Almost 9-Million Square Feet Leased in Q1 2021 TRREB Commercial Network Members reported 8,814,762 square feet of leased space through TRREB’s MLS® System in Q1 2021 for all lease transaction types across the industrial, commercial/ retail and office market segments. This result represented a 92.8 percent increase compared to Q1 2020. It is important to note that the second half of Q1 2020 saw limited transactions due to uncertainty related to COVID-19 and the associated public health restrictions that were put into place.
Year-over-year changes in average per square foot net lease rates, for transactions with pricing disclosed, all increased in Q1 2021 compared to Q1 2020. The average office lease rate was up to $18.10 from $17.68 in Q1 2020. The average industrial lease rate for Q1 2021 was $10.24, up from $8.59 in Q1 2020. The average commercial/retail lease rate was $19.88, an increase compared to $17.31 in Q1 2020. It is important to note that annual changes in average lease rates can result from changing market conditions and changes in the mix of space leased from one year to the next, in terms of location, size, property type mix and other related variables.
Total commercial sales in Q1 2021 were down by 15 sales to 283, from 298 in Q1 2020. Sales in the industrial sector amounted to 91 in Q1 2021 – down slightly from 93 sales in Q1 2020. Commercial/ retail sales were down from 130 in Q1 2020 to 118 in Q1 2021. There were 74 office sales in Q1 2021, inline with 75 sales reported in Q1 2020. It is important to recognize that the effects of COVID-19 and related public policies have impacted the investors’ longer-term economic outlook and timing.
Moving forward, it will be important to monitor trends through the lens of COVID-19-related public policy and broader economic indicators. This will include post-pandemic trends in flexible working arrangements and retail spending patterns.