Is investment in Canadian commercial real estate growing?
Canada’s commercial real estate market continues to attract significant interest from both domestic and foreign investors. In the second quarter of 2026, commercial real estate investment volume reached $16.2 billion, its highest level since early 2022, with foreign investors accounting for 43.9% of acquisitions and Canadian investors representing more than one-third of acquisition activity.
This momentum is driven by multiple factors, including Canada’s favourable exchange rate, diverse asset classes, and reputation as a stable investment market. Continued growth projections across several sectors, together with initiatives such as the Productivity Mega Deduction, suggest that commercial real estate will remain an attractive investment opportunity for years to come.
As investment activity increases, investors are faced with an important strategic decision: how to structure their entry into the market. While some investors may prefer the flexibility and control offered by acquiring a specific property, others may seek the scale, operational expertise, and growth opportunities available through an established real estate platform. This article compares these two investment strategies and highlights some of the key benefits and risks associated with each.
What should investors consider when purchasing a single asset?
For many Canadian and foreign investors, acquiring a single real estate asset, whether vacant land, a development site, or an income-producing property, offers a high degree of control over how and where capital is deployed. Rather than acquiring an existing platform with a predetermined portfolio or an interest in that platform, investors can target specific assets that align with their investment objectives, risk tolerance, and preferred asset class. This approach also allows investors to respond directly to local market conditions and demand drivers.
Single-asset acquisitions can also create significant opportunities for value creation through development, redevelopment, and strategic asset management. Investors are able to focus resources on a particular property and execute a business plan tailored to that asset’s characteristics and market potential. For example, DSV’s development of a large-scale logistics facility in Innisfil, Ontario demonstrates how investors can generate value by transforming land into purpose-built real estate that meets specific operational and market needs. By concentrating on an individual asset, investors may be better positioned to capitalize on development opportunities and respond to evolving market demand.
Another advantage of a single-asset acquisition is it offers greater flexibility and control, with the investor able to pursue their own defined investment or development strategy and without taking on an existing corporate organization. Investors can make targeted decisions about deployment of capital and execute according to their own timelines and financing arrangements. This strategy also provides investors more freedom in determining other parties with whom they contract and do business, including co-owners or partners, construction and other contractors, property managers, and tenants, as well as the ability to leverage any existing relationships.
Despite these advantages, because capital is concentrated in a particular asset, investors may be more exposed to property-specific risks and execution challenges. Also, identifying attractive acquisition opportunities and realizing the anticipated value can require considerable time, capital, and expertise. While this approach offers flexibility and control, investors seeking growth may find that building a portfolio on an asset-by-asset basis can be a slower path to achieving scale, market presence, and operational efficiencies.
What should investors consider when acquiring or investing in a platform company?
While a single-asset strategy offers investors flexibility and control, others may favour a platform-based investment strategy as a means of achieving scale and operational efficiencies more quickly. This can be accomplished through the acquisition of all or an interest in an established real estate business, or by partnering with an experienced local operator that already possesses the assets, infrastructure, and expertise necessary to support growth in the Canadian market. This approach provides investors with access not only to an established portfolio, but also to the management expertise, operating infrastructure, and industry relationships needed to support and expand that portfolio over time, with a more predictable return.
This approach can be seen in TPG’s partnership with Oxford Properties Group to acquire a 75% interest in its industrial portfolio via a joint venture valued at $1.3 billion, providing TPG with immediate exposure to an established real estate platform and accelerating its entry into the Canadian market.
Beyond providing access to an existing portfolio, platform acquisitions can offer significant operational advantages. By acquiring or partnering with an established investment operation, investors gain access to experienced management teams, proven operating systems, and established industry relationships on a more passive basis. This can reduce the need to build those capabilities internally and provide continuity in the management and growth of the portfolio.
GIC’s investment in Dream’s industrial portfolio illustrates this benefit, with Dream’s subsidiary continuing to act as asset manager following the transaction. Platform investments may therefore provide investors with access not only to existing assets, but also to the expertise, infrastructure, and acquisition capabilities necessary to support future growth.
While platform acquisitions can provide immediate scale and operational expertise, they may also introduce complexity in their own right, including navigating tax and regulatory requirements. Additionally, although there are clear potential benefits with a portfolio of established income-generating properties, including assuming existing contracts, management teams and relationships, there is also the potential this comes with unexpected liabilities and inheriting preexisting issues with assets or personnel.
Which investment approach is right for you?
There is no one-size-fits-all approach to investing in Canadian commercial real estate. Whether pursuing a single-asset acquisition or a platform-based investment, investors should carefully evaluate how each structure aligns with their strategic objectives, operational needs, and growth expectations. Careful evaluation of these factors at the outset, supported by qualified legal and professional advisors, can help investors deploy capital more effectively and position themselves for long-term success.
For more information about these investment structures and how they may apply to your business, please contact a lawyer from our Corporate Law Group or Real Estate Group.
