Toronto Warehouse Market Report 2025: Your Guide to GTA Industrial Space

Last Updated: December 2025

If you’re looking for warehouse space in Toronto and the Greater Toronto Area, you’re entering North America’s tightest industrial market – and one of its most dynamic. The GTA has transformed into a continental logistics powerhouse, processing over a quarter of all immigrants arriving in Canada and experiencing record population growth that’s driving unprecedented demand for distribution space.

Let me walk you through what’s happening on the ground here, beyond just the headlines about Canada’s booming population. Whether you’re a small business owner looking for your first warehouse or a broker helping clients navigate this market, here’s what you need to know.

Why Toronto is North America’s Hottest Industrial Market

MARKET SNAPSHOT: GTA WAREHOUSE FACTS

The numbers tell part of the story, but here’s what they mean for you: Toronto has the lowest vacancy rate of any major American or Canadian market. When availability dipped below 1% earlier this decade, it created a landlord’s market unlike anything on the continent. While vacancy has now risen to a more balanced 4.9%, the GTA remains exceptionally tight compared to U.S. markets averaging 7%+ vacancy.

The real driver? Immigration. The Toronto CMA absorbed more than one-quarter of all new immigrants arriving in Canada in 2024, adding a record 269,000 people in a single year – 70,000 more than second-place Dallas-Fort Worth. Every one of those newcomers needs goods delivered, which means warehouse demand isn’t slowing down.

The Submarkets That Matter Most

Brampton & Mississauga (GTA West)

This is the heart of GTA logistics. With direct access to Pearson International Airport and highways 401, 403, 407, and 410, the GTA West consistently leads leasing activity. Major recent developments include:

• Oxford Properties: 331,027 sq ft at 2600 North Park Dr., Brampton
• Pure Industrial: 458,496 sq ft at 20 Whybank Dr., Brampton
• Carttera: 362,248 sq ft at Avonhead Zero Carbon Industrial Campus, Mississauga

Expect to pay $14-18/sq ft in these prime logistics corridors. Brampton and Milton offer more cost-efficient opportunities with newer developments, while Mississauga commands premium rates due to limited availability.

Vaughan & York Region

York Region was the tightest submarket in the GTA in early 2025, with vacancy falling to just 1.5% while maintaining some of the GTA’s highest average rents at $16-20/sq ft. If you need proximity to Toronto’s northern suburbs and access to Highway 407, this is your spot.

Notable spaces include Metrus Properties’ 582,334 sq ft facility at 9501 Highway 50 in Vaughan.

City of Toronto

Urban infill opportunities are extremely limited and command the highest rates. If you need to be inside city limits for last-mile delivery, expect significant premiums. Most larger distribution operations have moved to the 905 area codes.

East GTA (Whitby, Ajax, Durham)

The eastern corridor offers relative value compared to the west, though development is accelerating. Amazon’s 519,000 sq ft robotics sortation centre in Whitby (leased for 15 years) signals confidence in this submarket’s growth trajectory.

What Small Businesses Need to Know

The good news: While major institutional players compete for 500,000+ sq ft distribution centres, there’s still opportunity in the 10,000-50,000 sq ft range. Sublease availability remains slightly elevated at 760,000+ sq ft – the lowest since late 2023, but still a potential opportunity for smaller tenants.

Your advantages in this market:

• Workforce: Warehouse workers earn approximately $17/hour ($34,540/year), competitive with other markets
• Diverse labor pool: Immigration provides consistent workforce supply
• Infrastructure: Access to one of North America’s best highway networks
• Market stability: Even during vacancy increases, rates remain healthy

Watch out for:

• Competition remains fierce – Good spaces still move quickly
• Exchange rate considerations – All rates quoted in CAD; factor this into cross-border comparisons
• Property taxes – Ontario property taxes can significantly impact total occupancy costs
• Winter operations – Budget for snow removal and heating costs November through March
• Minimum wage increases – Ontario’s minimum wage rose to $17.20/hour in October 2024

Major Transactions Shaping the Market

2024-2025 Landmark Deals:

Prologis acquisitions:

• 1.34 million sq ft at 8450 Boston Church Rd., Milton – $361 million (RONA distribution centre with 15-year leaseback)
• 1.6 million sq ft Canadian Tire distribution centre in Brampton – $258.1 million ($160/sq ft)

Unilever: Acquired 744,000 sq ft LEED Gold-certified Brampton warehouse from H&R REIT for $121.4 million

Amazon: 519,000 sq ft purpose-built robotics sortation centre in Whitby (90% owned by Concert Properties)

Industrial transactions totaled $5.55 billion in the GTA during 2024 – the highest of any real estate sector despite a 27% year-over-year decline.

Real Numbers from Real Deals

Current Rate Ranges by Submarket:

Rates have declined from peak levels – down from $17.66/sq ft in Q2 2024 to $15.25/sq ft in Q2 2025. This 5.9% annual decrease reflects market normalization, not weakness.

Looking Ahead: What’s Coming in 2025-2026

The Good:

• Net absorption surged in Q3 2025 to 3.6 million sq ft – the strongest quarterly performance since Q4 2022
• Construction pipeline remains healthy at 16.45 million sq ft under development
• Population growth continues even as immigration policy adjusts (study permits capped at 437,000 for 2025)
• Tenant activity has picked up since Q4 2024

The Challenges:

• Pre-leasing levels are soft at 39.2% nationally on projects under construction
• New supply delivered 6.9 million sq ft in Q4 2024 alone, with 14.2 million sq ft completed throughout the year
• Unemployment in Toronto sits at 8.2%, exceeding Ontario’s 6.8% average
• Housing costs averaging $1.135 million impact workforce availability and commute patterns

Making Your Move: Practical Next Steps

If you’re a small business owner:

1. Start your search 6-9 months before you need space
2. Consider the 905 area codes (Brampton, Mississauga, Vaughan) for better value
3. Explore sublease opportunities – 760,000+ sq ft available
4. Work with a broker who knows specific submarkets (the GTA is massive)
5. Factor in total occupancy costs: base rent + TMI (taxes, maintenance, insurance)
6. Consider proximity to workforce – transit access matters

If you’re a broker:

1. Emphasize York Region’s ultra-tight 1.5% vacancy for clients needing premium locations
2. Position GTA West as the logistics standard-bearer
3. Highlight the Amazon presence as validation of submarket strength
4. Connect clients with municipal incentive programs
5. Educate on CAD/USD implications for cross-border clients

The Bottom Line

Toronto offers something increasingly valuable: a growing, diverse market with strong fundamentals and access to one of the world’s most educated, multilingual workforces. Yes, it’s more competitive than ever. Yes, you’ll pay more than in American secondary markets. But the combination of population growth, infrastructure, and market stability makes the GTA arguably the most resilient industrial market in North America.

The 4.9% vacancy rate represents a healthier, more balanced market than the sub-1% conditions that made leasing nearly impossible a few years ago. For tenants, there’s finally some negotiating room. For investors, the fundamentals remain strong with $5.55 billion in transaction volume validating institutional confidence.

Whether you’re expanding from the U.S. or growing within Canada, the Greater Toronto Area should be on your shortlist.