Canadians just elected Prime Minister Mark Carney and the Liberal Party of Canada to lead the country.
Congratulations to Prime Minister Carney. He brings incredible credentials and is somebody that can help guide and lead us in developing new trading partnerships and policies. As our prime minister, he will explore and build new relationships for Canada.
Over the past few months, amidst multiple tariff announcements out of the United States, we’ve had leadership uncertainty in Canada. With a new prime minister, we will see renewed certainty and forward momentum. Both the investor and the occupier side of commercial real estate will be back to decision-making, as there’s no doubt that the lack of clarity of the past few months has had clients pushing the pause button.
The new government will be in a solid position to address the challenges of tariffs and our relationship with the American administration and other trading partners around the world. In Alberta, for example, the pause button has less to do with tariffs and more to do with the new government, because the outcome of our election in Alberta is significant, given how all policies touch this province. Hopefully, Carney reconnects with our friends in this important part of the country.
Although we may still see some challenges ahead with a minority Liberal government, rather than a majority, I see great potential for Carney and Pierre Poilievre to set aside differences in their policies and beliefs and, instead, reach common ground for the strength and resilience of Canada – given these leaders do in fact share some mutual ideas.
What do I mean? Both parties promised to eliminate the Goods and Services Tax (GST) for the purchase of a first home of less than $1 million. Both parties also committed to lowering taxes for the middle class, which should help consumer spending. In terms of energy infrastructure, both leaders said they would create a one-stop shop to expedite the approval and construction of major projects. They agreed Canada should focus on energy, which will benefit Alberta’s economy but also create energy security for Canada. Further, both the Liberals and the Conservatives are promoting more efficient government management and reduction of red tape and bureaucracy.
These measures are all good for our economy and for commercial real estate – key campaign promises made by both parties that will be beneficial for commercial real estate and should face little or no opposition now.
Looking at the rest of 2025, the recovery within commercial real estate and the economy is still in excellent shape. We have low unemployment and inflation is under control, so far. Despite current uncertainty, large and upper mid cap companies on the occupier and investor sides continue to make decisions on the long term. Trade policy isn’t affecting their decision-making as much as the smaller midcap and small-cap companies. Those companies tend to be more cautious.
With a new government in place, we believe that business will start to build confidence about the future and get back to making strategic decisions regarding their business in Canada and globally.
This combined with strong fundamentals like low inflation and falling interest rates is a winning combination for the real estate industry.
With the election settled, future office conditions are more positive than you might initially be led to believe. Smaller transactions are moving ahead. In particular, local private buyers are active, encouraged by the long-term upside at current valuations. Suburban office assets have emerged as a bright spot.
A consideration for suburban office demand is the connectivity to the employment base from nearby residential suburbs. Many leasing markets are showing positive absorption, which means more space is being leased than vacated. Return to office momentum is firming up and we can see the light at the end of the tunnel. For this reason, I suggest that this is an asset class to watch closely for opportunity if you’re a patient investor.
Mark Fieder is president of Avison Young Canada. Send Industry Perspectives Op-Ed comments and column ideas to editor@dailycommercialnews.com.
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