Beyond the Big Cities: What Canada’s Industrial Real Estate Markets Taught Us in 2026

What do Mount Pearl, Moose Jaw, Kelowna, and Trois-Rivières, have in common?

Aside from rarely appearing together in a national real estate market report, they reveal something important about Canada’s industrial property landscape: smaller markets don’t necessarily mean more affordable space, more availability, or easier leasing decisions.

Throughout 2026, Landmark Advisory Services’ Market of the Month series explored industrial real estate conditions in communities across Canada, from Atlantic Canada to British Columbia.

We looked at regional distribution hubs, manufacturing centres, transportation corridors, and industrial markets that rarely receive the same attention as Toronto, Montréal, or Vancouver.

While every location has its own economic drivers and market conditions, several themes emerged from our research. For industrial tenants planning a lease renewal, expansion, or relocation in 2027, these observations offer some valuable lessons.

1. The Vacancy Rate Doesn’t Tell the Whole Story

Kelowna, BC, provides a particularly revealing example.

Landmark’s research identified an overall industrial vacancy rate of 3.8% at mid-year 2025. However, conditions varied significantly across the region.

Vacancy was just 0.9% in Dilworth-Springfield and 1.5% in Kelowna North, compared with approximately 10% in West Kelowna.

For a business that depends on central access to customers, suppliers, or employees, these locations aren’t necessarily interchangeable.

The same principle applies elsewhere. In Dartmouth, NS, modern industrial facilities in established areas such as Burnside Industrial Park remain highly sought after.

The tenant takeaway: Look beyond citywide vacancy rates. Evaluate individual submarkets based on transportation access, workforce considerations, and operational requirements.

2. Available Doesn’t Always Mean Suitable

A building can be available, competitively priced, and located in the right market, yet still be unsuitable for your operations.

This was a recurring theme throughout our research.

In Sarnia, ON, older industrial buildings dominate much of the available inventory, limiting options for tenants requiring modern clear heights, efficient loading, or significant outdoor storage.

Moose Jaw, SK, faces similar challenges, with older, low-clear-height buildings representing much of its industrial stock.

In Mount Pearl, NL, limited modern inventory and high construction costs contribute to higher rents for newer facilities.

For industrial tenants, the lowest base rent isn’t necessarily the best deal. Insufficient loading capacity, inadequate power, inefficient layouts, or limited yard space can create operational costs that outweigh rental savings.

The tenant takeaway: Evaluate a property’s functionality and total occupancy costs, not simply the asking rent. Establish your non-negotiable requirements before comparing options.

3. New Development Doesn’t Always Mean New Leasing Opportunities

New construction is encouraging, but tenants need to understand what’s actually being built.

In Trois-Rivières, QC, industrial investment includes port modernization and employment-land expansion. However, much of the development activity is intended for owner-occupiers or build-to-suit projects rather than properties available on the open leasing market.

Moose Jaw, SK, presents a related challenge, with significant portions of its industrial inventory owner-occupied or offered for sale rather than lease.

Meanwhile, Sarnia, ON’s 51-acre Sarnia 402 Business Park offers longer-term development potential, but the research identified no confirmed construction or occupancy timeline.

Even in Edmonton, AB, a major Canadian industrial and logistics hub, active development doesn’t necessarily guarantee suitable, well-located space for every tenant.

The tenant takeaway: Investigate how much of the development pipeline will actually be available for lease, when it can be occupied, and whether it meets your operational requirements.

4. Low Vacancy Isn’t Just a Big-City Problem

While Canada’s largest metropolitan areas often dominate discussions about tight industrial markets, limited availability can be equally challenging in smaller regional centres.

In Prince George, BC, industrial vacancy was reported below 1%, with limited options for businesses seeking modern, mid-sized warehouse facilities.

Sudbury, ON, faced similar challenges, with limited modern distribution inventory despite ongoing industrial demand.

In Sarnia, ON, established manufacturing and petrochemical industries support demand for industrial facilities, while tenants seeking approximately 5,000 to 15,000 square feet can face particular difficulty finding suitable space.

In regional markets with limited inventory, tenants may face longer searches and fewer alternatives when negotiating a renewal or relocation.

The tenant takeaway: Don’t assume that a smaller market offers greater availability or flexibility. Research properties that meet your requirements and allow sufficient time to evaluate your options.

What Should Industrial Tenants Take Into 2027?

The clearest lesson from our 2026 research is that industrial market conditions are highly localized.

A citywide vacancy rate can conceal significant differences between submarkets. New construction may be reserved for owner-occupiers. Older buildings may dominate available inventory while modern facilities remain difficult to secure.

For tenants preparing for 2027, four priorities stand out:

• Start early. Allow sufficient time to understand the market before committing to a renewal, relocation, or expansion strategy.
• Know your alternatives. A strong negotiating position depends on understanding what suitable properties are available.
• Look beyond rent. Consider building functionality, additional rent, improvements, transportation costs, and operational efficiency.
• Explore development opportunities. In supply-constrained markets, off-market options, pre-leasing, or build-to-suit arrangements may deserve consideration.

National trends provide useful context, but navigating local market complexities requires more than statistics.

That’s where Landmark’s experience makes a difference. Active in markets across Canada, from major metropolitan centres to smaller regional hubs, we combine local market intelligence with nationwide tenant representation expertise. Whether you’re negotiating a renewal, expanding into a new market, or managing a multi-location portfolio, we help you understand your options, navigate local challenges, and make informed real estate decisions.

Exploring Canada’s Industrial Markets

Revisit the markets featured in Landmark’s 2026 Market of the Month series:

British Columbia: Kelowna, BC | Prince George, BC

Alberta: Edmonton, AB

Saskatchewan: Moose Jaw, SK

Ontario: Sarnia, ON | Sudbury, ON | Ottawa, ON

Québec: Trois-Rivières, QC

Nova Scotia: Dartmouth, NS | Lower Sackville, NS

Newfoundland and Labrador: Mount Pearl, NL

Market observations reflect the research periods and information presented in Landmark’s individual Market of the Month articles.

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