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The industrial sector in Canada’s real estate market is ripe for investment in 2014, as the logistics and distribution segment is expected to see strong demand resulting from growing international retailers and e-commerce.

This is according to LaSalle Investment Management’s 2014 Investment Strategy Annual.

“The logistics and distribution segment remains undersupplied in most markets across Canada, so we anticipate seeing continued strong demand in this sector in 2014,” says Chris Langstaff, Canadian strategist with LaSalle.

“In addition, demand for well-located retail space will stay strong in Canada as the market absorbs new entrants, including many U.S. retail chains seeking a presence in Canada,” Langstaff explains.

The Investment Strategy Annual also notes that the U.S. urbanization trend driven by millennials is also evident in Canada, with cities such as Toronto, Montreal and Calgary seeing more high-density residential development in downtown and surrounding areas. Meanwhile, as many U.S. retail chains continue to enter Canada, existing Canadian chains will continue to adapt and seek new ways to better compete.

Canadian property markets remain healthy, and much of the new supply is pre-leased or is replacing obsolete product, according to LaSalle. Canada is expected to see challenges in identifying new markets for its exports, as well as a potential housing
slowdown.

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© Copyright 2014 Rogers Publishing Ltd. Originally published on benefitscanada.com

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