—and not just because it’s cheaper than New York or L.A.
In fact, Canada now outperforms the U.S. across seven major investment fundamentals, from cost of debt to demographics. Whether you're a global fund manager or a private investor looking for portfolio diversification, Canada's stability, growth, and long-term upside make it one of the most attractive commercial real estate markets in the world right now.
Let’s break down the key reasons why.
🏢 1. Office Real Estate: Canadian Cities Are Leading the Recovery
While U.S. metros like San Francisco continue to struggle with remote work and rising vacancies, Canadian cities like Vancouver and Toronto are seeing a strong return to the office.
In Q1 2025, Vancouver’s office vacancy rate was less than a third of San Francisco’s. Canadian employers are leading the return-to-work push, and demand for downtown commercial space is stabilizing faster than in most American markets.
💵 2. Lower Cost of Debt
Here’s the real kicker for investors: the cost to borrow in Canada is significantly lower than in the U.S.
Thanks to faster rate cuts by the Bank of Canada, commercial financing in Canada is not only cheaper—it’s also more predictable. With a historically wide interest rate gap between the two countries, Canadian investments offer better leverage and improved cash flow potential.
🧮 3. Canada’s Fiscal Strength = Investor Confidence
Unlike the U.S., where ballooning federal debt is raising alarms, Canada’s federal debt-to-GDP ratio remains much more sustainable. That fiscal headroom gives Canada more flexibility to respond to economic shocks—without risking investor confidence or destabilizing the credit market.
In short: Canada is seen as a safe, disciplined environment for long-term capital.
📈 4. Underbuilt and Ready for Growth
Did you know that the U.S. has significantly more commercial space per capita than Canada? From office towers to shopping centres, Canada has room to grow, especially in fast-expanding suburban markets.
That leaves investors with an advantage: less oversupply risk and more opportunity for value creation through development or repositioning.
👥 5. Stronger Population Growth = Demand for Everything
With one of the highest immigration rates in the G7, Canada’s population growth is fueling demand for retail, industrial, office, and multifamily real estate alike.
Even with Ottawa temporarily adjusting immigration targets, the long-term demographic trends remain bullish—especially in major hubs like Toronto, Vancouver, Calgary, and Montreal.
📊 6. Lower Volatility, More Stability
U.S. commercial real estate markets are notorious for their boom-bust cycles. Canada? Not so much. With a higher concentration of institutional investors and more conservative lending standards, Canada is far less prone to panic selling and price crashes.
That makes Canada a safer, more stable environment for long-term investors, especially those focused on capital preservation.
💹 7. Better Returns in 2025
According to Colliers, a Canadian commercial property index is showing positive returns, while U.S. property values have continued to slide since mid-2022. For investors seeking both stability and upside, Canada is currently checking both boxes.
🌍 The Bigger Picture: Canada Is the New Safe Haven
Historically, investors have looked to U.S. dollars, bonds, and tech stocks as their “safe haven” plays. But in today’s geopolitical climate—with trade wars, political instability, and policy unpredictability in Washington—Canada is emerging as the new go-to for global capital.
As Colliers head of research Adam Jacobs puts it:
“Real estate is about fundamentals—demographics, immigration, the job market. And when you line Canada up against any country, those fundamentals are strong.”
🧠 Why Lendworth Is Watching This Closely
At Lendworth, we’ve long believed that Canadian real estate—commercial or residential—is backed by resilient fundamentals and powerful long-term tailwinds.
While we primarily focus on residential mortgage investments across Ontario, we closely track commercial trends because our borrowers and investors are often tied to both sectors.
If you’re exploring asset-backed investments, real estate-secured lending, or MIC-qualified opportunities, we invite you to discover how Lendworth Mortgage Investment Corporation (LMIC) is delivering targeted annual returns of 9%+, with a portfolio focused on high-LTV, residentially zoned, GTA properties.
📞 Want to learn more? Contact us today.
🔗 www.lendworth.ca | 📩 info@lendworth.ca | 📍 10-8750 Jane St, Vaughan, ON